Bookkeeping for Bloggers – Contests, Lotteries and Sweepstakes


Hosting a giveaway (technically not a legal term, but it’s used interchangeably with the term sweepstakes) is not only a great way to promote your blog or a product, but also it’s a great way to build followers and build great relationships with sponsors. As a host it’s your responsibility to make sure your sweepstake is legally set up. You definitely want to avoid turning your sweepstake into a lottery. The laws governing the sponsorship and hosting of social media promotions are widely overlooked or misunderstood. Below is a brief overview of the laws and tax implications you need to know to avoid placing your business at legal risk.

Generally speaking, there are three types of online promotions:

  1. Lotteries
  2. Sweepstakes
  3. Contests

Beginning with lotteries which are random drawings for prizes wherein participants have to pay to play. Let’s look at the three components of a lottery: 

 1.) Prize, what you are giving away
2.) Chance, the element of luck involved in winning the prize, and
3.) Consideration, something of value.

For example from a bloggers standpoint, if you require someone to follow you or like your blog or page (consideration) for the probability (chance) to win a tablet (prize) that would place your giveaway into the lottery category which is so much more highly regulated (with the exception of state‐run lotteries and authorized raffles). You also cannot charge a fee or make someone purchase something for someone to enter your promotion or it will be considered a “lottery.” You must make certain that your giveaway does not contain all three of these components. Of course hosting a giveaway you will be expected to have a prize and a chance, so you need to avoid having those who enter exchange consideration for the chance to win. So before considering having a “giveaway” you may want to consult with a legal consultant or check with your state to ensure compliance with their laws as well as with federal agencies.

The majority of bloggers usually run what you would call sweepstakes, meaning they give prizes away by choosing the winner by random drawings or chosen predominately by chance. Then you have contests, which is a promotion in which entrants win a prize based on merit or skills and prizes are awarded based on a judging panel or a voting process (for example, the best poem or the winner of a trivia game). No matter which option you choose whether it’s a Sweepstake or a Contest you must have official rules. Two of the most used statements in the rules are “no purchase necessary” and “void where prohibited by law.” Check out this link via How to Use Contests, Sweepstakes, and Giveaways as Marketing Tools – While Staying Within the Law. Now as you know I am an EA and not an attorney so the information contained herein is not intended to constitute legal advice or a legal opinion as to any particular matter and I urge you to consult with an attorney concerning your own situation and any specific questions you may have. The contents are intended for general information purposes only from my own experience dealing with clients, by preparing the correct tax forms to send to the recipients of the winnings/prizes and assisting the business in filing their own forms to the correct agencies.

Knowing which social media promotion you are running or hosting, whether it be contests, sweepstakes, raffles, drawings, giveaways, or freebies will have tax implications.

Sponsors of lotteries, sweepstakes, drawings and raffles that are considered gambling must send the recipient a W-2G if the recipient’s cash winnings and/or the Fair Market Value (FMV) of prizes such as cars and trips are $600 or more and at least 300 times the amount of the wager. Also, you must withhold at a 25% rate if the winnings minus the wager are more than $5,000 of gambling winnings for federal income tax.

Sponsors of contests and sweepstakes are required to send the recipient a 1099-Misc if the recipient’s cash winnings and/or the Fair Market Value of merchandise won are $600 or more and do not involve a wager. 

Eligibility might be further limited to particular states within the United States that have relatively more rigorous legal requirements, which includes:

  1. Florida – sponsors of promotions in which the total value of the prize exceeds $5,000 must file a copy of the rules and a list of all prizes at least seven days before the promotion begins and submit proof of either a trust account or surety bond equivalent to the sum of the prizes offered. Promotions based in other states must be filed if they are open to Florida residents and have prizes valued at more than $5,000.
  2. New York – the filing requirement are an issue when the total value of the prize exceeds $5,000. If that is the case the sponsor must file with the Secretary of State at least 30 days prior to the start of the promotion along with a statement setting forth the official rules and regulations and create a trust account, certificate of deposit or surety bond in the amount of the offered prize.
  3. Rhode Island – the filing requirements begin when the promotion is offered at a retail establishment and the value of the prize exceeds $500. Rhode Island does not require the posting of a bond.

