Thompson Greenspon

Metro DC CPA firm and a trusted name in audit, accounting, tax, and advisory services for businesses

Located within the Washington, DC metropolitan area in Fairfax, VA, Thompson Greenspon has become a trusted name in audit, accounting, tax, and advisory services and providing forward-thinking solutions to help our clients improve their business and achieve their goals.

12/22/2022

Taxpayers can deduct all “ordinary and necessary expenses” paid in carrying on a trade or business. But they must prove that they’re entitled to the deductions claimed. In one case, the U.S. Tax Court ruled a married couple wasn’t entitled to deduct various business expenses for which they offered no valid or insufficient substantiation. For example, on business trips, they didn’t keep records about where meetings were held, or the purpose or the individuals with whom they met. Mileage expenses appeared to be nondeductible commuting expenses. And airfare, meals and lodging expenses were found to be partially for personal purposes and weren’t supported by credible records. (TC Memo 2022-113)

12/22/2022

Spouses who file joint federal tax returns are both generally liable for the tax owed. But joint filers may be eligible for innocent spouse relief. In one case, the U.S. Tax Court ruled that a wife wasn’t entitled to relief from tax liability with her husband. She didn’t prove that she was unaware of tax understatements from an embezzlement scheme her husband was involved in when she signed several tax returns. She reviewed the returns and had access to accounts in which the embezzlement proceeds were deposited. Although she was primarily a homemaker, she was an attorney, and the court noted her legal training would have “alerted her to a likely understatement.” (TC Memo 2022-115)

12/21/2022

It’s holiday time, but not everyone is sharing goodwill. Thieves are hoping to catch people off guard and a favorite target is senior citizens. Next month, the 2023 cost-of-living adjustment (COLA) rolls out automatically to Social Security (SS) recipients. But thieves have been using phone calls, texts and email to contact seniors, impersonating government agents. These scammers tell SS recipients that, to get the COLA they must first verify personal information, which then may be used to steal assets. As always, the government won’t contact you by phone to ask for personal information. If you receive a suspicious call or contact don’t take the bait. To report a scam: https://hubs.la/Q01wn0z20

12/21/2022

A new law aimed at bolstering retirement saving is closer to becoming reality after two years of fine tuning. The Securing a Strong Retirement Act of 2022 (Secure Act 2.0) is part of the omnibus spending bill that Congress is taking up before year end. This version was approved last spring by the U.S. House of Representatives. Among the many proposed changes are a new tax credit for some small employers of military spouses, a 50% saver’s credit and an increased small employer startup credit. Given the current economic hardship factors that impact taxpayers’ ability to financially plan, observers in the retirement industry see strong bipartisan support for the bill’s passage. Stay tuned!

Answers to your questions about taking withdrawals from IRAs - Thompson Greenspon CPA 12/20/2022

Answers to your questions about taking withdrawals from IRAs - Thompson Greenspon CPA

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You may spend decades building up your traditional IRA but there comes a time when you must start taking withdrawals. Here are answers to frequently asked questions about required minimum distributions.

Answers to your questions about taking withdrawals from IRAs - Thompson Greenspon CPA As you may know, you can’t keep funds in your traditional IRA indefinitely. You must start taking withdrawals from a traditional IRA (including a SIMPLE IRA or SEP IRA) when you reach age 72. You must take your first RMD by April 1 of the year following the year in which you turn 72, regardless of...

12/20/2022

The White House has released a comprehensive guidebook to the Inflation Reduction Act’s clean energy and tax incentives. It provides an overview of related programs and explains who’s eligible to apply for funding and for what activities. For example, several provisions encourage businesses to invest in communities most in need of new economic development. Consumer incentives include the Clean Vehicle Credit, the Previously Owned Clean Vehicles Credit and the Energy Efficiency Home Improvement Credit. The latter provides up to $3,200 annually in tax breaks to lower the cost of energy efficient upgrades. For details on these and other incentives: https://hubs.la/Q01whtkn0

