To all our valued Above All Accounting clients and friends,

We enjoyed yet another year of working alongside our clients to assist with tax filings, bookkeeping, payroll, and all the projects in between. We are already looking forward to 2024 which will mark the 30th year Above All Accounting has been helping clients with their tax matters. We’re so happy to have the opportunity to provide quality tax and accounting services to our community.

As part of our year-end process, we’ve prepared our annual year-end tax newsletter with information about what to expect from Above All Accounting and new tax law and regulatory changes for the 2023 tax year.

Information to Prepare for Filing 2023 Taxes with Above All Accounting

What’s new?

• We will require a $500 non-refundable prepayment for every entity we are engaged to file taxes for. For example, if you engaged us to file your personal tax returns (e.g., 1040, OR-40, and city tax returns) as well as your business tax returns (e.g., 1065, OR-65, and city tax returns), we would require a $1,000 prepayment prior to beginning any work.
• We have increased our prices as of January 1, 2024 in order to keep pace with inflation and reflect current market prices for the services we provide.
• We will file a precautionary federal extension at drop-off or after an initial tax preparation meeting if all tax documentation is not provided at that time. The extension will be billable unless all tax documentation is provided by the applicable deadline listed below.
• We will be stringent this year with requiring clients to provide documents in the correct format via our secure online portal. We will NOT accept ANY documents or sensitive personal information via email.

What are the deadlines?

S-Corporation and Partnership Filing Deadline: March 15, 2024

• If completed financial statements and/or bookkeeping records for all businesses are not submitted for year-end review and/or reconciliation by January 10, 2024, a federal extension will be filed and we will reserve the right to prepare and file your taxes after the original filing deadline.

C-Corporation and Trust Filing Deadline: April 15, 2024

• If completed financial statements and/or bookkeeping records for all businesses are not submitted for year-end review and/or reconciliation by January 10, 2024, a federal extension will be filed and we will reserve the right to prepare and file your taxes after the original filing deadline.

Individual Filing Deadline: April 15, 2024

• If all tax documents are not submitted for tax preparation by March 10, 2024, a federal extension will be filed and we will reserve the right to prepare and file your taxes after the original filing deadline.

Non-Profit Filing Deadline: May 15, 2024

• If all tax documents are not submitted for tax preparation by April 10, 2024, a federal extension will be filed and we will reserve the right to prepare and file your taxes after the original filing deadline.

Extension fees may apply. If you engage us for tax preparation services, we will file a precautionary federal extension at drop-off or after an initial tax preparation meeting if all tax documentation is not provided at that time. The federal extension is recognized by Oregon, most other states, and many local tax jurisdictions. The extension will be billable unless all tax documentation is provided by the applicable deadline listed above (i.e., January 10, March 10, April 10). $49 for personal extensions and $83 for business extensions. Other fees may apply for specific extensions, but it would be the responsibility of the client to indicate their desire for Above All Accounting to assist in filing such extensions.

How can I give my documents to Above All Accounting?

If you are unable to provide the physical documents to our office in person or via postal service, we provide a secure online web portal for document transfer. Company policy prohibits the transfer of confidential documents using email, Dropbox, or similar methods. Our staff are unable to email documents that contain your social security number, bank account, or any other confidential information. We strongly encourage you to utilize our free secure web portal. If you do not already have an account, we can set one up for you at any time.

How much will this cost?

We are implementing a requirement that all tax preparation clients pay a $500 non-refundable prepayment per entity we are engaged to file for before we begin working on the taxes. The $500 prepayment is our minimum fee for tax preparation and will be applied against your invoice. If any remaining amount is due per the invoice, it will be payable at pick-up after we complete the taxes. If for some reason you do not wish to have us finalize your taxes after we’ve been engaged to do so, the $500 prepayment will not be refunded since it is the minimum amount we require to cover the cost of any tax preparation or administrative work already performed.

The final cost of tax preparation depends primarily on the complexity of your tax return(s). We charge per form to determine cost to prepare your taxes; however, be aware that if you submit documentation that is unorganized or incomplete you may be subject to additional charges billed at the applicable hourly rate for our staff to complete or summarize the information in question.

