Miriam Klamkin, E.A.

02/20/2026

Used to getting a refund check from the IRS? You might want to go a different route this year.

The federal government is phasing out check payments. They want everything done electronically.

Guidance is fluctuating hard and fast on this. If you got a letter from me early in January describing the new policy, read on, because the plan has already changed.

For now, you can still get an old-school paper check, if you're willing to wait for it. If you don't provide a bank account on your tax return, or if your bank doesn't recognize the number you gave as yours, you'll get a letter - a CP53E notice - in the mail.

You respond by logging into your online IRS account, and either indicating the correct numbers or providing a reason why you can't. If the IRS doesn't hear back from you in 6 weeks, they'll issue a check.

If you don't have a bank account, there is a workaround. Get yourself a debit card that has a routing number and account number associated with it (not to be confused with the card number). And don't lose the card.

Down the road? Who knows?

The upshot: for this year at least, provide your bank account's routing number and account number to your tax advisor or tax software, or, as they say, expect delays.

Oh - if you owe the IRS, you can still pay by check. They'll be happy to take your money.

01/09/2025

Happy 2025, everyone! I hope you enjoyed the holiday season. Now it's back to business for us all - including tax reporting. I'm especially looking at you, rental property and business owners.

If you hired outside help in 2024 - any kind of contractor, professional, temp worker, or service provider who was not on the payroll - you most likely need to provide that person with Form 1099-NEC, and copies to the IRS and the state taxing authority. This filing is due January 31.

There are a few exceptions:

* your service provider is a corporation

* you paid via a third-party payment processor such as PayPal, Venmo, Zelle, Square, Stripe, Worldpay, etc.

* you paid this contractor less than $600 over the course of the year

Otherwise, you're on the hook for reporting. Let me know ASAP if you'd like my help.

10/25/2024

In case you haven't heard, the Commonwealth of Massachusetts has declared a tax amnesty period from November 1 through December 30, 2024.

First, the good news: the amnesty applies to almost everyone who owes taxes or filings to the MA Department of Revenue, including income, sales, corporate excise, and several other tax types.

Now the bad news: they're not waiving your taxes, only late penalties, and you'll still pay interest on the tax due. To qualify, you must file any missing returns for the past 3 years, and pay any tax you owe for any year, during the amnesty period.

To check your eligibility and learn how to request the waiver, go here:

https://www.mass.gov/info-details/massachusetts-tax-amnesty-2024

Wishing you all the luck if this applies to you!

The Massachusetts Department of Revenue will administer a tax amnesty from November 1, 2024, through December 30, 2024.

09/14/2024

Hey y'all,

This could be you! This Monday, September 16:

Your quarterly estimated taxes are due

Your extended partnership return is due

Your extended S-corp return is due

You know where to find me if you need last-minute help!

07/22/2024

Finally, the IRS has firmed up the inherited IRA rules!

If you inherited an IRA account in 2020 or since, you're likely to be confused about whether and when you have to take money out of it, a rule known as required minimum distributions, or RMDs.

Actually, the rule was confusing before that, and now that there's a different rule for newer heirs, it's even more confusing.

The new rule, if you don't qualify for an exception, sounds simple: you have to withdraw all the money in the 10 years following the year of the original owner's death. So if someone passed away in 2020 and left you their IRA, you must have the last penny out of it by 2030.

Exceptions apply for a bunch of folks, so check with me on that first.

For the rest of us, the question the original SECURE Act failed to address was, are there RMDs for this, or can you just leave the money there until the 10th year, or what?

Guidance has been delayed all this time, and in the meantime, the IRS has waived any penalties that you may or may not have incurred if you just left the money in there until now.

HOWEVER, starting in 2025, penalties will apply. So it's time to wake up and start paying attention.

First of all, this is (except for some Roth IRAs) taxable income. The penalty for NOT taking your RMD is separate from the taxes you owe when you DO take it. Back in the day you paid 50% of your RMD amount. Now it's 25% in most cases.

Remember, the 10-year clock started ticking the year after the death. The waiver doesn't affect that. So in that case where the original IRA owner died in 2020, if you, the beneficiary, haven't started withdrawing money, you have 6 years - 2025 to 2030.

The way RMDs work, the less time you take to withdraw the total amount, the more you must withdraw each year. So the sooner you start, the less you take out each year, which could result in lower taxes overall. In other words, it may benefit you to start this year, even though you don't have to.

As you can see, this "simple" rule can be really twisty, so check with me if you're still not sure what's required of you or what's best.

07/15/2024

Hope you're all enjoying your summer! In case you haven't heard, there's a new report some businesses need to file by the end of the year. The Financial Crimes Enforcement Network (FINCEN) of the US Treasury Department is now requiring them to report on their "beneficial ownership". This means you if you're:

an LLC

a corporation, including an S-corp

or any other entity required to file with your state's Secretary of State

you're on the hook for this. Exceptions include all nonprofits and other tax-exempt entities, and a few other less common cases, but most of the above businesses will have to report.