There may be filing fees associated with submitting the required information to these states along with other professional fees needed in the assistance of completing these tasks (lawyers, brokers, etc.) – these fees are considered business expenses, so they can be deductible on your tax return.

In addition to structuring sweepstakes and contests to comply with federal and state laws, companies must pay attention to the promotion terms and conditions of social media networking sites. Check out their promotion guideline agreements.






I hope the information that I’ve shared was helpful.   Again, the information contained herein is not intended to constitute legal advice or a legal opinion as to any particular matter and I urge you to consult with an attorney or your state/federal regulators concerning your own situation and any specific questions you may have.


Debbie Thomas, EA, NRB


I’m Blogging and I’m Making Money Doing It….What Do I Do Now?

Bookkeeping for Bloggers

I‘m Blogging and I’m Making Money Doing It….What Do I Do Now?

As an EA and a certified bookkeeper I get asked questions like, “what do I do now that I am making money from blogging?” Or, “what information should I keep for filing my taxes?” I had no idea that people were making a living from blogging. These online diaries known as weblogs or ‘blogs’ have morphed into a cutting-edge phenomenon that has provided a platform for the internet’s next wave of innovation and moneymaking opportunities. For those of you who are thinking about getting into blogging and are wondering some of the ways bloggers are making money from this well here are some of the ways they’re doing it. They are putting advertisements on their blog like Google AdSense which is an easy non-technical way of generating income. All you need to do with AdSense is copy a code and paste it on your website. Another way is to be in an affiliate program which allows you to post a link to the company’s product on your blog and if someone clicks through your blog to their site and orders, you would get a portion of the sale. Also, you can make money from private sponsorships and when your blog becomes really established with readers you can expand by offering memberships to your website to gain access to exclusive content on your blog. There are a lot more ways to generate money by having a blog but those mentioned are the most popular. However I’m not here to tell you how to make money I’m here to explain what to do when your blog starts to generate money and to give you some resources to help you navigate through the process.

business or hobby

Well as I stated earlier you can make pretty good money blogging. As you start making money your blog becomes your business and the way it works is this: For tax purposes, a business is any activity in which you regularly engage primarily to earn a profit. You don’t have to show a profit every year to qualify as a business. As long as your primary purpose is to make money, your blog should qualify as a business (even if you show a loss some years). Your blogging business can be full time or part time, as long as you work at it regularly and continuously. However, if your primary purpose is something other than making a profit—for example, to communicate with your friends or make your opinion known—the IRS will find that your blog is a hobby rather than a business.

Keeping good books and other records and carrying on in a professional manner can constitute that you are running your blog as a business. Working on a regular basis and earning a substantial profit, even after you’ve had some losses in the past will help show that you are serious about trying to make it a success. As a business, you now have to claim all income; even the free stuff you get, unless it’s labeled as a gift or corporate sample, is considered income. If your blog qualifies as a business, you’ll be able to deduct your business expenses from the income you earn from the blog. If you have a loss, you’ll be able to use it to reduce your taxable income from other sources such as wage income and investment income. It’s also worth noting that your expenses shouldn’t really outweigh your income (although sometimes it’s unavoidable in your first years of business, taking into account start-up costs and so forth). Keeping receipts, a separate bank account and all other documentation is a great start for getting your business organized for tax time. It also shows that you are running your blog as a legitimate business. Once you’ve established that you are running a business, it is now time for you to set up an entity structure (LLC, S-Corp, C-Corp).  I do not recommend that you be set up as a Sole Proprietorship.  I do encourage you to speak to your tax professional about the tax implication of each entity and what will work for you.  Check out this link for more information on whether you’re considered a business or a hobby.


So then what things can a blogger deduct? Just about anything that is directly related to your blogging business and is necessary and reasonable in amount. Below are some categories and expenses a blogger could deduct.
Internet fees
Website hosting fees
Domain name cost(s) and renewals
Business Travel

