Tax News Updates | September 2024

• 2024 BTB Brochure Mailing
• Seminars Begin in This Month
• IRS Reopens ERC Disclosure Program
• Multi-Factor Authentication Becomes Mandatory
• Guidance Issued on QSLPS
• Tax Troubles
• Q4 Interest Rates
• September  Applicable Federal Rates
• 2024 Back to Basics Update
• 2024 Seminar / Webinar Dates and Locations 
• 2024 Desk Reference Guide
• State Tax Updates
• Viroqua Tax Practice For Sale
• Accounting Practice for Sale
• Kenosha & Racine Area – Client Referrals
• Area Stakeholder Liaison Teams
• Speaking Engagements
• The Tax Book – Promo Code 544
• CFS Tax Tools – Coupon Code BTB57143
• $50 Referral Bonus 

“The nation should have a tax system that looks like someone designed it on purpose.”

~  William Simon

Instructors 

James Hockenberry, EA – Jim is the President of Back to Basics Income Tax Seminars and has over 31 years of experience in income tax and financial planning. He is an Enrolled Agent and holds a Bachelor of Business Administration (BBA) degree from the University of Wisconsin-Eau Claire. He has worked as a tax researcher / technical writer and has served as an instructor for several tax and financial organizations. 

Steve O’Rourke, EA – Steve is an Enrolled Agent with a successful tax practice in Oshkosh, Wisconsin. His firm, which was established in 1989, prepares over 2,500 individual and business tax returns. Steve has a Bachelor of Business Administration (BBA) degree from the University of Wisconsin – Oshkosh. He has over 40 years of experience as a tax professional and is a nationally known speaker, having taught tax seminars for the National Association of Enrolled Agents, the National Association of Tax Professionals, and several other professional organizations nationwide.

2024 BTB Brochure Mailing

The 2024 BTB brochure was mailed out in mid-April.  If you did not receive a copy of the brochure – you can always go to the BTB website or click here for a copy. 

Seminars Begin in This Month

The 2024 BTB seminars start in September (Webinars begin in October). That’s right – summer is almost over. If you have not registered – now is the time to do it. For those with more than one person attending an event from the same office, don’t forget to take advantage of the group discounts.

We have launched a new website where you can now create and manage your own account.

1. On-line registration. Once your account is created you can then login and register for each event. Click here or the button below to get started.

2. Group registrations. To take advantage of the group discounts, we can help you with the process. Just use the link and fill out the group registration form, hit submit and we will complete the group registration for you.

If you have already registered, we will see you at the event. Just remember to bring your seminar confirmation letter with you to the seminar. For our full-day seminars and webinars, check-in begins at 8:00 am. Seminars start at 8:25 am and end at 4:35 pm.

IRS Reopens ERC Disclosure Program

The IRS announced a limited time reopening of the Voluntary Disclosure Program to help businesses fix incorrect Employee Retention Credit claims.

The Employee Retention Credit (ERC) Voluntary Disclosure Program (VDP) will run through November 22 and allow businesses a chance to correct improper payments at a 15% discount and avoid future audits, penalties and interest. To underscore the importance of participating in the Voluntary Disclosure Program, the IRS also announced it plans to mail up to 30,000 new letters to reverse or recapture potentially more than $1 billion in improper ERC claims. Thousands more mailings on additional questionable payments will be made in the fall. Click here for additional information.

Multi-Factor Authentication Becomes Mandatory

The IRS is reminding tax professionals that multi-factor authentication is now a federal requirement.

All tax professionals are now required under the Federal Trade Commission’s safeguards rule to use multi-factor authentication, or MFA, to protect clients’ sensitive information. The June 2023 change mandates MFA to strengthen account security by requiring more than just a username and password to confirm an identity when accessing any system, application or device.

Under the new FTC MFA rules, there’s a requirement to use at least two of the following factors for anyone accessing customer information: something a user knows like a username; something sent to them like numbers texted to a cell phone; or a physical part of them like a fingerprint or facial scan.