The initial report is due January 1, 2025, and substantial penalties apply if it's late.

If you started your company in 2024, you have 90 days to submit your report.

Once you've submitted your report, you don't have to file again unless any of the information changes. Then you have 30 days after the change occurs.

A "beneficial owner" is anyone who owns or controls at least 25% of a company OR exercises "substantial control" over the company, e.g. a senior officer, an important decision maker, etc. Ownership interests are usually fairly straightforward, but "substantial control" may be less easy to determine.

The report must be filed online at:

https://www.fincen.gov/boi

You can find more details on that site.

Many companies are required to report information to FinCEN about the individuals who ultimately own or control them. FinCEN began accepting reports on January 1, 2024. Learn more about reporting deadlines.

05/03/2024

Have you received a random small refund from the IRS lately? It could be a return of your estimated tax penalty. You pay this when you file return, when you haven't paid enough during the year. They expect you to be paying all year, either by having taxes withheld from your income, or by making estimated payments on your own.

If you lived in a federally-declared disaster area, and were eligible for an automatic extension, that time to pay your taxes was extended as well. Several of my clients have received refunds of that little penalty. It's a nice little bonus. If you get such an unexpected amount, check it against the penalty listed at the bottom of your Form 1040. Then go out and spend it!

04/02/2024

There's been a little confusion around the tax due dates this year. (Can you say Mercury Retrograde?) So I thought I'd clarify.

FBAR filers (that's those of you who have assets outside the US): April 15, regardless of where you live.

IRA contributions: April 17 for MA and ME residents, April 15 for everyone else.

Tax returns for individuals, C-corps, trusts, and estates: same - April 17 for MA and ME residents, April 15 for everyone else.

S-corps and partnerships: your deadline was March 15. If you didn't file, and didn't file an extension, get it in by April 15 and stop the clock on penalties.

Expats get until June 17 to file their returns, but IRA contributions must be done by April 15.

02/20/2024

Things my tax clients don't know can help them this year:

Energy-efficient home improvements - Congress passed a bill substantially expanding the credits for qualifying exterior windows and doors, heat and AC equipment, insulation, air sealing, as well as solar, wind, geothermal, battery storage, and fuel cell installations. If you had any of this done in 2023 (or anytime through 2032), check with me to see if it can lower your taxes.

Charitable contributions - Massachusetts allows a deduction for these now, even if you don't itemize your federal deductions. Anything other than used clothing or household goods could qualify.

Water bills - if you're over 65 and live in Massachusetts, I can add these to your property tax to help claim the newly augmented Senior Circuit Breaker Credit.

02/08/2024

If you have an eTrade account, you may know that eTrade was acquired by Morgan Stanley in 2020. Your account was transferred to Morgan Stanley Smith Barney in September 2023.

Why do I care? Because you're probably getting two tax statements for 2023, one from eTrade and one from MSSB.

If you only get one, check the dates of any activity (dividends issued, stocks purchased or sold, etc.) listed on it. The entire year's activity should be represented.

Be sure to bring both statements to your tax preparer, to ensure that all your income is shown on your tax return and you won't receive a nastygram from the IRS down the road. I can show you exactly which gray hairs on my head are attributable to this sort of thing.

This has been a public service announcement on behalf of tax preparers everywhere. Thank you for reading.

02/03/2024

I do taxes for a living, and given the deep, dark labyrinth that is the US tax code, I've seen firsthand that most people benefit from working with an experienced professional to get their taxes done every year. However, if your budget just doesn't accommodate that, and doesn't have room for any of the numerous private DIY online services, the IRS has your back. Some of these options have income limits or other qualifications, so check before you sign up.

There are the VITA (Volunteer Income Tax Assistance) and TCE (Tax Counseling for the Elderly) programs, where you meet with a preparer in person, usually at a local social service organization. Appointments can be hard to get, and the preparers' skill sets can sometimes be somewhat limited.

The IRS has had an online Free File program for years, working with companies such as H&R Block, Turbo Tax, and the like. You have to start from the IRS site:

https://www.irs.gov/.../free-file-do-your-federal-taxes...

They're also in the process of rolling out their own free file program, called Direct File. Of course they're late getting started, and not all states are participating right now, but they're saying it will be ready by mid-March.

https://directfile.irs.gov/

Those two programs walk you through the process, as long as know your way around a computer or cell phone.

There's also Fillable Forms, if you feel confident that you know every form you may need to file. This one will NOT walk you through and will NOT file a state return for you:

https://www.irs.gov/e-file-providers/free-file-fillable-forms

And of course, even if you're filing on your own, check with me if you just have a quick tax question. I'm usually able to answer it for you, especially this early in the season.

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