Transportation costs: car mileage; airline tickets; taxis; buses; trains
Hotel costs for business trips
Costs of conferences, plus all related expenses
Continuing Education
Further education classes
Business podcasts
Meals are only deductible as an entertainment expense when provided to a customer or client. In general, only 50% of the cost of the business meal can be deducted; other rules limit “lavish or extravagant” meal and other expense deductions
Fax/scanner/copier equipment
Computer equipment/Laptop
DVDs and CDs related to your blogging
Movie or theater tickets, etc., if related to your blogging
Stock photo purchases for your blog
Film, Web & Digital cameras
Dues & Subscriptions
Books and magazines used for research
Research sites that require a subscription
Memberships to professional clubs and affiliations
Business logos and graphic design fees
Business cards, letterhead and other stationery
Online self-promotion fees (that includes banners and AdWords costs)
Legal and Professional Services
Search Engine Optimization services and fees
Website design and/or maintenance fees
Tax preparation/Bookkeeping fees
Business incorporation costs
Costs for Trademarks or Copyrights
Home Office Deduction
You can deduct the part of your home you use exclusively for blogging as an expense, including a portion of the rent, water, heating bills, insurance and so on.
Office Expenses
Business equipment rental
Tax and accounting software
Postage costs
PayPal and Bank fees
Post Office Box fees
Prizes and giveaways
For more information on deducting business expenses check out this link.

keeping track3So now you know what you have to do, here are a few options you have for keeping track of your income and expenses.

First, hire a bookkeeper. Of course I would tell you to do this because I’m a bookkeeper (wink). Some may think it’s too expensive which is understandable if you’re not really making a substantial amount of revenue, but for those making a living at this may want to consider it because in the long run you could save a lot of time and money when it comes tax time. It is definitely the easiest way to go because you can just drop off a box of receipts to a bookkeeper and pay them to organize, align and produce a package that will help you file your taxes or even pay them to do your taxes if they are also licensed tax professionals.  A bookkeeper will have complete and up to date records of all your business interactions, produce professional reports and ensure your books are accurate. If you don’t have the funds at this time to hire a bookkeeper there are other ways to keep track of your activities: For example you can use Microsoft Excel to keep track of your business income and expenses.  It’s much easier to keep track of every activity if you have a separate bank account for your blogging business.  Another way would be to use an online accounting program; I’d recommend using Wave Accounting or FreshBooks.  These online programs usually have bookkeepers or accountants, as their advisors. These folks can help you if you get stuck or have questions or just want advice and it’s FREE.  FreshBooks have limitations but you can upgrade if need be. When you decide you’re ready to purchase software you can always contact a QuickBooks ProAdvisor and they can help you choose the correct QuickBooks package and give you special discounts. Most of the QuickBooks ProAdvisors can be contacted via email or phone to help answer any questions you may have with your QuickBooks. Click this link to find a QuickBooks ProAdvisor

This quick introduction definitely does not compare to meeting with or speaking to a certified bookkeeper, accountant or enrolled agent (EA). It is only meant as a quick guide to get you started with keeping track of your business activities. If you are able to meet with a bookkeeper, I highly encourage you to do so; they can be great resources to have.

If you have any questions please email me and I’ll be glad to answer any of your questions.

Debbie Thomas, EA, NRB

Don’t Judge A Book By Its Cover


Where’s the best place to get your taxes done? 
That is the question.

Well let me give you something to think about when deciding.  It all started when I moved from my home state of WV to the good ole state of Maryland.  I had just received my degree in Accounting and IT and was ready to look for a new career.  I had already been working for the last ten years as a librarian where I so envied the VITA volunteers who came every year to provide free tax services to the community and I so wanted to one day be involved with that.  If you don’t know what VITA is, well it stands for Volunteer Income Tax Assistance which is a program regulated by the IRS to provide free tax assistance to taxpayers.  Anyways, before moving from WV I applied for a job at a CPA firm and after a week I got a call about the position stating that it had already been filled, boy did I start to worry that I would never find a job opportunity like that again being how we lived in a small town.  I was really hoping to land something before I actually moved to Maryland.  If you’re wondering why I was moving well it’s because my fiancé had been offered a job there so I decided I was going to move myself and my three boys there to start a new life.  Sounds exciting doesn’t it.  Well it was!

So there I was getting ready to take that last drive to Maryland where I thought I’d have a job but, NOTHING.  So about a month later I received a call from the CPA firm that I had applied for and lo and behold I got the job.  So there I was working for a CPA firm learning so much.  I quickly learned that what you are taught in college does not prepare you for what you will actually be doing.  I mean I was doing payroll, bookkeeping, financial statements for home building contractors, doctors, apartment buildings, you name it I did it. All this prepared me for the task of preparing taxes for corporations, partnerships and individuals. I was calculating depreciation and loan interest as well.  So I thought maybe I should expand my skills and go to an H&R Block class and maybe prepare taxes there.  I mean they are well-known so they must be good at what they do.  I told my boss what I was doing and he kind of giggled under his breath.  I went back into my office wondering why he giggled as if I was joking about taking the tax class at H&R Block and maybe working there for some more experience.

