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Join us for a Financial Literacy Seminar on the New Tax Law

The Tax Cut and Jobs Act was signed into law in December 2017. What does this mean for you? Join us on Thursday, March 15 from 3:00-4:00 p.m. at our Hatfield location for our first Financial Literacy seminar of the year: Personal Wealth Opportunities under the New Tax Law. We’ll identify personal wealth opportunities and discuss some recommended tax savings strategies resulting from the new tax law that may benefit you. During this seminar, you’ll learn about:
  • Tax law changes affecting 2018 returns
  • Applying those changes as applicable for your benefit
  • Long-term strategies moving forward

Richter Mobile Shredding will also be on-site for you to safely dispose of any old or unwanted documents. Plan on arriving a little early or staying after the seminar to participate in this shredding event.

If you cannot attend in person, we encourage you to join us for this seminar via GoToMeeting. All you need to do is click here shortly before 3:00 p.m. to join the meeting and follow the instructions to join us via your cell phone, tablet or computer. You may also join us via phone by dialing 312-757-3121. The access code is: 457-847-797.

Canon Capital Management Group Names Brent Thompson, CPA, CMA, CGMA to the Firm as Unitholder

We are proud to announce the admission of Brent Thompson to the firm as a unitholder. Brent joined our Accounting business unit, Canon Capital Certified Public Accountants, in 1998.

Brent is a Certified Public Accountant (CPA) and earned his Bachelor of Business Administration degree from Temple University. In addition to holding his CPA designation, Brent also holds Certified Management Accountant (CMA) and Chartered Global Management Accountant (CGMA) designations.

Brent’s role as a Manager on the CPA team includes providing management advisory services, tax and general business planning, tax preparation, and financial statement preparation and review services for our numerous small-to-medium-sized business clients.

“Brent has demonstrated excellent leadership and personal commitment to our mission for many years,” said Michael Witter, managing director of Canon Capital Certified Public Accountants and co-founder of Canon Capital Management Group. “His dedication to high standards in goal-centric client services is proven, and we are proud to welcome him as a unitholder.”

Brent also shares Canon Capital’s commitment to the community. He has served on the Economic Restructuring Committee of Souderton-Telford Main Streets and the Stewardship Committee at Keystone Fellowship. He currently sits on the board of the Indian Valley Chamber of Commerce, serving as Treasurer.

Born and raised in Souderton, working for Canon Capital has been a homecoming of sorts for Brent. “It’s been a great fit for me personally and professionally. The firm’s expertise and structure have enabled me to become a much more valuable advisor than had I pursued a career at a firm specializing only in tax accounting.”

He adds, “Having the privilege to work with such an exceptional director group has truly been a blessing. Their integrity is second to none and is evident in the culture they have created here at Canon Capital. I’m thankful for this new opportunity to serve as a unitholder and look forward to working with the directors to develop the next generation of Canon Capital’s employees and clients.”

Beware a New Kind of Tax Scam

Cybercriminals are stepping up their game this tax season. The IRS is reporting a new kind of tax scam that began only a few days into this year’s filing season. It involves stealing data from the computers of tax preparers and using the data to file fraudulent returns.

“In a new twist, the fraudulent returns in a few cases used the taxpayers’ real bank accounts for the deposit. A woman posing as a debt collection agency official then contacted the taxpayers to say a refund was deposited in error and asked the taxpayers to forward the money to her.”

Here at Canon Capital, we take every possible precaution to ensure that your data remains safe and secure. Steps that you can take to protect your personal data include these steps:

  • Use strong, unique passwords. Better yet, use a phrase instead of a word. Use different passwords for each account. Use a mix of letters, numbers and special characters.
  • If an email contains a link, hover your cursor over the link to see the web address (URL) destination. If it is not a URL you recognize or if it is an abbreviated URL, don’t open it.
  • Use security software to help defend against malware, viruses and known phishing sites and update the software automatically.
  • Send suspicious tax-related phishing emails to phishing@irs.gov.
  • Do not return or click on emails or return a phone call from someone saying they are from the IRS. They simply do not work that way.

If you have any questions about this or any other topic related to your tax planning, we are happy to help. Call 215-723-4881 or contact us online.

New Requirements for Pennsylvania Businesses Working with Out-of-State 1099-MISC Vendors and Subcontractors

If you operate a Pennsylvania-based business and engage with subcontractors and vendors on a 1099-MISC basis, there is a new requirement from the Commonwealth of Pennsylvania. Effective January 1, 2018, “payors of non-employee compensation or rent to non-resident individuals or their SMLLC’s must withhold Pennsylvania income tax at the rate of 3.07% of their payments.”

