The IRS issued Rev. Proc. 2014-30 announcing the inflation-adjusted amounts for health savings accounts (HSA). For calendar year 2015, the annual limitation on deductions for an individual with self-only coverage under a high-deductible plan is $3,350 ($6,650 for an individual with family coverage).

A “high-deductible health plan” is a health plan with an annual deductible that is not less than $1,300 for self-only coverage or $2,600 for family coverage and annual out-of-pocket expense limits (deductibles, co-payments and other amounts, but not premiums) that do not exceed $6,450 for self-only coverage or $12,900 for family coverage.

We highly recommend that you take a look at the Health Savings Account strategy.  In a nutshell, it is a medical IRA.  You can put away for 2014 $3,300 as a single taxpayer, $6,550 as a taxpayer with family coverage plus an additional $1,000 if you are age 55 or older.  This is an above the line tax deduction that helps you save tax dollars on both your federal and state income tax returns.  You never loose the money.  You put the money in and obtain the tax deduction.  The HSA sits there… growing based upon where you have opened the HSA… waiting for you to have a medical expense that you in effect move from a potential itemized deduction (very difficult to obtain) to an above the line tax deduction.

CRITICAL DETAIL… you must have a high deductible health insurance policy that qualifies to use a Health Savings Account.  This insurance MUST BE IN PLACE before you open the HSA and have a medical issue that you want to pay using the HSA.  The medical issue must have occurred AFTER you have opened the HSA so timing is important here.

Take a look at it… an above the line tax deduction is difficult to turn away from.  If you need to discuss this strategy for saving tax dollars, please schedule an appointment through Jen at 248-544-6160.

From the HIX Exchange

1. Avoid the excise tax.

Many employers are already making changes to their medical plans in anticipation of the excise tax in 2018. Also known as the Cadillac tax, it’s a 40% tax on the value of medical benefits over a set threshold. Organizations likely to hit the threshold have time to plan for a “soft landing” by phasing in changes to reset benefit cost at a lower level now, Mercer says. The most common strategies are adding in low-cost consumer-directed health plans and eliminating the highest-cost plan offered today.

2. Rethink dependent coverage.

All employers should take a closer look at how they subsidize dependent and spousal coverage, Mercer suggests. Employers are increasingly implementing working spouse provisions that either eliminate coverage for spouses with health insurance offered elsewhere or imposing a surcharge on their coverage. The 2013 Mercer National Survey of Employer-Sponsored Health Plans found 16% of large employers have such a provision, up from 12% in 2012.

3. Consider coverage options for part-time and variable hour employees.

Extending coverage to all employees working 30 or more hours per week will make up a large part of the increase in health benefit spending due to the ACA, Mercer says. Several strategies can be considered to become compliant with the law. They include limiting the number of hours worked for some employees, extending coverage to all eligible employees, adding a low-cost plan for newly eligible employees or simply paying the shared responsibility assessment.

4. Embrace next-generation wellness strategies.

Many employers will add or expand health-management/wellness programs in an effort to reduce health care spending by improving workforce health, Mercer says. The ACA allows employers to increase the value of incentives from 20% to 30% of total plan costs, and up to 50% for tobacco non-use.

5. Consider a private exchange.

Interest in private health insurance exchanges is growing rapidly, Mercer says. A private exchange allows an employer to better manage costs and deliver flexibility and choice to its workforce. Mercer’s survey found that one-fourth of all employers are considering switching to a private exchange to deliver benefits to retirees or actives within just two years — and nearly half would consider switching within five years.

The U.S. Small Business Administration and the Michigan Small Business Development Center are pleased to offer a free TEAM SBA Roundtable on Small Business Lending at:

Oakland County SBDC
2100 Pontiac Lake Rd. Bldg. 41,
Waterford, MI 48328

May 22, 2014 from 9:00 a.m. to Noon.

The roundtable gives current or prospective small business owners insight into the SBA Guaranty Loan Program and the criteria used by loan officers to evaluate a loan request. A team of experts will demystify the lending process, debunk the myths about SBA programs, and share real life examples of successful loan applicants. The roundtable is taught by experienced lenders with expertise in small business and SBA financing. “What’s unique about the roundtable is the access to the SBA and small business lenders,” said Gerald Moore, Michigan SBA District Director. “Every roundtable is different and each is tailored to the needs of the participants. It’s a very interactive process and one of our top rated training events.” Over 2,000 clients have attended the roundtables since 1998. The roundtable is best suited to those seeking financing for their business, have good credit, a solid business idea, and some money to invest in the business.

For more information or to register online for this free seminar, Team SBA or call 248.858.0783. Please note: SBA does not provide loan guarantees to real estate investment companies and this topic will not be part of the discussion.

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If you are looking for funding, free information is hard to beat! eas

IRS impersonators seem to be popping up along with spring flowers!

Scenario: telephone contact identifying the caller as an IRS representative from the Department of Legal affairs. They will provide a name and a contact phone number. The individual indicates that you owe money from a prior year return and that you need to make a payment immediately. If you do not make a payment a sheriff will be to your residence to arrest you. They will freeze your assets etc etc.