Ok, well here is where I discovered why he giggled.  As I walk into the class I found a table way in the back and took a seat.  Looking around at the few people who were already sitting at the other tables I wondered what their stories were.  Then in walks the instructor (or should I say a “wanna” be comedian) and class is about to begin until a few more people start rushing in.  Ok, finally he’s ready to explain the program and go over everything.  I was so excited until it was that time for everyone to introduce themselves.  Here we go, the start of the introductions and it seems everyone in the room was interested in the same thing, a part-time job to make a little extra money.  Let me just tell you after the whole “getting to know you” thing I found out that out of the 15 people in the class I was the only person with a degree and/or any type of background in accounting, taxes or business.  There were housekeepers, store clerks, restaurant cooks, cashiers … you get where I’m going.  So now I’m wondering how does an H&R Block tax preparer get qualified.  Well come to find out after taking the 6 week basic tax course all you need to do is take a test and pass with a 80%.  The instructor told us that the tax software that is used is fools proof – meaning that any idiot should be able to put numbers into the program and unless an error comes up, you are good.  They are not required to ask for any additional info from the client or anything.  So I’m thinking this is easy money to be earned.  This brings me to my next “Say What” moment.  How much do we get paid?  At that time it was $7.25.  Yes folks, $7.25 – hold up. They charge clients outrageous prices to get a simple tax return prepared and the preparer gets $7.25/hr.  It’s called overhead ya’ll.  I forgot to tell you earlier that you also pay for your tax training class as well.

No more was I wondering why my boss giggled when I told him my plans on furthering my learning.  As I walked into work after completing my course at H&R Block he asked me how it was going and I told him that it wasn’t for me and I don’t think I will be going back and then I giggled.

So fast forward to where I am today an Enrolled Agent and a business owner a CE course author and of course I finally got to volunteer for VITA as an Advanced Certified preparer.  I can say that when I hear people say that they are going to one of those tax franchises to have their taxes prepared I kind of cringe.  Not because of the experience I had but because they aren’t educated enough to know what to look for in a preparer.  It’s not necessarily the place you’re going to get your taxes done but who is preparing your taxes.  Don’t get me wrong there are some good tax preparers working in these offices – as I could have been one, but you also have some that just do the basic data entry.  My advice to you is to ask your preparer questions about your return or make sure they know your situation so that you can get the best tax service for your money and see if they will be around after the current season to prepare you for the next tax season in case you have any questions.

To help you with some of the questions or concerns just follow my blog and social media sites.  The info posted to these sites will guide you when it comes to making sure you’re getting your taxes prepared correctly.  Remember these are big corporations just wanting to get your money so it’s your job to make sure you’re not getting taken advantage of.  In the end you are responsible for your tax return no matter who prepares it.



I hope sharing this story with you gave you a little insight on deciding what to do when choosing the right place to get your taxes prepared. What are some of your experiences and what are your concerns, please leave a comment and share.

Have a wonderful day!

Debbie Thomas, EA

Claim Your Sweetheart on Your Taxes


Most of you don’t know that you can actually claim your wonderful significant other on your tax return as a dependent.

Yes, you heard me right.  You can claim that broke boyfriend or girlfriend on your taxes.  I mean didn’t reading those first two sentences put a smile on your face after thinking about how you come home every day from work seeing that “soul mate” sleeping on the couch with “your” empty bag of chips laying on the floor beside them.  Instead of seeing that list of potential jobs written down on the pad of paper you had placed on the coffee table before you left out to go to work that morning (hint, hint).  You bust your butt every day to provide a comfortable place for the both of you to live and eat, don’t you think you deserve a break.  Don’t get me wrong there are those of you who have wonderful significant others who you adore and they are trying so hard to find a job while helping you out by cleaning the house and having dinner ready when you get home – Now that’s a Sweetheart!  Both of these scenarios are very common and both can give you a little tax relief at tax time.

