How to Report Tax Fraud:

Have you ever wondered how you would report tax fraud? If you suspect that someone has stolen your identity, has filed a fraudulent tax return or you are receiving fraudulent e-mails from the IRS, you need to report these activities immediately. The IRS has a section on their website that gives you information on how to report suspected tax fraud activities. If you have any questions about tax fraud, please contact us!
 http://www.irs.gov/Individuals/How-Do-You-Report-Suspected-Tax-Fraud-Activity%3F

Are Baby Boomers the Most Charitable Generation?

A recent article from the CPA Practice Advisor pointed out that Baby Boomers are the most charitable generation, donating more than 43% of all charity dollars! “When it comes to charitable giving, Baby Boomers are still the most active, even while at the same time they are looking at retirement and aging issues” (CPA Practice Advisor). This interesting article also points out that certain generations are more likely to give to certain charities. For example, the older generations are more likely to donate to veteran’s causes, while the younger generations donate more to children’s charities. Read the article below and tell us what you think!

http://www.cpapracticeadvisor.com/news/11109162/baby-boomers-lead-the-way-in-charitable-giving

What You Need to Know about Bankruptcy

Millions of people in the United States struggle with debt and long to be free of the burden of unpaid bills that they simply cannot pay. For some, there is the option of claiming bankruptcy. As defined by the Bing Dictionary, bankruptcy is the “legal inability to pay debts: the state of having been legally declared bankrupt”. When you declare bankruptcy, you are saying that it is impossible to pay off the debt you have. Although claiming bankruptcy can take away the stress and burden of debt, there are negatives to the process as well.  Claiming bankruptcy can clear some debts: credit cards, bills, certain loans. But it does not cover student loans, alimony, or child support. Also, claiming bankruptcy will negatively affect your credit score, and can prevent you from taking out a car loan or a mortgage.

 Bankruptcy is a process in which the individual or the business can eliminate their debts under the protection of the federal court. There are two types of bankruptcy: liquidation and reorganization. Liquidation is a means of converting assets into cash, which will pay off the outstanding debts. Reorganization is the process of organizing outstanding debts and coming up with a payment plan to pay back the debtors. The most common claims for individuals are Chapter 7 and Chapter 13. The following is a list of the different types of bankruptcy, provided by the US Courts website:

 ·    Chapter 7 is Liquidation
 ·    Chapter 9 is Adjustment of debts of a Municipality
 ·    Chapter 11 is Reorganization
 ·    Chapter 12 is Adjustment of debts of a family farmer or fisherman with regular income
 ·    Chapter 13 is Adjustments of debts of an Individual with regular income
 ·    Chapter 15 is Ancillary and Other Cross-Border Cases

 The following are links with more information on bankruptcy.
http://www.nolo.com/legal-encyclopedia/chapter-7-13-bankruptcy-basics-29829.html
http://www.uscourts.gov/FederalCourts/Bankruptcy.aspx

 

 518 Arbor Hill Rd.

Kernersville, NC 27284

Ph: 336-996-3338

www.cpamcdaniel.com 

IRS Cracking Down on Identity Theft

Identity thieves, beware. The IRS has opened more criminal investigations on tax-fraud cases this year than in 2012, and it’s only August. By assigning tax-fraud cases to more employees, the IRS has been proactive in cutting down on identity theft. Because of the focus on tax fraud investigations, the IRS has rejected almost 5 million suspicious tax returns. Click the link below to learn more.

http://www.accountingtoday.com/news/Criminal-Investigations-Identity-Theft-Increasing-IRS-67638-1.html

 

Is your PIN code easy to guess?

An article from Fox 8 News lists the 20 most common PIN codes. The more common the PIN code is, the easier it is for thieves to guess! If your PIN code is included in the list, you might want to consider changing it.

• 1234
• 1111
• 0000
• 1212
• 7777
• 1004
• 2000
• 4444
• 2222
• 6969
• 9999
• 3333
• 5555
• 6666
• 1122
• 1313
• 8888
• 4321
• 2001
• 1010

http://myfox8.com/2013/08/01/the-20-most-popular-four-digit-pin-codes/

Planning on Retiring Early? You Need to Read This:

Retiring early sounds like a dream. No more work, no more stress; just relaxation and time to do the things you’ve always wanted to do. “But there's only one problem with this wishful thinking: Retiring early is easy, but making your money last is hard” (How Stuff Works). The full retirement age is 66 or older, depending on what year you were born. It is possible though, to start receiving retirement benefits (Social Security) at age 62, but it will cost you because you will only receive partial benefits. “If you start collecting at 62, you'll receive only a partial benefit. Calculated over the length of your retirement, you'll receive 25 percent less Social Security benefits if you start collecting at 62 as opposed to waiting for your full retirement age” (How Stuff Works).  If you decide to retire before the age of 62, you will be solely dependent on retirement and savings accounts you have set up.  “To understand how much money you’ll need after you say good bye to your nine-to-five job, take your pre-retirement income and multiple it by 35 (assuming you’ll live to age 85). For example, if you are living off $100,000 now, you’ll need about $3.5 million when you retire. Not a small sum” (Forbes). To get a realistic view of your finances, the McDaniel & Company website offers easy to use calculators that can help you figure out how much money you actually have and how much money you will need. From loan comparisons to savings goals, and Net Worth to Lifetime Earnings, these calculators can give you a proper and realistic view of your finances. If you have any questions about these calculators or you would like to schedule a consultation, please contact us! We will be happy to assist you.