THIS IS A SCAM!!!! One of our clients who resides on the east side of the Detroit metropolitan area received this call last week. Fortunately he was wise enough to know:

1. IRS will never make an initial contact by telephone demanding payment.
2. IRS will always have contacted you repeatedly by mail… regular paper and postage stamp type of mail.
3. IRS will not be threatening to freeze assets, take money from your checking account, send you to jail over the telephone.

If you receive one of this type of call, please PROVIDE NO PERSONAL INFORMATION to the caller. Make note of the date of the contact and how it was made as well as any other information that you consider important (name, phone number, what was said etc).

After hanging up the phone and DIVULGING NO PERSONAL INFORMATION OF ANY KIND, go to the following website: www.tigta.gov (US Treasury Inspector General for Tax Administration). Follow the very simple online sheet to report your incident. TIGTA representative will contact you directly if they need further information.

Part of the process of reporting your incident is to create a 5 digit Personal Identification Number (PIN). Be certain to remember or make note of this number so that if someone does (in this circumstance) contact you directly by telephone, you can ask them to provide you with the PIN that you created at the time of making the report. Thus you will know that this is a bona fide call from the IRS.

Ah yes… spring brings daffodils and impersonators wanting to fleece the unwary. Do not be that person.

Less than a week to go before April 15th arrives… at that point it is TOO LATE to do anything to help yourself!!!!

The IRS has received almost 100 million tax returns so far this year and expects to receive about 35 million more by the April 15 filing deadline. Another 12 million taxpayers will have requested extensions by the filing deadline of April 15th, giving them an extra 6 months to file their tax return.

REMEMBER that this extension is AN EXTENSION OF TIME TO FILE YOUR RETURN>>> NOT an extension of time TO PAY your tax liability.

If you think that you owe money to IRS, even if you do not have the funds available… it is critical that you file an extension. That simple process stops one of the penalties that will accumulate if you have an unpaid tax liability.

We are happy to help you figure that out so that you can go on extension. Give us a call at 248-544-6160 if we can be of assistance.

Be sure that you are filed or on extension by April 15th!

by Michael Cohn, Accounting Today

April 10, 2014 – The Internal Revenue Service said Thursday it has initiated more than 200 new investigations this filing season into identity theft and tax refund fraud schemes, and the IRS Criminal Investigation unit has started 295 new identity theft investigations since January, pushing the number of active cases to more than 1,800.

The nationwide effort by the IRS’s Criminal Investigation unit is underway as part of a major effort at the IRS to combat identity theft and refund fraud by pursuing identity thieves, preventing fraudulent refunds from being issued and helping victims of this crime.

“Identity theft is one of the fastest growing crimes nationwide, and refund fraud caused by identity theft is one of the biggest challenges facing the IRS,” said IRS Commissioner John Koskinen in a statement. “The investigative work done by Criminal Investigation is a part of an aggressive effort by the IRS to combat this issue on all fronts. We are making substantial progress in refund fraud protection, and the work by CI highlights the important steps we are taking.”

Since the beginning of 2014, increased activity by the CI unit has led to more prosecution recommendations, indictments and sentencing hearings, which reflect the overall success by the IRS on the increased number and effectiveness of ID theft filters used during the processing of tax returns

The IRS has learned of a new phishing scam in which taxpayers receive emails purporting to be from the Taxpayer Advocate Service bearing the IRS logo.
The email contains a bogus case number and says:
“Your reported 2013 income is flagged for review due to a document processing error. Your case has been forwarded to the Taxpayer Advocate Service for resolution assistance. To avoid delays processing your 2013 filing contact the Taxpayer Advocate Service for resolution assistance.”
The email contains a link where the recipient can find contact information for the “advocate” assigned to their case that solicits personal information such as the recipient’s legal name and contact information. There’s also a link to review “your reported income” that again solicits this kind of personal information.
If you get inquiries from taxpayer clients about these messages, please tell them NOT to click on the link and to forward the email to the IRS’s designated address for such e-mails: phishing@irs.gov.
Taxpayers can find instructions for forwarding the messages on IRS.gov.

‘Know Your Numbers’ Financial Workshop Offered in Sterling Heights on April 11th

The Michigan SBDC in Wayne County is offering a workshop for experienced businesses called “Know Your Numbers: Five Keys to Using Financial Statements to Maximize Cash Flow and Increase Access to Capital”. Presented by an experienced SBDC Finance Consultant, the workshop helps existing business owners strengthen their ability to increase cash flow, use breakeven analysis in decision making, make strong financial projections and work effectively with bankers.

Date/Time: April 11 8:30 am to 12 noon.

Location: Northwest Activity Center 18100 Meyers Road Detroit, MI 48235.

Cost: $25 (to reduce fees, this program is supported by Fifth Third Bank)

Register online: Know Your Numbers

Call: 313-672-1100 for more information.

NO FOOLING AROUND!!!!!  The IRS has received more than 75 million individual tax returns as of March 14 and projects that it will receive about 149 million individual income tax returns by the end of the year.

Thus we are half way there!

Watch for update of what to do if you are not able to file your tax return by April 15th. It is important to file something by the 15th!

If you are in need of assistance, please give us a call at 248-544-6160.