The Internal Revenue Service (IRS) has announced the deadline for 2012 has been extended to Tuesday, April 17, 2012 because the fifteenth falls on a Sunday and a District of Columbia holiday “Emancipation Day” falls on Monday the sixteenth. According to federal law District of Columbia holidays impact tax deadlines in the same way that federal holidays do; therefore, all taxpayers will have two extra days to file this year.

Taxpayers who file extensions will have until October 15, 2012 to file their returns, however, you must ask for an extension by April 17, 2012.  The best way to file your taxes is to obtain the services of an experienced Certified Public Accountant (CPA) who can find all the deductions you may be entitled to. Their knowledge of the tax laws and rules can work to your best advantage if you disclose everything you did in 2011, including job changes, unemployment earnings, interest paid, interest earned, mortgage refinance, new children and sales tax on major purchases. Your tax professional may be able to provide you with a questionnaire or a list of potential deductions that you can check off your items and the list may jog your memory on something you may have forgotten about. I like to keep a 13” x 15” manila envelope near where I pay my bills and sort my receipts and I just drop the receipt or check copy that I think may be deductible and let my CPA decide if it is a proper deduction. Be sure to write on the receipt or check copy the details of the purchase. When in doubt, ASK!

The IRS has answers to your questions at www.irs.gov and advises tax payers to make sure their preparer has a Preparer Tax Identification Number (PTIN), which must be renewed each year.

Be honest! Be thorough! Be on time!

*Direct Quote from “The Constitution of the United States of America”.

Research material IRS.gov and the Constitution.

If you receive a 1099-C from any of your debtors from a bankruptcy discharge a taxpayer needs to file Form 982 to tell the IRS that this debt was included in your bankruptcy and should be exempted from taxation. Most tax debts will not be discharged in a bankruptcy, meaning after your case is over, and you will still owe any back taxes that may be due. The IRS will continue to accrue penalties and interest on your tax debt through your bankruptcy proceedings, so likely at the end when you are ready to settle with the IRS, your tax debt will be higher. Tax debts that are less than three years old cannot be included in bankruptcy. You must have filed tax returns properly for the previous four years before filing bankruptcy.

Tax refunds are considered income in the bankruptcy and in Chapter 7 cases they will be relinquished to the court. After chapter 7 cases are finalized, all you future tax returns are yours to keep and use as you see fit. Chapter 13 filers must usually pledge part or all of their tax refunds toward creditor repayment. After chapter 13 is completed, usually after three to five years, all future tax refunds belong to the debtor unless he owes newer taxes or defaulted on student loans. The bankruptcy estate is considered a separate entity and the trustee or debtor-in-possession is responsible for preparing and filing the estate’s tax returns and paying its taxes. The debtor remains responsible for filing their own returns and paying taxes on income that does not belong to the estate. The estate must obtain an employer identification number (EIN) for use in this regard. Anyone considering filing bankruptcy should obtain a copy of the IRS Publication 908 Bankruptcy Tax Guide to help you in your decision making and understanding your tax implications.

You should always consult with your tax professional to determine if this could pertain to your individual situation and your tax professional would be able to advise you and file your returns correctly.

*Research Material: IRS Publication 908 (Rev.Mar.09) “Bankruptcy Tax Guide”

You should be aware of “Cancellation of Debt Income” because it may have an impact on your tax liability due to the IRS Form 1099C that you may receive from a settled debt or lending institution should you have a foreclosure or short sale. There are several events in your life that could trigger a 1099C. In this day and age with so many homes in foreclosure and homeowners doing short sales on their homes, and overburdened credit card debt settlement, you must look for the tax liability you may face. This means when your lender or creditor completes your foreclosure or short sale your home or debt settlement the deficiency balance could trigger the lender to send you, the consumer, an IRS Form 1099C for the amount they “forgave”, if the cancellation of debt exceeds $600.

The creditor could be your lending institution, the holder of a personal note, a trustee for multiple owners of a single note or a governmental unit, but also includes individuals and business organizations of all kinds.  This form would be sent to the consumer by the 31^st of January of the year following the foreclosure or cancellation of debt. This form would need to be included with the information you give to your tax accountant or tax preparation specialist. The cancellation of debt amount would be determined by the difference between what you paid the lender or creditor and what the balance was at the time of the foreclosure or settlement. For example, if your loan was for $100,000 and it was settled for $80,000 then your 1099C would reflect $20,000 in taxable cancellation income. Another example, if your credit card company settles a $5,000 debt for $2,500 then your 1099C would reflect $2,500 taxable income. It is important to note that homeowners are not permitted under the IRS statutes to claim losses as a deduction due to foreclosure.

There are some exceptions to this rule and they include; Bankruptcy: Debts discharged through bankruptcy are not considered taxable income.  Insolvency: If you are insolvent when the debt is cancelled, some or all of the cancelled debt may not be taxable to you. You are insolvent when your total debts are more than the fair market value of your total assets. Insolvency can be fairly complex to determine and the assistance of a tax professional is recommended if you believe you qualify for this exception. Certain Farm Debts: If you incurred the debt directly in operation of a farm, more than half your income from the prior three years was from farming, and the loan was owed to a person or agency regularly engaged in lending, your cancelled debt is generally not considered taxable income. Non-recourse loans: A non-recourse loan is a loan for which the lender’s only remedy in case of default is to repossess the property being financed or used as collateral. That is, the lender cannot pursue you personally in case of default. Forgiveness of a non-recourse loan resulting from a foreclosure does not result in cancellation of debt income. However, it may result in other tax consequences.

