Here are the answers to some of the most
"Frequently Asked
Questions" our firm receives.
Question: What services do you provide?
Answer - We are a full service, certified public accounting
firm. We prepare tax returns including, but not limited to,
individual, corporation, LLC and LLP, non-profit, estate and
trust, partnership, payroll, sales tax, property tax, and
other taxes. We also sell computers and software as well as
offering training. We also provied full charge bookkeeping
services, payroll and monthly, quarterly and annual financial
statements.
Question: I would like to know the value of
my business. How can I determine this?
Answer – We can provide an in depth business
valuation and consulting service and would be happy to assist
you in this process. There are many reasons that business
owners need to know the value of their interests. These
include the purchase or sale of the business, buy-sell
arrangements, succession planning, shareholder disputes,
marital dissolution, estate and gift tax planning, to name a
few of the most common.
Question: Can you help me with my
investments?
Answer - We have financial advisors on staff who can help you
determine your goals and strategies. We can assist you in the
process of transferring your accounts to concur with those
strategies.
Question: What should I do with my payroll?
What alternatives do I have?
Answer: We have had very good success with recomending
outside payroll services such as PaySystems, Payroll One and
ADP. Depending on your needs, we can also process your
after-the-fact payroll in our office.
Question: I am concerned that my business is
not as profitable as I would like it to be. What can you do
to help me?
Answer - We offer an operational auditing program where a
team of our professionals come into your business to assess
your company's operational strengths and weaknesses. We
breakdown your business into the areas that are mission
critical and offer recommendations (that we can help you to
implement!) to get your business on track. Organizational
efficiencies and profitability structuring are the keys to
your business working FOR YOU rather than vice versa.
Question: What should I do about a
retirement plan? Can you explain the various plans
available?
Answer - A good retirement plan can be an essential weapon in
your arsenal for accumulating wealth. I will go out on a
limb...Every business owner with taxable income from some
source (whether from the business or not) should have a
retirement plan to help defer taxes and to accumulate savings
tax free! We can help design the PERFECT plan for your
business and your circumstances. Give us a call so that we
can further discuss your interest.
Question: What are your hours and are you a
seasonal company?
Answer – During tax season (January 1, through April
15), we are open Monday through Friday from 8:30am to
5:00pm. Saturday hours are from 8:30am to
2:00pm. Most days, staff and partners can be
found here much later than our standard hours, but we
encourage clients to call first before making the trip unless
the information can be put through the mail slot. Our summer
hours are 8:00am to 4:30pm. Our extended hours reflect our
commitment to offer our services at a time most convenient
with our client's.
Question: What is a reasonable
wage for S corporation owners? (11-12-02)
Answer - Ideally, the best way to set pay is to use an
amount comparable to an individual being paid similar rate in
your industry. Otherwise, I use a standard rule of 50\50.
Basically, 50% of income available to owners should be taken
as wages and the other 50% should be taken as dividends.
Question: Which items qualify for a
cafeteria plan deduction? (11-15-02)
Answer - The main items consist of Qualified dependent care
costs, disability income * accidental insurance, group-term
life, dental, & health insurance premium costs, and
medical cost not covered by insurance. Any unused amounts in
a particular category are lost by the employee and reverts to
employer by the end of the plan year
Question: Do I need to visit your office to
have my taxes prepared?
Answer – Although we encourage an intrapersonal
relationship with our clients, it is not necessary to visit
our office to have your return(s) prepared. Many clients
utilize the mail or express services to send their
information to us. For new clients, we encourage a meeting so
that we can discuss your unique tax situation.
Question: How do colleges calculate student
financial aid?
Answer - Colleges calculate student financial aid awards by
calculating the college’s cost of attendance (COA) and
then subtracting the expected family contribution (EFC). Any
remaining amount may be funded with financial aid. Other
considerations are how early the financial aid application is
filed and the particular school’s available financial
aid resources.
Question: What size clients do you
serve?
Answer - Small to medium size manuafcturing to physicians to
manufacturers reps, etc. Please see a complete listing under
Diversified Clientele which can be accessed from our Home
page.
Question: What size clients do you
accept?
Answer - All potential clients are evaluated on thier
individual needs.
Question: Can I deduct student loan
interest?