In addition, MFA should be used to secure client information on a tax pro’s computer or network, but it should also be used to access client information stored within their tax preparation software. MFA is required by law for all companies – not just tax professionals. The size of the company does not matter. Opting out of using MFA in tax prep software is a violation of the FTC safeguards rules.

Guidance Issued on QSLPS

The IRS has released Notice 2024-63, which provides interim guidance in the form of Q&As for sponsors of retirement plans, such as 401(k) plans, on making matching contributions on account of employees’ qualified student loan payments (QSLPs). The SECURE 2.0 Act provides that, for plan years beginning after 12/31/23, the term “matching contribution” includes employer contributions made to a defined contribution plan on account of employees’ QSLPs if certain conditions are met, and that QSLPs can be treated as elective deferrals or elective contributions for certain purposes. 

The notice provides the definition of QSLPs as well as information about which plans are eligible for matching programs, employee certification of payments, and reasonable administrative procedures. The guidance applies for plan years beginning after Dec. 31, 2024. For years prior to 2025, plan sponsors may either rely on Notice 2024-63 or use another good faith, reasonable interpretation of changes made by the SECURE 2.0 Act. The IRS intends to issue proposed regulations on QSLPs and invites general comments on all issues covered in the notice.

Tax Troubles

Court ordered payments to an ex-spouse aren’t always alimony. Joseph Martino wasn’t entitled to alimony deductions for pre-2019 payments to former spouse to discharge his obligation under pre-2019 divorce decree. Notably, operative agreement, as construed as whole, showed that payments were installment payments in discharge of property settlement. To that end, number of those documents contained explicit non-alimony designation in violation of former §71(b)(1)(B) , as they clearly set out original obligation separate from alimony provision and provided that later increases, after taxpayer defaulted, were to be tax free to former spouse.

The petitioner, Joseph Martino, claimed that he is entitled to alimony deductions because his 2017 and 2018 payments were “periodic” payments made directly to his ex-wife. But the manner in which the payments were made was not dispositive (or even relevant) under §71(b)(1)(B). The divorce decree included a “nonalimony designation” that ordered Martino to pay the marital property settlement in a lump sum. But he defaulted on that obligation, filed for bankruptcy, and became unable to pay his $3 million obligation in a lump sum. That is why the Superior Court in June 2010 imposed a new payment schedule, ordering that Martino discharge the $3 million property settlement obligation from June 2011 onwards by paying installments of “$25,000 per month until the full obligation, including interest, is paid in full.” The switch from a lump-sum payment to installment payments did not convert the property settlement to alimony. It was simply a consequence of Martino’s apparent inability to discharge his property settlement obligation in any other way. As a result, he was not allowed a deduction for the payments. Joseph A. Martino, Jr., T.C. Memo. 2024-18.

Q4 Interest Rates Unchanged

The IRS has announced that over/under payment interest rates will remain the same for the calendar quarter beginning October 1, 2024. The interest rates for the fourth quarter of 2024 are: 

• 8% for overpayments (payments made in excess of the amount owed), 7% for corporations.
• 5.5% for the portion of a corporate overpayment exceeding $10,000.
• 8% for underpayments (taxes owed but not fully paid).
• 10% for large corporate underpayments.

September Applicable Federal Rates

Rev Rul 2024-17

2024 Back to Basics Update

Website – New and improved website for better access to the newsletter and an improved registration system. 

Registration – In an effort to improve registration and CPE / CE reporting we need to have each participant register with his/ her own separate email address. The system is now designed to allow only one distinct email address per person. Your registration is your ticket to the seminar or webinar.

Note: Because of the strict continuing education requirements – each person will have to register separately even if you are part of an office group.

E-book Option – As always, all participants will receive a printed textbook for each session. However, if you prefer to go paperless, you can save $10 per session by selecting e-book only.

Webinars – Over 45% of our registrations are from Webinars – which tells us that more people prefer the convenience of on-line education. We have added additional dates and times for our on-line webinars this year – including an option that is more convenient for those in the Mountain time zone.