Unfortunately a lot of taxpayers are missing out on this opportunity to claim your boyfriend or girlfriend on your tax return because you do not know a lot about the tax laws or because you go to one of those “tax franchises” that get you in and out with their basic training. I had posted a link on our FB Page stating “Ten Reasons Why You Still Need A Tax Pro” which this would be a good reason to use one.  Check out the info graphic from SmartCenter on the article.

Anyways, back to the subject of taking an exemption for the love of your life.  A federal exemption is earnings that get subtracted from a taxpayer’s adjusted gross income (AGI). They are often applied when claiming children or qualifying relatives as dependents.  Each year the exemptions increase; for 2013 it was $3,900 and now for the coming tax year 2014 it will be $3,950.

There are necessary criteria in order to be able to claim a boyfriend or a girlfriend on your taxes and you must ensure you take precautions when doing so.  Make sure you have documents that show proof of your financial support like receipts or bank statements showing those items.  If you don’t have proof of residency you may want to get a notarized letter from your landlord or neighbor, but if the person has mail or other proof of residency then that will work as well.

The Internal Revenue Service (IRS) have tests that needs to be met before you are able to claim the significant other on your return.

  • Support Test – You provided more than half of his/her support
  • Relationship Test – He/she must have lived with you throughout the entire year as a member of the household
  • Non-Qualifying Child Test – She/he cannot be a qualifying child
  • Income Test – The significant other (boyfriend/girlfriend) cannot have made more than $3,900 (2013), $3,950 (2014)

Here are some other facts to consider:

  • You cannot be claimed as a dependent by anyone else
  • The person must be a U.S. citizen
  • Your relationship cannot violate local laws
  • Both of you cannot not file taxes jointly

I hope this information was helpful and I would advise you to speak to your tax pro for guidance to make sure you get the most out of your tax filing year.  Feel free to leave a comment or email me at for any further questions or comments.  Also, don’t forget to check out our website at

Have a wonderful day!

Debbie Thomas, EA

It’s Spring – Let’s Get Organized!


Are you ready?  Well then let’s get started!

I hope you’re energized and ready to start clearing out all of those old documents that you have accumulated over the years. Putting your financial matters in a nice organized manner will give you peace of mind.  Did you not feel good when you finally finished  your “household” spring cleaning … everything now is where it belongs, the smell of bleach and lemon filling the air of the once cluttered rooms and that sense of relaxation after relieving that big inhale.   Now picture that same feeling (minus the smell of bleach and lemon) when it comes to getting your paper work in order.  No more asking yourself, “where is that form, I just had it the other day,” or misplacing your child’s field trip form that was supposed to have been signed a week ago.  On a serious note though folks, let’s just say you get audited – which means you’re going to have to pull out your tax returns along with all the information that was used to prepare that return – well do you know where it is?   Exactly.   Wouldn’t you feel a little relieved knowing that if anything like that ever happened that you would be more than ready?   Also, with the New Year and the start of Spring you may want to consider getting your finances together maybe start a wealth planning program or just get yourself on a budget.  With your paperwork in order it will make the process a whole lot easier.

Now, no one said this is going to be easy but having a checklist and a guide can take a lot of pressure off of having to do it yourself. Think of it as having your own personal assistant.  Now just like starting a business you have to start with a business plan.  You have to know where to start by knowing what you will need to make this process successful.  So to start off, below is a list of things you will need.  How cool is that!!

spring cleaning-page1

I suggest that you take 4 days to do this 4 step process.  But if you think you can get it done in one day go for it.   OK, here we go!

Step 1 – Gather ALL of your documents – (including unopened mail, receipts, bills, etc…).

Step 2 – Set up a filing system –  click here for a list of folder names that you can choose from depending on what you have.  This is where the labels come in handy.  Start writing the names on the tabs so you can later put them on the file folders or if you are going to scan just check mark the the folder tab names on the list so you can later entered them into your computer program.

