California Assembly Bill 5 (AB-5) took effect on January 1, 2020, and is the new standard by which employers must classify employees. Small business owners (SBOs) should familiarize themselves with AB-5 and the ABC test to avoid employee misclassification and potential penalties from the Internal Revenue Service (IRS). What is… [Read more]
SBA PPP Loan Forgiveness Denial: The Ultimate Guide
The Small Business Administration (SBA) has forgiven over 98% of the total Paycheck Protection Program (PPP) loan value that borrowers requested them to forgive; recently, however, SBA has begun to issue more forgiveness PPP loan forgiveness denials. Many of these recent denials issued by the SBA are not consistent with… [Read more]
California CPA’s: Questions to ask your Clients to Reduce EDD Audit Risk
Certified Public Accountants (CPAs) have the most insight into their business owner clients’ daily transactional history. You may find that your clients who have 1099 contractors are now in the grey area of worker classification since it was redefined by AB-5 in January 2020. Under the new bill, all workers… [Read more]
How to Respond to IRS Letter CP 2000
What is a CP 2000? Watch our video below: IRS sends audit letters to taxpayers when tax returns and reported data from employers or banks do not match. This specific letter is IRS letter CP 2000. It is not a formal audit letter notice. However, it does notify the taxpayer… [Read more]
What Should You Pay for a Tax Attorney?
How much should you pay for a tax attorney? It depends on the issue you’re facing. If you’re a business owner, you can expect to pay a little bit more because these cases tend to have more complicated issues. Sometimes, cases can cost $2,000 to $3,000, but it depends… [Read more]
What Every Business Owner Needs to Know
Starting a business rarely begins with a strategic checklist of all of the resources necessary to run and scale successfully. Rather, many, if not most businesses start because the founder has a passion or skill that is exceptional and in-demand and they grow from there. Because of this, many business… [Read more]
Top 7 Most Common Questions About IRS Audits
Anytime you file taxes, there is a chance that your tax return might be audited by the Internal Revenue Service (IRS). The agency conducts standard procedures to find any errors or discrepancies among taxpayers. The audit process is meticulous and, should you find yourself under the scrutiny of IRS, will… [Read more]
Form 5472 Foreign Owned Company Filings
One important aspect of being a business owner is ensuring that you keep up with changing laws and regulations that may be applicable to your business. There are consistent changes and updates being made to various legal requirements and ignoring those changes or failing to recognize them could result in… [Read more]
Why IRS is Planning to Audit More Small Businesses This Year
Late in 2020 IRS announced that they intended to increase audits of small businesses by 50%. This news came as a shock to many small business owners who were still attempting to recover from the economic downturn brought on by the COVID-19 pandemic. While many businesses have struggled to hold… [Read more]
Insights for CPAs to Minimize Audit Risk for Their Clients
If you are a CPA, here are 4 things to help your client reduce the risk of an EDD, IRS, or SBA audit: 1. Confirm that your client’s 1099-K (provided by a merchant processor) does not report gross proceeds from credit card sales that are higher than the amount you… [Read more]