Answer - Since personal interest is generally non-deductible
must meet several tests: You must be the person liable on the
debt and the loan must be for education only. Your income
can't exceed $130,000 on a joint return or $65,000 on a
single return; married couple filing separately can't deduct.
You can't deduct if you're claimed as a dependent.
Question: Can I save tax by filing a
separate return instead of jointly with my spouse?
Answer - You sometimes may benefit from filing separately
instead of jointly. Consider filing separately if you meet
the following criteria: One spouse has large medical
expenses, miscellaneous itemized deductions, or casualty
losses. The spouses' incomes are about equal. Separate filing
may benefit such couples because the adjusted gross income
"floors" for taking the listed deductions will be computed
separately.
Question: Do we service clients outside of
the East Detroit area?
Answer - We have several clients in Birmingham, Bloomfiled
Hills, Grosse Pointe, Livonia, Warren, Roseville, St. Clair
Shores, Detroit, Bay City, Harbor Springs, Burt Lake, and
many other areas of Michigan. We also serve clients out of
Michigan and have tax software to prepare returns in all
states.
Question: How do you charge for your
services and how does your cost compare to other tax
preparation firms?
Answer - We charge by the hour. It is difficult to give exact
quotes due to the complexity of some tax returns and
unforseen issues. We do however. try to keep our costs as low
as possible so that cost savings can be passed on to our
clients. Over the years, we have found our fees to be
competitive and on the low side of other quality firms our
size.
Questions: Do you work with Start-up
Companies?
Answer - Yes! Many of our clients are just starting in
business. We will lead you through the necessary governmental
forms. Through our networking, we can also assist in finding
you other necessary professionals to deal with (lawyers,
insurance agents, mortgage brokers, etc.) throughout the
state.
Question: I want to start a new business.
Can you tell me which type of business I should form?
Answer - Yes. When setting up a new business, it is
crucial to set up the right type of business, such as
corporation, S corporation, limited liability company,
limited liability partnership, partnership, sole
proprietorship, etc. Our consulting services will help you
form the right type of business based on your unique
situation with consideration given to liability issues and
tax advantages.
Question: How are Limited Liability
Companies (LLC) taxed?
Answer - A single-owner LLC defaults to being taxed as Sole
Proprietorship. Income/loss from the LLC is reported on the
owner’s personal income tax return. A multi-member LLC
defaults to being taxed as a Partnership. A Partnership tax
return must be filed. The profit or loss is then reported on
the owner’s personal tax return. Any LLC can elect to
be taxed as a corporation. To do so, one must file an
election within 75 days of creating the LLC.
Question: Is there any non-tax record that I
should keep?
Answer - There are other records you should keep, even though
they don't appear to have any use for your tax returns.
Family documents, certain medical records, insurance
policies, records of major purchases, are just a few
examples. These documents will be needed in the case of any
emergency that may arise.
Question: Should I keep my old tax returns?
If so, for how long?
Answer - Yes, you should keep your old tax returns for at
least 7 years. When a return contains information pertaining
to the basis of property owned, it should be kept until that
property is sold. One of the benefits of keeping your tax
returns from year to year is that you can look at last years
return while preparing this years. If you do throw out an old
return you may fill out form 4506, Request for Copy or
Transcript of Tax Form, and send it to the IRS service center
where you filed your return.
Question: What pieces of paper do I need to
keep in order to do my taxes?
Answer - Keep detailed records of your income, expenses, and
any other information you report on your tax return. A good
set of records can help you save money when you do your taxes
and will be a trusty ally in case you are audited. We
require the following documents for preparation:
--Forms W-2 for wages, salaries and tips
--All Forms 1099 for interest, dividends, miscellaneous
income, etc
-- Brokerage statements showing investment transactions for
stocks, bonds, etc
-- Schedule K-1 showing income from partnerships, S
Corporations, estates and
trusts
-- Statements supporting deductions for mortgage interest and
taxes including student
loan interest and educational
expenses
--Any tax notices sent to you by the IRS or other taxing
authority
--A copy of your income tax return from last year, if not
prepared by this office
--A copy of taxpayer/spouse/dependents Social Security
Card(s) for e-filers
(unless already provided in 2003)
--A copy of a check (marked void) from your checking account
if you wish to direct
deposit. We will need this prior to
preparing the return. We can not change the
return after you sign the PIN form without
re-runing the return and passing the cost
of doing so on to you.