Step 3 –  Separate – Now it’s time to get your posted notes out and label them with the following:  (1.)  File/Scan  (2.)  Bills To Pay  (3.)  Review  (4.)  Shred.  Spread the posted notes out and start separating your paperwork into the 4 piles.   If you do not know what papers to keep click here for the records retention schedule

Step 4 – File/Scan – It’s time to grab those labels (tabs) you previous made and start putting them on the filing folders (or start creating digital folders with the names you checked on the list into your computer program).  Once that is complete start filing/scanning.  Grab the papers in your “file/scan” stack and start separating them into the appropriate tabbed folders or start scanning them into the labeled digital folders in your computer program.   Next, grab your “bills to pay”  stack and put those in the “Bills to Pay” folder.   Now grab your “review”  stack and put them in the “Review” folder.     After you’ve put the documents in the correct folders it’s time to file them away into a file box or filing cabinet.  If you scanned your documents you can now  save the files onto your flash drive.   Finally, we come to the best part, the “SHRED” pile.  No need to explain that one but I’m going to: Shred with your shredder or burn in your fire pit whichever works best for you.  Just don’t throw them in the trash without being shredded (the trash bag is only to be used for the papers already shredded).   DON’T BE A VICTIM OF IDENTITY THEFT.

OK, you did it!  [High Five] Now don’t you feel GOOD!  I’m so happy for you.  This is the first step of getting your finances in order.

Well it’s been great sharing this information with you.  Until next time relax and have a wonderful day!


Affordable Care Act FAQS


The Affordable Care Act.  Yes!  That’s right I said it.  The AFFORDABLE CARE ACT which is also known as the Patient Protection and Affordable Care Act but for most it has been referred to as “Obamacare.” Whatever you choose to call it, it’s all the same.

I know everyone is sick and tired of hearing about this so I’m going to keep it short and simple by answering the most frequent questions from individuals. I mean that’s what everyone is worried about right – how will “Obamacare” affect my 2014 tax return? Here is a list of questions that everyone is asking.

1.) What happens if I can’t afford health care coverage?

You may get financial help to assist in paying for coverage, care, or both. The amount is based on your income, where you live, other coverage that may be available to you, and if you are a U.S. citizen or lawfully present in the U.S.
You can find out if you qualify for reduced premiums and reduced cost sharing through the Health Insurance Marketplace. Here are some general income guidelines that might be used by the government to see if you qualify and how much help you would receive.

If you’re single, you could qualify if you make less than $45,960 (or if you live in Hawaii, less than $52,920).
For couples, you could qualify if you make less than $62,040 (or if you live in Hawaii, less than $71,400).
For a family of 4, you could qualify if you make less than $94,200 (or if you live in Hawaii, less than $108,360).

2.) What is the penalty for not having health care in 2014?

If you’re required to have coverage, you’ll be charged a tax penalty by the government if you go without insurance for 3 consecutive months or longer. You won’t be charged the tax penalty if you are uninsured for less than 3 consecutive months. The penalty is $95/per adult and $47.50/per child for the first year or 1% of your AGI, whichever is greater (Maximum is up to $285 per family). If your household income is above 400% of the federal poverty level then you may be exempt from paying the penalty or if insurance in your area cost more than 8% of your taxable income (taking into account employer contributions or tax credits).

3.) How will “Obamacare” affect my HSA (Health Savings Accounts)?

1.) The law eliminated one’s ability to use money in their HSA account to buy over-the-counter drugs

2.) The big change is that the law increased the penalty for withdrawing funds from your HSA before you reach age 65. The early withdrawal penalty increased from 10% to 20%.

4.) Can I keep the plan I already have?

That will depend on when your current plan first went into effect – what we call the “effective date” of your plan.
If your plan has an effective date before March 23, 2010, you may have what’s called a “grandfathered” health insurance plan, and you may have the option to stay on that plan or change to one of the new metallic plans.   But, your plan will lose its “grandfathered” status if your insurance company makes significant changes to your plan that reduce its benefits or increase its costs (which you may want to ask before they go changing things to trick you into buying another health plan that you didn’t need) So please get educated on what you need.
If your plan has an effective date between March 24, 2010 and January 1, 2014, it is a “non-grandfathered” plan and it may have to be converted to a new metallic plan in 2014.
Even if your plan’s renewal date is later in the year, it may need to be converted to a metallic plan by no later than March 31, 2014 or earlier.
But, in some instances your insurers may make the conversion as early as January 1, 2014.
If your plan is purchased with an effective date of coverage that is after January 1, 2014, that plan would need to have one of the metallic benefit levels.

5.) What will happen if my application gets declined?