You should consult with your tax professional to determine if this could pertain to your individual situation and your tax professional would be able to advise you and file your return correctly.

One of the best ways for people (potential clients) to find out about you, your company, and your products and services is public speaking. Yes, just opening your mouth.

It is a chance for them to get information straight from you. You are your best marketing vehicle. Speaking to groups is nothing more than a large conversation. It is powerful marketing–and efficient marketing.

A number of dynamics take place when you are in front of a group of people. First, you are the center of attention. Each audience member feels as if you are speaking directly to him or her.

• You’re not an envelope that goes unopened.
• You are not a telemarketing call that comes at dinnertime.
• You’re not a television commercial that gets fast-forwarded.
• You’re not a tweet that is so abbreviated you don’t even have a chance to sell your value.

Speaking to a group puts you at the forefront of message delivery and effective communication. You are having a conversation with an audience. Sure, members of an audience can walk out of the room, but of those present, you have their undivided attention. If all marketing could be delivered to “undivided attention,” we wouldn’t need as many marketing or advertising dollars at all.

So in today’s fast paced world, we don’t have very much time to truly sell our benefits to the general public, let alone our important potential funding resources or business stakeholders.  Thus the reason why we have chosen this time to talk about the “elevator speech’ and to fine time our own before this workshop is over.
Elevator speeches can make or break you. An effective 30 second or less sales pitch can give you an invitation to the bargaining table or a poorly worded reply will take you nowhere. It’s important to think of your short sales pitch or elevator speech as your commercial. You want to have a positive impact on prospective customers.

With proper planning and research, you should have a few different sales pitches tailored for different social situations and audiences.  There’s endless free training and tips on line on how to prepare your elevator speech; so take the initiative today so you will have a creative and savvy sales pitch tomorrow!

Network: Long gone are the long lazy business lunches of yester-year.  With today’s fast-paced environment, the art of networking has taken off in a big way to help businesses blossom.  Look into the variety of networking associations in your community.  Is there a Toastmasters Group?  How about a BNI Chapter?  Or perhaps someone has started a private networking group in your neighborhood.  Find out about the power of having your own sales team through a networking organization.

Get organized. Make time each day to prepare a list for tomorrow, and the week, and the month. There’s not a more effective skill to keep your business moving forward than having a “to do list” by your side.   Don’t even think of leaving the office at night without a new ‘to do’ list at hand and ready for action the next business day.

Prepare for the worst, and the best: Get your finances in shape.  If you need help, contact a local CPA.  Many of today’s accounting businesses are offering ‘virtual business office support’ – so take advantage of it. If you’re too busy to watch your books, or lacking the professional skills to keep your finances in shape – don’t wait.  Seek the advice of those who know it best so you can concentrate on your own best practices.

Take care of number one: No, not you; your customers.  Without the support of those who depend on you for your services and products, you won’t have a business next year.  Developing strong customer relationships are priceless in today’s economy.  They are your voice on the street and the answer to keeping your business thriving in years to come.   Need ideas?  Seek out free advice on line where you will find endless affordable and actually fun ideas to keep your customers coming back year after year.

Nurture your employees:  Although we believe the “Customer Comes First”, without happy employees, you won’t have customers.  It doesn’t take much to keep a staff enthusiastic when you keep them involved.  Every survey on job satisfaction continually notes that cash is not the end-all to happy staff; personal recognition, mentorships, education and team events usually top the list.

Although running a business takes a lot of hard work, when you plan ahead, delegate tasks to those who do the job best, and enjoy those around you, you have greater chances of succeeding and fulfilling that dream job that you now own.

Association and Business Fees: We all belong to at least one business organization and have day to day business expenses that are worthy of a write off.  Take note during the year on the costs you incur for local Chamber of Commerce fees, lunches, golf tournaments and the like.  Don’t forget about your monthly web hosting, trade publications and on-line subscriptions either.  If it’s related to helping your business prosper, you can write it off.

Office Equipment and Supplies:  Sure the paper stock and ink cartridges are worthy of a business expense yet don’t forget the annual costs to run your computer, printer and phones.  What about the new furniture you purchased or improvement to the kitchenette for your staff?  These all may be worthy of a write-off so do your research now.

Health Care: In the new world of entrepreneurship, there are plenty of new options for write-offs for your on-going health care.  Be it out of pocket expenses, a new pair of glasses, dental care or your monthly premium, check out these IRS guidelines here.

Delayed Billing: That’s right.  If you think you have made enough money to satisfy your needs, no one ever said you couldn’t delay your invoicing until 2012.  It’s possible to delay that income and still be fully legal in 2012.

Want more advice? Seek out a local CPA today to keep your money in the bank and away from Uncle Sam this year!