Seminar Locations – Due to the success of the webinars, the average classroom size for the in-person seminars has decreased. Unfortunately, this makes it necessary to consolidate a few of our seminar locations. For those who attended our prior seminars in Superior, Janesville, and Racine you will have to select one of our other remaining locations – or join us on-line.

Referral Program – We understand that referrals have always been the best way to grow a business. As a thank you, we will mail you a $50 referral fee for each new attendee who registers for a Back-to-Basics seminar.

2024 Seminar / Webinar Dates and Locations 

Registration is now available. 

2024 Desk Reference Guide

Now that the final numbers for 2024 have been released by the IRS, we have updated the Desk Reference Guide for the new year. Click here for your copy of the 2024 Desk Reference Guide.  

State Tax Updates

In mid-January we sent a link for the state tax updates. As a reminder, all Part II participants have the ability to view the Wisconsin and Arizona state updates for FREE. The state tax update programs will not qualify for continuing education credits. The link for the state updates included a recorded video, the written text, and PowerPoint slides.

If you did not attend the Part II session, you may purchase the state programs for $30 on our website.  

Viroqua Tax Practice For Sale

Tax and accounting practice for sale in Viroqua, Wisconsin. Loyal clients, good reputation, high-growth community in the heart of the scenic Driftless area of Southwest Wisconsin. Owner retiring after 30 years. Gross revenue $330K. 68% tax, 32% accounting. Average 1040 fee is $621. Exceptionally clean files and well-organized office. Two employees are eager to stay under new leadership. Owner willing to provide transition services. Excellent office location is available to be leased from the owner, if desired. 

For additional information, please contact celeste@gibsoncpalaw.com.

Accounting Practice for Sale

Northeast/central Wisconsin. $380,000 gross (sale price negotiable). Drake tax software, Quickbooks accounting software. Networked computers, all office equipment, 3,300 square foot office on main highway, available for lease or purchase.   Seller willing to provide multiple years of transition support.  

Reply to bkcpa@frontier.com for more details. 

Kenosha & Racine Area – Client Referrals

I have been attending the BTB seminars for many years.  I plan to retire from tax work after next tax season – April 16, 2025.  I have a small tax practice in Kenosha with about 75 clients.  I work alone, out of my home, so I have been able to keep my fees reasonable.  When I visit with my clients after the first of the year, I would like to help them find a new tax preparer for their 2025 taxes by giving them a list of available tax preparers.  If you are in the Kenosha or Racine area, and you are taking new clients, please contact me via email: peggyjgallo@gmail.com .

Area Stakeholder Liaison Teams

Speaking Engagements 

If your professional group is looking for outside speakers for an upcoming event – we can help. For additional information, please email jim.s.hockenberry@gmail.com 

The Tax Book – Promo Code: 544

Use Promo Code 544 for additional discounts and take advantage of The Tax Book’s award-winning tax research solutions. 

Order at: www.thetaxbook.com/order
Promo Code: 544

CFS Tax Tools – Coupon Code: BTB57143

CFS Tax Software, Inc.

Tax Tools is a collection of over 300 worksheets, calculators, flowcharts, and forms that tackle a variety of tough tax topics (many of which aren’t included in your 1040 software), including:

• Individual Tax Planner 
• ACA modules 
• Penalty and Interest Calculator 
• Social Security Optimization 
• Updated for latest tax law changes

You can order online at www.taxtools.com, or call 1-800-343-1157. Either way, be sure to use Coupon Code BTB57143 for additional savings.

$50 Referral Bonus

Refer a new attendee to a Back to Basics Income Tax Full Day Seminar and receive a $50 referral fee. Upon receipt of the new attendee registration(s), BTB Income Tax Seminars will mail you a check of $50 for each new attendee. Click Here to get a copy of the referral coupon.

(NOTE: Not valid with any other special offers or discounts)

Back to Basics Income Tax Seminars^® is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.nasbaregistry.org. Sponsor ID # 108520