Insurance companies are NOT allowed to decline your application for health insurance because you have a pre-existing medical condition, or for any other health-related reason. Which started January 1, 2014.

We’ll I hope this answered some questions. We also have a page dedicated to this. Just click HERE to be directed. I’m here to make your life a little less complicated. Feel free to send me a question at

Have a wonderful and healthy day!


You’re Responsible For Your Tax Return



Hello Friends!  I’m having a WONDERFUL day and I hope you are as well.

I’m here today to speak to you about something very important about your tax returns.  Yes I know….BORING!  But this could save you penalties and keep you from receiving IRS letters, years later, yes I said years later.  So do I have your attention NOW!

Ok, let me start by saying YOU ARE RESPONSIBLE FOR YOUR TAX RETURN even if it was prepared by someone else.  By me saying that –  it means if your preparer files a false income tax return by claiming inflated personal and business expenses, false deductions, unallowable credits or excessive exemptions, that is considered return preparer fraud.  Some even manipulate income figures to obtain tax credits, such as completing a fraudulent schedule C with false income to obtain credits such as the Earned Income Tax Credit.  TIP: If you didn’t have a business and you notice a Schedule C within your income tax return you may want to ask questions.

Some of you (taxpayers) may not have knowledge of your tax preparer doing this but when the IRS detects the false return, the taxpayer “client” –not the preparer– must pay the additional taxes and interest and may be subject to penalties.

So be very careful when choosing a tax preparer.  Remember even if someone else prepares a tax return, the taxpayer is ultimately responsible for all the information on the tax return.

Don’t get me wrong tax preparers do get caught and in some cases get sentenced to prison. So if you suspect tax fraud or know of an abusive return preparer, report the activity using IRS Form 3949-A and send it to:  IRS, Fresno, CA  9388.  Don’t worry you’re not required to identify yourself, but it is helpful. Below are some helpful tips on choosing a return preparer.


  • Be cautious of tax preparers who claim they can obtain larger refunds than other preparers.
  • Avoid preparers who base their fee on a percentage of the refund.  Use a reputable tax professional who signs the tax return and provides a copy.
  • Consider whether the individual or firm will be around to answer questions about the preparation of the tax return months, or even years, after the return has been filed.
  • Check the person’s credentials. Only enrolled agents (EAs),  attorneys and certified public accountants (CPAs) can represent taxpayers before the IRS in all matters, including audits, collection and appeals. Other return preparers may only represent taxpayers for audits of returns they actually prepared.
  • Find out if the preparer is affiliated with a professional organization that provides its members with continuing education and resources and holds them to a code of ethics.

Well my friends it was a pleasure sharing this with you.  Please don’t hesitate to contact me for any reason at  or leave a comment.  Have a Wonderful Day! 





What is a “Rapid Refund?”


Hello Friends,

It’s that time of the year where some of you go to your local tax franchise and get your taxes completed so you can get that “Instant Refund.”  STOP!  Before you go and take that step again or should I be advising the first timers.  Either way let me explain what it really means to get that “instant” or “rapid” refund.

Getting an “Instant” or “Rapid” Refund means your getting the equivalent of your refund NOW instead of just waiting a couple of weeks for a check or seven to ten days to receive your refund via deposit to your bank account from the government.  But should we really call it a “rapid refund?”   No I don’t think so.  It is really a short-term loan from a bank in anticipation that they get your tax refund.  That’s why you have to fill out extra paperwork, including a loan application and a form releasing your refund to the ones who make the loan. Your refund will arrive straight to the lender to pay back what you owe. The fees and interest on these loans are considered predatory by consumer advocates making some preparers trying to inflate your refund to make borrowing against it more appealing because of the high fees at stake.

So why are you paying steep fees to borrow your own money?  I Mean you’ve waited a year without the money and your saying that you can’t wait a couple of weeks to get ALL your money back that you’ve overpaid to the government.  This is a bad way to start the new year of taking control of managing YOUR money.

Remember there are tax preparers who don’t charge to e-file your return and set you up for direct deposit.  Do your research.  Also, check out the IRS Volunteer Income Tax Assistant and Tax Counseling for the Elderly Program (VITA/TCE)  or call 1-800-906-9887 – they offer free tax help for taxpayers who qualify.

Have a productive day, friends!

Debbie Continue reading