Please call our office for an estimate only if your tax situation has significantly changed from the prior year.

How can I save money during my tax preparation engagement?

1. Schedule and attend your tax preparation appointment

Tax preparers’ schedules fill up quickly! If you would like to sit down with a tax preparer and discuss your 2023 tax filing, please call as soon as possible after gathering all necessary tax documents and information to reserve your tax appointment. The length of the tax appointment is based upon the complexity of your return as determined by our tax preparers. While we do our best to accommodate all clients, Above All Accounting does NOT guarantee every client will receive a tax appointment. There is a fee of $39 for appointments that are rescheduled or cancelled within 24 hours of the appointment. Should an appointment run beyond the first sixty minutes, the tax preparer’s hourly rate will apply for the remainder of the appointment. This additional time may be added to your final tax preparation invoice at the discretion of your tax preparer.

1. Come prepared for your tax preparation appointment

Enclosed is your tax organizer to assist you in gathering information required for the preparation of your taxes. It is mandatory that you complete the organizer. Please complete the organizer, gather all relevant information, and prepare a list of any questions you may have before your tax appointment. As a returning client, you can request a summary listing all documents that were provided for the previous tax year. Also, remember that if you have a business, you should bring all relevant tax information for the business as well. This should include but is not limited to sales information recorded by city and state taxing jurisdictions, expenses organized by category, Form 1099s received from vendors, and preferably a set of financial statements.

1. Pay your estimated tax payments throughout the year or at the time of extension

Too many taxpayers pay unnecessary interest and penalties to the IRS and state agencies due to late payments. If you typically owe taxes at the time of filing, you should either be paying estimated tax payments quarterly or making an estimated tax payment at the time of extension. Above All Accounting will always provide tax vouchers with your completed taxes if necessary. Be aware that tax extensions only extend your tax filing dates an additional six months; it does NOT extend your time to pay taxes. For clients we plan to file for after the deadline, tax extensions will be based off your previous tax year filing unless you specifically request a calculated payment voucher that considers material changes in your tax situation for 2023 which would be billed at our applicable hourly rate.

How else can we help you?

In addition to tax preparation, we provide the following services throughout the year to give our clients a comprehensive set of services to meet each of their unique needs:

• Bookkeeping and accounting services
• QuickBooks training
• 1099 preparation
• Personal Property Tax Return preparation
• Payroll service
• Notary service
• Corporate/DBA/LLC set-ups
• Tax Consultations/Planning
• Tax Resolution: Our firm has a near perfect success rate for settling tax debt and negotiating offers in compromise (OIC) and abatements. We also prepare delinquent tax return filings to reduce substitute returns prepared by the tax authorities.

