QuickBooks Bookkeeping - Accounting

Kathryn C. Tiffany, LLC: located in Voorhees, New Jersey. We provide a wide variety of services such as bookkeeping, accounting, business and financial management tailored to meet the needs of each of our clients. 

Our services are designed to make our client’s job easier and to provide them with more time to focus on building their business. In doing so, we are happy to be able to refer our clients’ businesses to others.

Member of the American Institute of Professional Bookkeepers, National Association of Certified Public Bookkeepers, Intuit QuickBooks Advisor Program, Association of Certified Fraud Examiners, Voorhees Business Association, and Chamber of Commerce.

Cash vs. Accrual Accounting Methods

Under IRS definition, an accounting method is a set of rules used to determine when and how income and expenses are reported.

Normally for IRS purposes, the accounting method; cash vs accrual is chosen before you file the first business income tax return. It must then be used on a consistent basis for the life of the business, unless changes in the business occur that statutorily necessitate a change in the accounting method. If you wish to change methods for particular reasons of your own, you must get written permission from the IRS.

When you bill the client, when you actually receive the money and bank it, and when the job and its guarantees reach completion can each define when you have to report the income.

Normally, you calculate your income and expenses by using three major methods: 1) Cash Method; 2) Accrual Method; or 3) Hybrid Method in which select elements of cash and accrual are combined.

The Truth About Tax Records: An Index Card Can Make or Break You: Put your records in order now to cope with a potential IRS challenge

The Wall Street Journal
By Laura Saunders
March 5, 2016 1:00 a.m. ET


Working on your tax return? Put your records in order now to cope with a challenge from the Internal Revenue Service down the road.

To see the difference proper proof makes, consider the results of two Tax Court cases released in December. In the first one, the judge ruled that a business consultant owed more than $23,000 in taxes and penalties for 2010 and 2011 because he didn’t have convincing records of write-offs for wages, travel, meals and entertainment.

The same week, another judge ruled that a couple who owned a small business could deduct nearly $7,000 in mileage expenses for business travel in 2010—even though their records were handwritten on index cards, and some were missing.

“The better your records, the less agita you’ll have with the IRS,” says Ed Mendlowitz, a CPA with accounting firm WithumSmith+Brown who is based in New Brunswick, N.J.

The tax rules on record-keeping have a surprising history. In the 1920s, the entertainer George M. Cohan—who wrote the songs “(I’m a) Yankee Doodle Dandy” and “Give My Regards to Broadway”—deducted more than $50,000 for travel and entertainment related to his profession, including “entertaining” drama critics. Mr. Cohan didn’t have receipts for many of the expenses, so the IRS denied them.

In 1930, however, the celebrated jurist Learned Hand ruled that Mr. Cohan’s lack of records didn’t bar him from taking deductions, as long as they had a basis in fact and could reasonably be estimated. His pro-taxpayer decision became known as the Cohan Rule.

Congress has since whittled away Mr. Cohan’s tax legacy by enacting stiff standards for some deductions, especially ones subject to abuse. As for the IRS, its gold standard for write-offs without receipts, such as miles driven in one’s own car for business, is “contemporaneous records.” That means notes made when the expense was incurred, such as a log recording miles driven.

But IRS agents and judges also can accept good-faith estimates and other forms of proof for write-offs. Because the couple in the December case kept timely records on index cards, the judge allowed their testimony regarding some missing cards.

As you make your way to this year’s April deadline, here is record-keeping advice from experts.

Avoid charitable-donation pitfalls. Current law is both clear and rigid: taxpayers who make cash contributions need proper proof of the donation in hand before filing their returns in order to get a deduction. If the taxpayer gets the proof only after filing, the IRS could disallow it.

Proper proof of a cash donation typically consists of a letter from the charity giving its amount, date and the value of anything (such as a tote bag or dinner) received in return. That value must be subtracted from the deduction.

The rules for other types of donations, such as property, are also persnickety about proof. In a famous 2012 case, a California couple lost an $18.5 million deduction for property donated to charity because they didn’t have the correct records. The judge acknowledged that the decision was harsh, but said the law left him no choice. For more on substantiating charitable deductions, see IRS Publication 526.

Take care with T&E. Large deductions for travel, meals, and entertainment are often an audit magnet, so treat them carefully. Taxpayers are supposed to keep records showing who, what, when, where, and why; experts say the one people most frequently forget is the “business purpose” of the activity. Suggestion: when setting up a meeting that will include deductible expenses, record the business purpose at the same time.

For details on travel, meals and entertainment deductions, see IRS Publication 463.

Update records for your home. Did you add a room to your home this year, install new windows, or add a deck? Such investments can increase your “cost basis” in the home, which could lower the tax bill when it is sold.