What does this mean? For Pennsylvania-based businesses engaging with subcontractors and vendors located outside of Pennsylvania who operate as an individual or an “SMLLC” (single member limited liability company), and to whom your annual payments will total above $5,000, you are responsible for withholding Pennsylvania income tax on their payments at a rate of 3.07%.

Since this is new, penalties for non-withholding were delayed until the end of the second quarter of 2018. If you are not certain as to whether you will meet the $5,000-plus criteria, the state is recommending you remit the withholdings.

7/2018 UPDATE:
It is recommended that you provide PA form REV-1832 to all your vendors. Have them complete the payee information and exemption reason as applicable. If the completed REV-1832 is not received with an appropriate exemption, you should withhold PA income from those non-resident vendors to whom you pay $5,000 or more annually. Completed form REV-1832 should be maintained for your records.

If you have any questions about this or any other topic related to financial or IT services, we are happy to help. Call 215-723-4881 or contact us online.

IRS Standard Mileage Rates Increase for 2018

The IRS has announced standard mileage rates for 2018. As of January 1, 2018, the standard mileage rates for the use of a vehicle (car, van, pick-up truck, or panel truck) for business, charitable, medical, or moving purposes are:

  • 54.5 cents for every mile of business travel driven (an increase of 1 cent from the 2017 rate)
  • 18 cents per mile driven for medical or moving purposes (an increase of 1 cent from the 2017 rate)
  • 14 cents per mile driven in service of charitable organizations

We’ve touched on the importance of keeping good mileage logs and recommend using a mobile app such as TripLog or MileIQ. It’ll save you a lot of time and stress as you gather your financial data for tax preparation.

We’re happy to answer any questions you might have about this or any of your financial service needs. Call 215-723-4881 or contact us online.

Canon Capital Computer Solutions Named Calyptix Security Corp. 2018 Premier Partner

Phishing attacks, ransomware, and cloud storage are just a few of the cybersecurity concerns facing small business owners as we enter the new year. Hackers work tirelessly to outwit and infiltrate online protections. It is our job to stay steps ahead of these criminals to ensure that your information is protected and that your business continues to run smoothly.

That is why we are proud to announce our continued designation as a Premier Partner by Calyptix Security Corp. This designation is based on the criteria of Canon Capital Computer Solutions meeting the Calyptix standard of commitment to superior IT support and services to our customers and for accelerating growth in network security services for the small and medium businesses we serve.

This partnership with Calyptix gives us the advantage as we protect the key components of your business – payment systems, payroll, workstations – anything residing on your network, allowing Canon Capital Computer Solutions to give you even greater peace of mind and flexibility in your business operations.

If you have questions or would like to schedule an assessment of your network, we are always available to you. Call 215-723-4881 or contact us online.

Tax Filing Season is Officially Open

Yesterday — Monday, January 29, 2018 –- marked the first day the IRS began accepting tax returns for the 2017 tax year. This year’s deadline to file your taxes is Tuesday, April 17. BusinessInsider.com has this recap on what you can expect for this year’s filing.

Keep in mind that the changes that come with the new tax law do not apply to your 2017 tax year returns. As always, our team of CPAs are here to help. Contact us with any questions.

Free Tax Reform Webinar: What Church Leaders Should Know for 2018

2018 is underway and with this new tax year comes a number of changes to the tax law. What does it mean for your church and your staff?
 
We’re here to help. That’s why we’re inviting you to attend this free webinar — Tax Reform and Tax Law Changes: What Church Leaders Should Know for 2018. This hour-long webinar, presented by Church Tax & Law church attorney and CPA Richard R. Hammar will cover what churches and church leaders need to understand about these changes for 2018 and beyond. As always, if you have any questions about your payroll and taxes under these changes, please contact us.

Prepay Your Property Taxes? It Depends

You’ve probably seen or heard news reports about prepaying 2018 state and local real estate taxes in reaction to the recently-passed Tax Cuts and Jobs Act.

With this new legislation, beginning in 2018, taxpayers will be allowed to deduct up to $10,000 of state and local taxes paid, including property taxes and either income taxes or sales taxes. The bill will preserve the deduction for existing home mortgages and cap it at $750,000 for newly purchased homes starting January 1, 2018. The plan will also end the deduction for interest on home equity loans.