Tax Law Changes for 2023 Tax Filings & Beyond

Federal

1. Standard Deduction Increases
   1. For married couples filing jointly, the standard deduction rises to $27,700, up $1,800 from the prior year.
   2. For single taxpayers and married individuals filing separately, the standard deduction rises to $13,850, up $900 from the prior year.
   3. For heads of households, the standard deduction rises to $20,800, up $1,400 from the prior year.
2. Income Tax Bracket Adjustments for Inflation
   1. The 2023 income tax brackets are as follows for single taxpayers and married individuals filing separately:
      1. 12% for incomes over $11,000
      2. 22% for incomes over $44,725
      3. 24% for incomes over $95,375
      4. 32% for incomes over $182,100
      5. 35% for incomes over $231,250
      6. 37% for incomes over $578,125
   2. The 2023 income tax brackets are as follows for married individuals filing jointly:
      1. 12% for incomes over $22,000
      2. 22% for incomes over $89,450
      3. 24% for incomes over $190,750
      4. 32% for incomes over $364,200
      5. 35% for incomes over $462,500
      6. 37% for incomes over $693,750
3. Business Meals Deduction Returns to 50%
   1. For 2023, the business meals deduction has reverted back to its pre-pandemic form, thus the deduction is reduced from 100% to 50% for most business meals. Entertainment expenses are still generally non-deductible.
4. Standard Mileage Deduction Adjustments
   1. Business
      1. 65.5 cents per mile
   2. Medical
      1. 22 cents per mile
   3. Charitable
      1. 14 cents per mile
5. Clean Vehicle Tax Credits
   1. Clean vehicles are plug-in electric vehicles or fuel cell vehicles.
   2. Starting January 1, 2024, consumers can choose to transfer their new clean vehicle credit of up to $7,500 and their used clean vehicle credit of up to $4,000 to a car dealer to effectively lower the vehicle’s purchase price.
   3. New Clean Vehicle Tax Credit
      1. Credit can be worth up to $7,500
      2. General Qualifications
         1. Buy clean vehicle for your own use.
         2. Clean vehicle is placed in service in 2023 or after.
         3. Modified adjusted gross income (AGI) may not exceed:
            1. $300,000 for married couples filing jointly 
            2. $225,000 for heads of households
            3. $150,000 for all other filers
         4. Buy clean vehicle new.
         5. Seller reports required information to you at the time of sale and to the IRS.
         6. Clean vehicle’s manufacturer suggested retail price (MSRP) can’t exceed:
            1. $80,000 for vans, sport utility vehicles and pickup trucks
            2. $55,000 for other vehicles
      3. Specific Vehicle Qualifications
         1. Follow the link below to see if a vehicle is eligible for the new clean vehicle tax credit.
            1. https://fueleconomy.gov/feg/tax2023.shtml
   4. Used Clean Vehicle Tax Credit
      1. Credit can be worth up to $4,000
      2. General Qualifications
         1. Buy used clean vehicle for your own use.
         2. Used clean vehicle is purchased and placed in service in 2023 or after.
         3. Not be claimed as a dependent on another person’s tax return.
         4. Not have claimed another used clean vehicle credit in the 3 years before the purchase date.
         5. Modified adjusted gross income (AGI) may not exceed:
            1. $150,000 for married filing jointly or a surviving spouse
            2. $112,500 for heads of households
            3. $75,000 for all other filers
         6. Seller is a dealer that reports required information to you at the time of sale and to the IRS.
         7. Used clean vehicle has a sale price of $25,000 or less. Sale price includes all dealer-imposed costs or fees not required by law (i.e., taxes, title and registration fees, etc.).
      3. Specific Vehicle Qualifications
         1. Model year is at least 2 years earlier than the calendar year when you buy it. For example, a vehicle purchased in 2023 would need a model year of 2021 or older.
         2. Follow the link below to see if a vehicle is eligible for the used clean vehicle tax credit.
            1. https://fueleconomy.gov/feg/tax2023.shtml
6. Taxpayers may receive Form 1099-K
   1. If you receive payments for good or services through an online app, such as Venmo, Cash App, or PayPal, and those payments add up to more than $600 in the year, you’ll likely get a Form 1099-K.
   2. You should receive your 2023 Form 1099-K before January 31, 2024.
   3. Be aware, payments you receive through an online app from friends and family for gifts or reimbursements for personal expenses are not taxable. We recommend that clients ensure their accounts with these online payment apps are set up correctly to consider business transactions vs personal transactions to avoid reporting issues.