For example, say a couple bought a home for $100,000 years ago in a high-growth area such as Seattle. If they sell it for $700,000, the law allows them to avoid tax on $500,000 of their $600,000 profit—so they would owe tax on $100,000. If, however, they invested $75,000 in improvements over the years, their cost basis rises by that amount and they would owe tax only on $25,000 of profit.

For more about what qualifies as an investment in a home, see IRS Publication 523.

Know when to toss. How long do you have to keep tax records? The law has various statutes of limitations, but Mr. Mendlowitz offers a rule of thumb: Keep tax returns (plus substantiation) for seven years. And for assets held outside tax-favored retirement plans, keep records of their cost until seven years after the asset is sold. That, of course, can be a very long time. 

Source:  http://www.wsj.com

▬ ▬ South Jersey Bookkeeping, QuickBooks and Accounting ▬

Kathryn C. Tiffany, LLC is a certified bookkeeping and QuickBooks firm. We identify opportunities, provide solutions and deliver exceptional personal service to small and midsize businesses as well as individuals. Our services include bookkeeping and QuickBooks accounting for individuals and businesses.

Unlike other bookkeeping/accounting firms, we go beyond these traditional services and provide our clients with many other business services. Our clients have the advantage of having a trusted certified bookkeeper who knows their overall financial condition.

If you believe that an bookkeeping firm should do more than just QuickBooks, then you've come to the right place. At Kathryn C. Tiffany LLC, we offer a variety of services for businesses so that they can operate much more efficiently, as well as cost effectively.

Our bookkeeping, and accounting services include the following:

Accounting -- Regardless of whether you need monthly or annual accounting support, we will work with you in order to ensure that your needs are being met. At Kathryn C. Tiffany LLC, we provide accurate and timely financial reporting and advice for you and your business, as well as accounting software (QuickBooks) training and support services. We will even provide you with ways to customize QuickBooks software in order to fit the specific needs of your company.

Bookkeeping -- While bookkeeping can be critical, it is also a time consuming task -- and one for which most business owners just simply don't have the time to devote. Our bookkeeping services include financial statement preparation, reconciliation, and more. Outsourcing your business's bookkeeping can make good financial sense, as it can reduce your overhead expenses, as well as the demands on your own personal time.

Payroll -- Payroll can be yet another time-consuming task for a business owner -- and one in which outsourcing can also make a great deal of sense. Doing so can be beneficial from a time and a cost perspective. This is because there is no need to maintain your own payroll system, or even a specialized individual to handle this task. In addition, because payroll laws are always changing, remaining in compliance can often become a challenge when businesses maintain this role on their own.

Partnering with a firm that can provide you with a variety of reliable services can help your company and allow you to concentrate on running and growing your business. 

For more information on how Kathryn C. Tiffany LLC can work with your business, contact us.

Let's Talk About Simplifying Your Bookkeeping

CALL NOW for a free initial consultation--at your office and convenience--to discuss your needs and how we can best serve you.

Kathryn C. Tiffany, LLC Bookkeeping Services
Certified QuickBooks ProAdvisor
Bonded and Insured
Telephone: (856) 803-4651
Email:Kathryn@TiffanyAccounting.com
Web: http://www.TiffanyAccounting.com
Intuit QuickBooks Profile: http://proadvisor.intuit.com/quickbooks-help/kathryn-tiffany 

Forensic accounting and bookkeeping – a means to end fraud & an excellent career choice

Catching thieves ingenious enough to stealing millions of cash from companies, or bringing down the notorious mob bosses in history. These endeavors do not require anymore a superhero with powers, but can be taken care by a mild-mannered accountant in the swiftly rising field of forensic accounting and bookkeeping.

Forensic accounting is one of the most rewarding and exciting career choice available. Even though, most people perhaps not know precisely what being a forensic accountant entails.

Understanding Forensic Accounting

The forensic accounting makes use of accounting skills to investigate embezzlement or frauds and to analyze the financial information, which further use in legal proceedings. It is a specialty practice area that explains engagements fall-outs from anticipated or actual litigation or disputes.

The forensic accounting centers around two main zones – investigation and litigation support.

- The litigation support entails the figuring out the amount lost by parties in a legal contest, and also appear as an expert witness in trials to testify.

- The investigative job role requires the combination of both skills, detective, and accountant. An accountant who has a thorough knowledge of financial measures and capability to think deductively is an ideal fit for this role. The key task of a forensic accountant on investigation part is to identify employee securities fraud, theft, and insurance fraud or identity theft, etc.

Who hires forensic accountants, or/and auditors?