So, can you prepay your 2018 real estate taxes in 2017? Yes, and no. If you live in Montgomery or Bucks counties in Pennsylvania, the answer is “No.” Montgomery County has posted the following statement on their website:

The county has received a number of inquiries from individuals seeking to prepay their 2018 county real estate taxes. While the county understands and supports these efforts, Montgomery County is not permitted under Pennsylvania Law to accept such prepayments. Unlike Philadelphia, Delaware, and Allegheny counties, which are governed by Home Rule charters and thus permitted to allow the prepayment of taxes, Montgomery County, as well as Bucks, Chester, and other counties which are not Home Rule, must work within the confines of the tax collection requirements imposed by the Commonwealth. As these requirements explicitly prohibit the prepayment of real estate taxes, Montgomery County is prohibited from accepting 2018 real estate taxes until after the first of the year.

If you pay property taxes in a region where prepayment is permitted, you may only do so if you’ve received your 2018 tax assessment, as this article from Yahoo Finance explains:

But many residents trying to avoid that deduction limit on their state and local taxes will be disappointed: the IRS on Wednesday announced that taxpayers can prepay their 2018 property taxes only if they have already received a tax assessment from their local government and they make payment by the end of the year.

As always, we are here to help. If you have any questions, or would like to discuss your tax plan for 2018, please contact us online or call 215-723-4881.

The Tax Cuts and Jobs Act Has Passed: What You Need to Know

The Tax Cuts & Jobs Act Bill (H.R. 1) has now passed the House and Senate and is on its way to the White House for the President’s signature to become law.

Here is a summary of some of the major provisions that will affect both Individuals and Businesses after this Bill becomes law. Most changes will be effective January 1, 2018; however, there are certain specific changes which will take effect before 2018.

Changes for Individuals

Individual Rates: The top individual rate will be 37 percent for individuals earning $500,000 and above and joint filers earning at least $600,000. There will be seven tax brackets: 10, 12, 22, 24, 32, 35, and 37 percent. The tax bill will nearly double the standard deduction, increasing it to $24,000 for a couple filing jointly and to $12,000 for single taxpayers. The tax rates and standard deduction expansion will expire in 2026.

Mortgage Interest Deduction: The bill will preserve the deduction for existing home mortgages and cap it at $750,000 for newly purchased homes starting January 1, 2018. The plan will also end the deduction for interest on home equity loans.

State and Local Tax Deduction: Taxpayers will be allowed to deduct up to $10,000 of state and local taxes paid, including property taxes and either income taxes or sales taxes.

Child Tax Credit: The child tax credit will be increased to $2,000 from the current $1,000 per child credit, with up to $1,400 of it being refundable.

Medical Expense Deduction: The bill will allow taxpayers to deduct medical expenses exceeding 7.5 percent of adjusted gross income for 2017 and 2018.

Individual Mandate: The plan would zero out the penalties for not obtaining health coverage for individuals and families.

529 College Accounts: 529 Accounts can now be used for elementary, secondary, and higher education.

Individual Alternative Minimum Tax: The individual AMT will increase to apply to individual filers earning more than $500,000 or joint filers earning $1 million or more.

Changes for Businesses

Corporate Rate: The corporate rate will be reduced to 21 percent starting January 1, 2018.

Pass-through Taxation: Pass-through entity owners that meet certain conditions will be eligible for a 20 percent deduction on their business income.

Business Expensing: Full expensing of new and used capital investments will be permitted for five years. After 2022, the 100 percent allowance will be phased down by 20 percent each year. Section 179 expensing, which doubles the amount eligible for the special small business investment write-offs, will also be made permanent.

Corporate Alternative Minimum Tax: The corporate AMT will be repealed.

Other Changes

Estate Tax: The exemption is doubled for estates worth approximately $11 million for individuals and $22 million for couples. The exemptions will revert to current levels after 2025.

International Business: Eliminates incentives that now reward companies for shifting jobs, profits, and manufacturing plants abroad. These incentives will prevent American jobs, headquarters, and research from moving overseas.

For even more information, here is a summary of the policy highlights as provided by the Joint House and Senate Conference Committee for your review.

If you have any questions about how this tax bill will affect your specific tax situation, please contact us online or call 215-723-4881 to set up a time to review the effects of these changes with you.

Disclaimer: This communication contains general tax information and should not be construed as specific tax advice for your situation.