--The Data Sheet which provides a summary of accurate
personal information
--Client Questionnaire completed with pertinent tax items
necessary for preparing
an accurate return
Question: How do I know when certain taxes
are due?
Answer - You can give us a call or check out the Due Date
Calendar on this website.
Question: What is the Social Security wage
base and rate?
Answer - The wage base is $87,000 for 2003, up from $84,900
in 2002. The FICA rate remains the same: 7.65% for employees
and 15.3% for self-employed individuals. The Social Security
portion is 6.2% of wages up to the wage base. The Medicare
portion is 1.45% (2.9% for self-employed) of wages with no
ceiling.
Question: What is the standard mileage
rate?
Answer - The standard rate is 36.0 cents/mile in the year
2003. The rate was previously 36.5 cents/mile for 2002 and
34.5 cents/mile for 2001.
Question: What is the unified credit shelter
amount?
Answer - The applicable credit amount for estates of
decedents dying during 2002 or 2003 is $345,800, which would
shelter $1,000,000 from gift and estate taxes. For 2004 and
2005, the credit increases to $555,800, sheltering $1,500,000
from estate tax, however, for gift tax purposes, the
exclusion remains at $1,000,000.
Question: What is the annual gift tax
exclusion?
Answer - The annual exclusion is $11,000 for 2002 and 2003,
per donee, with an annual maximum of $22,000 per donee
applicable to spouses who utilize gift splitting.
Additionally, there is an unlimited exclusion for payments of
tuition and medical expenses.
Question: Where can I get additional
information about IRS e-file?
Answer - You can visit the IRS website at www.irs.gov - or
feel free to call our offices to ask us questions as well
(734-429-7172).
Question: What are your fees?
Answer - Fees vary based upon the work being performed.
Our policy is to charge, for tax and accounting work, a
rate ranging from $45.00 to $125.00 per hour depending
on the staff level required to complete the project.
Estates and trusts are billed at higher rates due to the
complexity involved in preparing the returns. This rate
range is $65.00 to $155.00 per hour. Due to the amount of
work involved in processing an Individual Income Tax return,
our minimum fee is $250.00.
Question: Do you work with Start-up (new
companies)?
Answer - Yes! Many of our clients are/were new entrepreneurs
that are just starting in business. We will lead you through
the necessary governmental forms. Through our area
networking, we can also assist in finding you other necessary
professionals to deal with. (lawyers, insurance agents,
mortgage brokers).
Question: What records do I need for a CPA
to file my tax return?
Answer - A tax organizer is provided for your convenience,
that contains most of the items which you will need. However,
a detailed record of your income and expense items will be
required to support our entries and in addition, a record of
any other items reported on your tax return. Since totals of
each category of income and expense will help us save time
and cost, it is the preferred method of information
submission
Question: Can I deduct child support
payments?
Answer - No. Child support payments are not deductible,
because they represent a pre-existing legal obligation to
support your children
Question: In a divorce who is entitled to
the child dependency exemption?
Answer - The parent who had custody of the child for the
greater part of the year is generally treated as the parent
who provided over one-half of the child's support and will
claim the exemption if other tests are met. Custody is
usually determined by the divorce, separate maintenance or
custody decree or agreement. If no decree or agreement
establishes custody, then the parent who had physical custody
for the greater part of the year is entitled to the
exemption
Question: What is the most tax efficient way
to save for my children's education?
Answer - The educational savings area is very complicated. We
at recommend that taxpayers seek professional assistance.
Although a Section 529 plan, under the 2001 Tax Act, is an
extremely flexible and tax effective plan, there are other
plans to be considered. Also when considering any educational
savings plan, consideration should be given to the impact on
financial aid qualification requirements
Question: How do colleges calculate student
financial aid?
Answer - Colleges calculate student financial aid awards by
calculating the college's cost of attendance (COA) and then
subtracting the expected family contribution (EFC). Any
remaining amount may be funded with financial aid. Other
considerations are, how early the financial aid application
is filed and the particular school's available financial aid
resources
If we can be of further service, please do not hesitate to
contact our office.