The variety of institutions employs forensic accountants including, police forces, government agencies, insurance firms, financial lenders, courts, attorney and law firms, banks, business owners and credit unions, etc.

Typically, they employ forensic accountants based on their qualification and experience. Even, in some instances, they hire them based on their neutrality to the particular situation, if damages are involved.

Job description of forensic accountant

A forensic accountant can be involved in the broad array of investigations. They may comprise:

1. Partnership's and shareholder disputes

Such conflicts require a detailed analysis of several years of accounting records to reach a collective dispute resolution, including – benefit and compensation disputes of partners and shareholders.

2. Business interruption

Such investigation entails reviewing particulars of insurance policy. Business interruption research is primarily focused on enquiring employee dishonesty, property losses claims and other coverage issues. Also, forensic investigation defines appropriate methods of calculating losses in such areas.

3. Matrimonial disputes

In such disputes, forensic accountants evaluate assets like properties, businesses, and other personal assets.

4. Mediation and Arbitration

Situation where forensic accountants are involved in an alternate dispute resolution so that companies and individuals reach to a joint resolution with a nominal amount of time and with a minimal disruption.

5. Criminal investigations

In criminal investigations, the job of a forensic bookkeeper is to represent the evidence in the form of a concrete, concise and professional report.

6. Personal Injury claims

Forensic auditors are asked to enumerate economic damages and often calculate resulting financial losses resulting from accidents, wrongful dismissal, and medical malpractices.

7. Fraud investigation
Such study requires forensic accountants to trace funds, asset identification, and recovery. Commonly, performed in employee fraud cases.

8. Professional negligence

The forensic bookkeeper will investigate through a loss quantification, or breach in an agreement.

Forensic accountant's workflow

Each forensic auditor or accountant is assigned with the unique assignment with each client, but every accountant follow the same structure.

- Conduct initial meeting with client to understand the significant people, facts and issues on hand

- An efficient conflict check is performed

- Preliminary investigation is completed

- Build an action plan containing – objectives to be
achieved and methods to be used to accomplish them.

- Acquire relevant proof of occurrence of an event, or other evidence including, assets, economic information, and documents, etc.

- Preparing a final report

Qualification of Forensic accountant

The licensed forensic accountant must have minimum bachelor's or preferably master's degree in accounting or related field. Besides relevant education and licensing a forensic accountant also must have following personal characteristics –

-Confidence
-Strong communication and organizational skills
-Creativity
-Persistence
-Capability to make sound personal judgments.

Source: http://www.selfgrowth.com

Time to change bookkeepers/accountants?

Do you grab your chest when you open your accountant's/bookkeeper's bills?
We offer low fees.

Do you feel shunned by your bookkeeper/accountant when you call his/her office?
We offer "on call" 24/7 availability.

Tired of seeing a new face handling your account each year?
We offer personal service.

Do you find yourself auditing the work of your bookkeeper?
We offer quality workmanship.

Can't remember the last time your bookkeeper discussed his/her findings?
We offer unlimited consultations.

When you receive your financials, is it already time for next year's?
We offer timely completion.

Do you break out in a cold sweat worrying about an IRS audit?
We offer precision tax preparation.

Allow us to do your bookkeeping so you can do what you do best: your business! Consider the benefits of outsourcing all of your bookkeeping work to us.

Compare our fees to those of other certified bookkeepers and save thousands of dollars every year in accounting/bookkeeping fees!

Kathryn C. Tiffany, LLC
Call Today!  856-803-4651

Extra Payroll in 2015

If you pay weekly or biweekly, you may have an extra pay period in 2015 ... 27 payrolls instead of 26 or 53 instead of 52.  The extra payday can have both financial and legal repercussions if not handled correctly.

Most calendar years have 26 biweekly or 52 weekly pay periods.  For biweekly payers, this 27th payroll occurs only every 11 years; for weekly payers, the 53rd payroll occurs every 5 years.

But if biweekly payers distribute only 26 biweekly paychecks in Leap Years, they are paying employees for only 364 days, instead of 365 or 366.  Therefore, every 11 years, biweekly payers need an additional pay period to cover the unaccounted-for days.

There is generally no problem with hourly employees because they are paid for hours worked.  But if you pay exempt employees biweekly, may could end up this year with unintended extra pay because of the extra pay period.

Example:  John's salary is $100,000 a year, so his biweekly pay is $3,846.  If you don't recalculate his pay, you will pay him $103,842 (27 x $3,846) because of the extra pay period.

What to do
Divide each exempt employee's annual salary by 27 or 53 (instead of 26 or 52).  But let employees know ahead of time.  If you do not notify employees, they may think that their pay has been cut and that can create morale problems which may lead to legal challenges that are costly even if you win.  For instance, in 2015, John would be paid $3,703 each pay period ($100,000/27) instead of his usual $3,846 and may wonder why you cut his pay.

