is almost coming to an end and income taxes are coming. In
this most unusual tax season of 2015,
all Americans will be seeing changes on their tax returns.
Congress continues to discuss last minute income tax bills as
of the date of this letter, and you can be assured we stay
abreast of all the latest changes as they occur!
As usual, we will make our tax organizers available, for free,
to anyone who requests one. If you have not used one in the
past, please call the office to
request one for 2014, as it is our attempt to be as
thorough as possible in the preparation of your return.
If you received an organizer last year, we will mail this
year’s organizer to the same address.
The tax organizer may not be enough however, and we wanted
to bring some special items to your attention below.
Affordable Care Act
All Americans will be affected in some manner by the
Affordable Care Act from 2010 (some people call it Obamacare).
5 new tax forms were released by the IRS as a result of this
act for 2014. If you received a Form 1095 from any issuer or
agency, we MUST
have all copies to prepare your tax return. If you don’t
receive a 1095, we must
ask you a number of additional questions about insurance
coverage so that we can help you avoid any penalties for
failure to have health insurance. The new 5 forms may add some
additional fee to this year’s tax preparation bill, courtesy
of the Affordable Care Act and the estimated 1-3 hours of
additional time on our part to get things right.
Health Care Deductions
Last year’s tax bill reduced your deduction for medical costs,
including health insurance for 2014. We will see very few
deductions available for medical costs now unless you have
substantial bills. The amount of your medical expenses in most
cases must now be more than 10% of your income before we can
deduct anything, so weigh carefully whether to go to the
trouble of summarizing these costs. If you are self-employed,
we still need to know how much you paid for health insurance.
ALL deductions of any amount must have a receipt. Any
individual contribution over $250 must also have an
acknowledgement letter from the charity, and the letter must
be dated by the date we file your return. The letter should
show the date and amount of any individual contribution over
$250 and should also state that no goods or services were
received in return for the contribution.
If you have read any news in the last year, you know that the
IRS is looking closely for offshore accounts. If you have an
account, retirement account, or business interest with a value
over $10,000 in a foreign country, or a foreign business
ownership (not through a mutual fund), please let us know as
some special rules will apply to you. There are substantial
penalties for failure to disclose these items.
We must obtain Form 1098 from you when you pay mortgage
interest. Additionally we must obtain refinancing closing
statements, and if you drew money out on a home mortgage or
refinancing we must have general information on the use of the
money according to the IRS.
Under absolutely no circumstances can you allow your dependent
children or college students to file their own returns this
year. We must file
their return because of the Affordable Care Act. Allowing a
child to file their own return, particularly a student, can
cost the child and parent literally thousands of dollars in
Health Care penalties and/or credits.
If you own rental property, this year the IRS has demanded
substantially more information. We now need,
FOR EACH PROPERTY SEPARATELY,
the physical location, the type of property (single-family,
duplex, etc), and Forms 1099-K received, and a record, by
property, of the number of days rented and the number of days
used for personal purposes.
Roth IRA Conversions
You will be continue to hear from lots of “experts” this year
that you need to convert your retirement accounts to Roth
IRAs. While there are a number of advantages to conversions,
there are an equal number of disadvantages that carry some
major tax consequences. Please do not convert your accounts in
2014 without coming in to see us for an appointment to discuss
both the positives and negatives. All
conversions for 2014 must be completed by December 31, 2014.
Effective 1/1/2013, the amount you may give to one person in
one year without any return filing requirements was increased
to $14,000. Very, very few Americans need to worry about
Federal estate taxes because of changes in the estate tax
limit at the Federal level.
If you are in what the press has called the 2% club, be aware
that the rest of America will soon be joining you! When the
surtaxes on this group of Americans were passed, Congress
purposefully did not adjust the thresholds for inflation, and
in 6 years, over 50% of all Americans will pay these surtaxes
based on estimated inflation rates. Begin planning now whether
you are a 2% club member or not by -in order- maximizing 401-k
contributions; utilizing employer-sponsored cafeteria plans to
their fullest limit; investigating and using employer
sponsored fringe benefits such as child care and education;
turn in job expenses for reimbursement; and consider your
marital status as your income increases because of the
incredible marital penalty built in to the surtaxes.
There is still time to setup an appointment for year-end tax
planning by November 31. We recommend a meeting if you have
had any major changes during 2014 or are expecting major
financial changes in 2014 or 2015, such as retirement,
Future Income Tax Rates &
We highly recommend that when you are getting your information
to us for your 2014 Federal tax return, that you set an
appointment for an after tax season “Tax Tune Up” to examine
tax and estate planning strategies. If your income is over
$200,000, it is almost mandatory that we meet for future tax
planning because of surtaxes.
If you receive any Form 1099-k, please be sure to bring it to
us. It may have a direct impact on your return.
There are literally hundreds of other changes, extensions
and deletions that we will consider this year while
preparing your 2014 return. Because of these changes, we are
requesting everyone to try to have their tax information in to
us at least two weeks earlier than normal, and no later than
March 21, 2015. Please rest assured that we will utilize our
best resources to once again provide you with timely, complete
and accurate service while keeping your tax burden to the
lowest legal amount. Thank you again for your continued
Again do not hesitate to call us at
925-634-2344 for your tax organizers if you have not used
one in the past, as it is our attempt to be as thorough as
possible in the preparation of your return.
SMEED CPA Adds Financial
Services To Help Clients With
Investments & Insurance
often we here at SMEED CPA are asked about financial issues
that impact our clients investments and their portfolios.
We always offered our opinion and suggestions but in order to
help our clients actually execute the changes we suggest,
SMEED has created a Financial Services division.
SMEED Financial Services, Inc. will be able to
work with both individual and business clients on their
investment portfolios and manage assets on their behalf.
SMEED Financial will include Michael Uadiale,
ACA, CPA, CGMA; and Pablo Blanco who has
recently joined SMEED and comes with over 18 years of
financial sales and advising experience with affluent
Watch your inbox and mail boxes for more specific information
on services SMEED Financial Services, Inc will make available
Would You Give Me Your
Feedback & Testimonial
on Our Hotline?
Hello it’s Michael Uadiale, CPA of
SMEED CPA Inc. We’ve just installed a toll-free
number that I would like for you to call and tell me how you
think we are doing as your CPA firm.
Just dial 800-609-9006
extension 3638 and follow the instructions. If we’ve
done a good job please let me know. And if we can
improve on anything, please mention that too.
Us Be Found on
Also as we expand our business,
we find more and more people are using
YELP and Google
to look for us by searching Brentwood accountant or
When they do this we want to
be FOUND on GOOGLE. One way you can help us
is to give us an
ONLINE REVIEW on our Google Maps/Places listing --->
or on our YELP local listing
click here to go to our Google Listing for SMEED CPA and
click on the
YELP link to go there.
Scroll down to the Review area.
On either site it may say: Been here?
Rate and review
You will click on the Rate and
review link and then log in, then
give us a review!
You can choose between 1 and 5
STARS and write in what you think about the tax or accounting
work we have done for you.
It's that simple. Thank
you in advance for your help and cooperation!
As always you can call our offices if you have any
questions about these or any other accounting related issues, at
Regards, Michael Uadiale, CPA,
Managing Partner, SMEED CPA,