PRESENTER: Charles E. “Chuck” McCabePresident and CEO, Peoples Income Tax

Chuck founded Peoples Income Tax in 1987 after 19+ years as an H & R Block executive and serves as President and CEO. Peoples operates income tax offices throughout central-Virginia and provides income tax school and tax practice management systems to independent tax firms nationwide, and offers online tax courses nationwide. Chuck has conducted tax practice management seminars for several professional associations including the National Society of Tax Professionals (NSTP), the National Society of Accountants (NSA), and the National Association of Tax Professionals (NATP). He is coauthor of two nationally distributed books on career education for adults and numerous published articles on adult education and tax practice management. He is President of Peoples Income Tax School and served on the Dean’s Advisory Council of the School of Continuing Studies at the University of Richmond. Chuck has also served on the Executive Committee of the VA Career College Advisory Board and has taught tax preparation and small business management at several colleges, including Hofstra and Virginia Commonwealth University.

PRESENTER: Catherine A. Mueller, EA, CTPDirector of Peoples Tax and Business ServicesCathy Mueller is an Enrolled Agent, licensed to represent taxpayers before the IRS. She has also held Series 7 and 66 securities licenses. She is a member of the National Association of Accountants and a past member of the National Association of Enrolled Agents and the Virginia Society of Enrolled Agents, where she served as chair of the VSEA Education Committee. She has earned designations of Chartered Tax Professional, from the Income Tax School. She has also completed the advanced education in taxpayer representation to become a Fellow of the National Tax Practice Institute. Cathy has done extensive work with small businesses in tax consulting, tax preparation, accounting and operations management.

Before joining Peoples, she worked for 15 years for U-Tote’'M of Virginia, Inc., where she advanced from Accounting Clerk to General Manager and then President of the 17-store chain, until the company was sold in 1992. Previously she had held various accounting jobs, and she was also self-employed providing Accounting, Tax and Business Consulting services for small businesses.

Legislation

• Tax Extenders????– 50+ expired provisions

• State and local sales tax, tuition deduction, teacher’s expenses, research and energy credits

– Congressional Discussions

– HR 5771 passed—1 year ext.

– Senate ??– Veto Threat – Efile Start Date???

Legislation

IRS Regulations

Section 7216 Taxpayer Consent

to Disclose Information

Mandatory Language

Rev. Proc. 2013-14

General Education Information

IRS Preparer Regulations• Annual Filing Season Program (AFSP)• Voluntary—Appear in Public Directory • Consent to Adhere to Circular 230• AFTR-Annual Federal Tax Refresher Course

– Record of Completion– Pass AFTR Comprehensive Test– 18 Hours CPE Annually

– Filing Season 2015—11 hours

Annual Filing Season Program

Circular 230 RevisionsSection 10.36 Procedures to Ensure Compliance

Applies to “any member of firm management subject to Circular 230

Adequate Procedures to Ensure ComplianceDue Diligence: Competency StandardDuty of firm management to ensure members of the firm

are compliant with personal tax obligationsCovered Opinion Rules

Email disclosure statement no longer necessary

Must have reasonable basis for advice

ACA Implications• Client Education

– Year-end Letter» Information to bring to appointment» Explain 1095A, 1095B, 1095C

• Telephone Calls• Additional Staff Training• New Forms to Prepare

• Longer Preparation Time

• Increased Fees

ACA Resources• IRS Best Practices Information

– Individual Shared Responsibility Provision• http://www.irs.gov/pub/irs-utl/Best%20Practices

%205000A.pdf

– Premium Tax Credit• http://www.irs.gov/pub/irs-utl/Best%20Practices

%2036B.pdf

• Beyond the Basics • http://www.healthreformbeyondthebasics.org/

Electronic Signatures Forms 8878 and 8879

• Software Provided Acceptable Methods – Electronic Signature Pad– Stylus used on Display Screen– Digitized Image of handwritten signature– Typed name in electronic record (ex: website

form)– Digital Signature– Shared Secret – Mark captured as graphic

Electronic Signatures Forms 8878 and 8879 (cont.)

• Software Must Record– Digital image of signed form– Date and time of signature– Taxpayer’s computer IP address (Remote transaction– Taxpayer’s login identification– Identity Verification—must pass knowledge passed

authentication tests (remote) or confirm government ID verified

– Method used to sign

Electronic Signatures Forms 8878 and 8879 (cont.)

• Identity Verification Methods– In Person Transactions

• Must validate taxpayer identification unless a multi-year business relationship exists

• Examine government issued picture ID

– Record name, SSN, address, DOB• Must be able to separately identify each taxpayer

– Remote Transactions• ERO must record name, address, DOB,SSN• Software must verify identity thru external methods (ex credit inquiries)

• Software may use knowledge based verification methods

• Software must interact with tax records so that signatures may not be transferred.

Systematic Operating Methods

Systematic Operating Methods

Policies & Procedures Personnel Policies

Tax Preparer Staffing• Shortage of Tax Preparers

– Preparer Regulations– Preparers Retiring

• Recruiting Tax Preparers– Homemakers with young children– Early retirees– Other prospects

• Training New Tax Preparers– Operating a Tax School– Online Tax Course

Tax Preparer Staffing (cont.)

• Continuing Education– Tax law updates– Advanced courses– Small Business courses

• Scheduling Tax Preparers– Minimize “dead time”– Monitor productivity

• Employment Agreements– Non-compete provision– Non-solicitation provision– Confidentiality provision

Client RetentionCauses of Low Client

RetentionPoor client serviceInadequate communicationErrorsNon-retention of tax preparersTransient clientele

Retention Rate GoalsEITC ReturnsForm 1040Business Returns

Corrective MeasuresTrainingQuality Control

Quality Control

• Checking Tax Returns

• IRS Due Diligence– Training

• Client Service– Professionalism– Tax Planning

• Secret Shopper– Checklist Report

– Pay in Cash

Technology• Computer Equipment

– Used PCs– Dual monitors– Scanners

• Computer Systems– Networks (LAN, WAN)– “Cloud” systems– Data Back-up Systems

• Communication– Internet Service– VoIP Phones

• Virtual Tax Service• Secure File Transfer Process

Website Marketing

Basic Website Information Company Info, Bios Company News Releases Company Contact Information Taxpayer Resources & Links Tax Tips e-Newsletters (archived)

Interactive Website Features Interactive Tax OrganizerOnline Tax ServiceWebinars (play on demand)Videos IRS e-servicesTaxpayer FilesTaxpayer ForumsAppointment Scheduling

Tax Preparation Software

FunctionalityAll statesCorporate returnsBank products

LimitationsStabilityExporting data

SupportChange Vendors?

Training, learning curvePoor supportErrors, lost data, downtime, e-filing glitches Cost

• IRS Legislation and Regulations• Systematic Operating Procedures• Tax Preparer Training• Client Communication • Marketing• Planning• Staff Meetings• Review systems, procedures and

execution• Technology Needs• Tax Software

 • Special Offer• SAVE 65% On Original Prices of Tax Practice 

Management Manuals - Use Code ACCTODAY• SAVE 15% On eLearning courses - Use Code 

ACCTODAY2

• Offer Details: Offer ends 12/17/14. Not valid with other offers or on previous purchases.

• www.TheIncomeTaxSchool.com

• 1.800.984.1040

For More Information ContactFor More Information Contact::

Charles McCabe CMcCabe@theincometaxschool.comPresident and CEO, Peoples Income Tax

Catherine Mueller, EA,CTP cmueller@peoplestax.comDirector of Peoples Tax and Business Services