State – Oregon

1. Oregon “Kicker” Credit Returns
   1. The Oregon kicker credit only activates when the state’s revenue exceeds expected revenue by at least 2%, which is assessed every 2 years in line with the state’s budget cycle.
   2. There will be a kicker credit for the 2023 tax year. The credit will equal 44.28% of Oregon taxpayers’ 2022 tax liability before credits. This is the largest in state history!
   3. You can determine the amount of your kicker credit by clicking the “What’s My Kicker?” link on the following webpage (Oregon Revenue Online):
      1. https://revenueonline.dor.oregon.gov/tap/_/#1
2. Pass-through Entity Elective (PTE-E) Tax
   1. In July 2021, Oregon established an elective Pass-Through Entity (PTE) Tax, a business alternative income tax.
   2. For tax years beginning on or after January 1, 2022, entities taxed as S corporations and partnerships may elect annually to be subject to the PTE-E tax at a rate of 9% tax on the first $250,000 of distributive proceeds and 9.9% tax on any amount exceeding $250,000.
   3. Qualifying members of an electing PTE are eligible for a credit equal to 100% of the member’s distributive share of the PTE-E tax paid.
   4. If you qualify, the PTE-E Tax program can provide two primary benefits:
      1. Allows an additional business deduction for PTE-E taxes paid that would otherwise not be considered. The general effect is that taxpayers receive tax savings for paying their state taxes related to their pass-through business income.
      2. Allows taxpayers who itemize to better utilize state & local taxes (SALT) in consideration of the $10,000 SALT cap. The general effect is that taxpayers who would have more than $10,000 SALT reported on Schedule A would receive tax savings from their PTE-E taxes paid (described immediately above) and tax savings from the opportunity to utilize SALT on Schedule A that would otherwise not be considered due to the $10,000 SALT cap.
   5. If you would like to take advantage of this tax provision, we recommend registering with the Oregon Department of Revenue via Oregon Revenue Online. You can find resources to assist with registration on the Oregon Department of Revenue website. See the following link.
      1. https://www.oregon.gov/dor/programs/businesses/pages/pass-through-entity-elective-tax.aspx
3. Oregon Paid Family Leave Insurance Contribution Requirement
   1. Paid Leave Oregon is a new program that allows individuals to take paid time off for many of life’s most important moments that impact our families and our health and safety.
   2. Paid Leave Oregon is paid for by employers and employees. Employers pay 40% and employees pay 60% of the contribution rate, which is 1% for 2023.
   3. Starting January 1, 2023, employees should have seen small deductions from their paychecks for Paid Leave Oregon. It should not have been more than 0.6% of gross wages.
   4. Starting January 1, 2023, employers with 25 or more employees should have also started making contributions to Paid Leave Oregon. Employers with fewer than 25 employees do not need to make contributions, but will still need to collect and submit employees’ Paid Leave Oregon contributions.

General

1. Corporate Transparency Act (CTA)
   1. The CTA was enacted in 2021 and will become effective on January 1, 2024. The CTA will capture more information about the ownership of businesses operating in the United States in order to enhance transparency in entity structures and ownership to combat money laundering, tax fraud, and other illicit activities.
   2. Beneficial Owners include individuals who, directly or indirectly:
      1. Exercises substantial control over a reporting company, or
      2. Owns or controls at least 25% of the ownership interests of a reporting company.
   3. Company Applicants include individuals who directly submitted the registration document for a company, or were primarily responsible for that submission.
   4. Who needs to file?
      1. Non-publicly traded corporations, LLPs, LLCs, or any other entity created by the filing of a document with a secretary of state or any similar office under the law of a state or Indian tribe.
   5. What will be reported?
      1. Company legal name
      2. Current principal place of business street address in the U.S.
      3. Any assumed business name (DBA) used by the company
      4. Taxpayer identification number (TIN or EIN)
      5. Each Beneficial Owner’s name; birthdate; residential street address; and an identifying number with an image of an acceptable ID (e.g., driver’s license or passport).
      6. Each Company Applicant’s name; birthdate; residential street address, (applicants whose business is submitting registration documents may use their business address); and an identifying number with an image of an acceptable ID (e.g., driver’s license or passport).
   6. When do I report?
      1. If your company was created or registered prior to January 1, 2024, you have until January 1, 2025 to report.
      2. Companies created in 2024 must report within 90 days. 
      3. Reports must be updated within 30 days of a change to the beneficial ownership, e.g., through the sale of a business, merger, acquisition, or death, or 30 days upon becoming aware of or having reason to know of inaccurate information previously filed.
   7. How to report?
      1. Reporting companies will report beneficial ownership through FinCEN’s website, not available for reporting until after 1/1/ 2024.
   8. Failure to report is punishable with a civil penalty up to $500/day.

We look forward to assisting you in 2024. Have a great year!

Sincerely,

Your Above All Accounting Team