Once you have informed exempt employees, you must still recalculate their biweekly pay on a case-by-case basis, especially if your firm has any employment agreements.  These may contain language that prevents the recalculation of payroll period wages.

To avoid potential legal problems, before making any announcements or recalculating any salaries, review employee letters, contracts or other documents that set compensation,  When a specific weekly or biweekly amount is stipulated, you may want to consult a labor lawyer.

Leasehold Improvement - also known as tenant improvements

Alterations made to rental premises in order to customize it for the specific needs of a tenant. 

Leasehold improvements include painting, installing partitions, changing the flooring, putting in customized light fixtures and so on. 

Leasehold improvements can either be undertaken by landlords, who may offer to do so to increase the marketability of their rental units, or by the tenants themselves.

Temporary leasehold improvements undertaken by tenants can be removed at the end of the lease period, as long as it is stipulated in the lease agreement, and removal would not inflict any damage on the rental premises or building structure.

A leasehold improvement is classified as an asset that can be depreciated by the landlord over time. While the useful economic life of most leasehold improvements is 5 to 10 years, until 2004, the Internal Revenue Code required that depreciation for such improvements occur over the economic life of the building, or 39 years. 

Tax legislation enacted in 2004 reduced this depreciation period to 15 years; however, the 15-year depreciation schedule is temporary in nature and must be reauthorized annually. 

Allowance Method To Write-off Bad Debt

Allowance Method

The allowance method records an expense to bad debt using an estimate of accounts that are unlikely to be collected before specific customer accounts are identified as being uncollectible. 

The estimate is determined by management and is based on a percentage of accounts receivable or sales.

The percentage rate may be based on historical trends, economic trends or some other form of measurement. 

The method uses a contra-asset account to accounts receivable ... allowance for doubtful accounts, to maintain the estimate of accounts that will become bad debt. 

The account is adjusted as accounts are written off.

Recognition Entry

The first step in the allowance method is to pass an adjusting entry at the end of an accounting period to recognize estimated bad debts expense. 

Unlike direct write-off method, we do not credit accounts receivable at this stage because it is actually a control account of many individual debtor accounts and we do not yet not know which particular debtor will make a default. 

We only know the estimated amount of receivables which are likely to end up uncollected. 

Therefore a provision account called allowance for doubtful accounts is credited in the adjusting entry.

Thus:

Bad Debts Expense  600

Allowance for Doubtful Accounts 600

The bookkeeping hiring test: Hire a bookkeeper that is experienced and qualified

A trained bookkeeper is capable of bookkeeping functions like recording transactions and reconciling accounts. 

You may consider giving your prospective candidate a bookkeeping test. Check out this free bookkeepers hiring test from the American Institute of Professional Bookkeepers.

Kathryn C. Tiffany, LLC Bookkeeping Services

Kathryn C. Tiffany, LLC  Bookkeeping Services provides the support, objectivity and expertise businesses need to succeed within the context of an ever-changing business landscape. We offer a broad spectrum of bookkeeping, accounting, QuickBooks consulting services across a number of industries to give business owners and managers the insight they need to prosper.

Kathryn C. Tiffany, LLC  has over 30 years of experience serving small and middle market companies. As an licensed, insured and bonded bookkeeping firm, Kathryn provides bookkeeping and accounting services to many New Jersey, Delaware and Pennsylvania companies. 

Kathryn’s bookkeeping and accounting services professionals provide its clients with value added accounting and outsourcing services including QuickBooks services for your business.

SCOPE OF SERVICES
 
Bookkeeping/Accounting

Kathryn C. Tiffany, LLC  is committed to excellence in client service. We are driven by a set of core values to ensure a positive client experience. These are:

• Financial statement preparation: reviews and compilations 
• Monthly, quarterly, and annual financial reporting statements 
• Implementation of new accounting software packages
•  Bill paying services
•  Business management
•  Payroll and sales taxes
•  Accounting assistance
•  Bookkeeping
•  General ledger review
•  Financial assessment reports
•  Business start-up consulting
•  Budgeting and forecasting
• General business consulting

Accounting Outsourcing

    Accounts payable/receivable
    General ledger accounting
    Account reconciliations
    Fixed asset management
    Month, quarterly and year-end closings
    Payroll tax and sales tax return preparation
    Cash flow management
    Implementation of new accounting software packages.

Contact

Phone: (856) 803-4651

E-mail: Kathryn@TiffanyAccounting.com

Located in Voorhees, New Jersey

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