Do you plan on retiring early, or have you retired early? Let us know in the Comments!

Financial Calculators: http://www.cpamcdaniel.com/Framecalculators.htm

Forbes. Anna Vander Broek. ‘How to Retire Early’. http://www.forbes.com/2010/11/02/retire-early-plan-lifestyle-personal-best-10-saving.html

How Stuff Works. Dave Roos. ‘How to Retire Early’.  http://money.howstuffworks.com/personal-finance/retirement-planning/how-to-retire-early.htm

 

 

Community Spotlight

“Happiness doesn’t result from what we get, but from what we give” –Ben Carson

“Every sunrise is an invitation for us to arise and brighten someone’s day” –Richelle E. Goodrich

Volunteering in your community is a great way to get involved and do some good. Kernersville, North Carolina is a wonderful community with many places to volunteer your time and talents. Check out the non-profit foundations below, and consider giving back to your community!

·         The Paul J. Ciener Botanical Garden                    http://www.cienerbotanicalgarden.org/volunteer-opportunities-kernersville-garden.php

·         The Kernersville Parks and Recreation department http://toknc.com/pages/default.aspx?lid=c9hx02VEfIo=&pid=/u6twdYpKLY=

·         The Shepherd’s Center of Kernersville             http://www.shepctrkville.com/volunteer/volunteer-job-descriptions

·         The Kernersville Branch Library                   http://www.forsyth.cc/library/kernersville/friends.aspx

·         The Körner’s Folly Foundation                               http://www.kornersfolly.org/preserve/volunteer/

 

How to Avoid Scams

Sometimes a telemarketing scam is blatantly obvious. A company you have no connection with calls to retrieve a payment for a service, or a company will ask for money up front to do a service for you. But sometimes, a scam can seem like the real deal, and you can accidentally give away important information.

We recently had this problem. After discussions with our bank, we received a call from an undisclosed location regarding our merchant account. The individual on the phone claimed to be with our bank. Since we recently had discussions with the bank, the call did not seem odd initially. After talking to the individual further, they requested that we fax copies of our statements to them that we were inquiring about. Immediately we thought it was strange that an employee of the bank wouldn’t have access to the statements, so we called our local bank to verify that the call was legitimate. And it was a good thing we did! Our local bank called the number they gave us and it turns out that the caller had no connection with the bank whatsoever. Immediately we told the person we were not interested and to not call us again, and the issue was resolved.

Unfortunately, things like that happen every day. And even worse, you might not realize that the call is a scam and you could accidentally give private information or funds to these scam artists. To avoid a bad situation, ALWAYS ask where the caller is from and how they received information about you. Ask for a phone number and call it. If the caller is the real deal, they will not mind holding while you check the phone number. If the caller asks for information they should already have or money up front, it is probably a scam. Contact your local representative of the company if possible, and double check that the caller is connected with the company. In any case, if you sense that there is anything odd or strange about the phone call, it is best to hang up.  The FBI website has a list of common “pick-up lines” that scam callers might try to use on you. (http://www.fbi.gov/scams-safety/fraud/fraud#telmkt) We recommend reading through the ‘Common Frauds’ section to become educated about common scams that you could fall victim to.

To avoid falling victim to a scam or identity theft, it is important that you take your privacy seriously. Don’t give away private information to anyone that you do not know. Don’t throw away any documents or receipts that have your personal information on them; this includes your name, phone number and address. As the old saying goes, ‘Better safe than sorry’.

If you have been involved, or have come close to believing a scam, comment below and tell us your stories. When did you realize it was a scam? Did you report the person, or how was the situation handled?

 

Last Tax-Free Weekend

This upcoming weekend, August 2-4, will be North Carolina’s last tax-free weekend. Governor Pat McCrory signed into law a tax reform bill that cut out North Carolina’s annual tax-free weekend, as well as the tax break on Energy Star-rated appliances. Plan out your shopping lists and hit the stores this weekend so you don't miss out on the tax-free goods. Don’t forget to check out local stores, as they are offering tax-free goods this weekend as well.  Click on the following link from the N.C. Department of Revenue to find out what items are tax-free this weekend. http://www.dor.state.nc.us/taxes/sales/holiday_exempt.pdf