12/16/2022

If you’re a business owner hoping to deduct asset depreciation from your gross income, it’s crucial to track the percentage of business use of assets. In one case, a married couple were long-time farmers. They deducted large amounts of depreciation on farm equipment and vehicles over several years, but they failed to track the business use of the assets. Based on inadequate records, the IRS disallowed most of the deductions. Fortunately, the U.S. Tax Court found a reasonable basis for redetermining proper depreciation, allowing higher depreciation of some assets. However, others were disallowed. Keeping good records from the start may allow you to avoid a lengthy battle. (TC Memo 2022-117)

12/15/2022

If you own a business or are self employed and you deferred part of your Social Security tax in 2020, the second installment of the deferred amount is due Dec. 31, 2022. To pay, you can use the Electronic Federal Tax Payment System (https://hubs.la/Q01vZmxt0). On the “type of tax” screen, choose “Deferred Social Security Tax” and then change the tax period to the 2020 calendar quarter for which the tax was deferred. Or use IRS Direct Pay (https://hubs.la/Q01vZsjn0), selecting “Pay Now With Direct Pay,” and then “Balance Due” for the 2020 tax year. Use the same address to pay with a credit or debit card or digital wallet. The IRS doesn’t charge a payment fee but a third-party processor does.

12/14/2022

The IRS is reminding those who were born in 1950 or earlier that they must soon begin taking required minimum distribution (RMDs) from their IRAs or other retirement plan accounts. Generally, RMDs are the minimum amounts that IRA and retirement plan account owners age 72 and older must annually withdraw from their accounts. Depending on the type of retirement account you have, you can delay taking your first RMD until April 1 of the year following the year you turn 72 or, in certain workplace retirement plans, the year you retire. RMDs are taxable income and you’re generally subject to penalties if you don’t take your RMDs on time. For more information: https://hubs.la/Q01vSxkd0

12/13/2022

Thompson Greenspon was happy to donate to as part of our annual holiday tradition of giving back to the community! Help bring a smile to those less fortunate by learning how you can donate at https://hubs.la/Q01vMLVd0

12/13/2022

Did you or someone you know get married in 2022? The IRS has provided a checklist to help newlyweds avoid mistakes that could cost them at tax time. How you file depends on your marital status on Dec. 31. The married-filing-jointly status is typically the most beneficial way for couples to file, but it’s a good idea to take a what-if look at filing separately. Did your name change? To avoid delays, report changes to the Social Security Administration and if you have a new address, inform the IRS and the U.S. Postal Service. Also, within 10 days of getting married, provide your employers with new Forms W-4 (Employee’s Withholding Allowance). For more details: https://hubs.la/Q01vMhCQ0

12/13/2022

Should tax-exempt universities be allowed to pay athletic coaches multi-million-dollar salaries? That was the focus of an investigation led by Rep. Bill Pascrell (D-NJ), chair of the U.S. House Ways and Means Oversight Committee. With input from nine schools, a report was issued on Dec.1, 2022, in which Pascrell casts doubt on whether these salaries align with the educational missions as tax-exempt entities. In a press release, he stated, “Americans should care deeply about these excessive salaries that our federal tax code is helping to fund,” adding that the schools may not be acting in the best interests of the students or the taxpayers. To read the press release: https://hubs.la/Q01vM94l0

12/12/2022

The IRS is warning businesses that they’re prime targets for identity theft. How do you know if your company’s identity has been stolen? According to the IRS, you should investigate if you receive a: 1) rejection notice for an electronically filed tax return because a return is already on file, 2) notice about a return you didn’t file, 3) notice about Forms W-2 filed with the Social Security Administration that you didn’t file, or 4) notice of a balance due that you don’t owe. If you think your business is a victim of tax identity theft, contact us to file Form 14039-B. However, the IRS is likely to spot a scam before you do and notify you via letter with instructions on how to proceed.

12/12/2022

It’s been said that a little preparation can go a long way. This certainly applies toward taxes, specifically, the upcoming 2023 tax filing season. As year-end nears, it’s a good time to round up your 2022 tax records. The IRS says that taxpayers who have all their tax documentation gathered and organized are in the best position to file accurate tax returns and avoid processing or refund delays. The IRS notes that the tax records you retain should include copies of filed tax returns for at least the last three tax years and all supporting documents for those returns.

12/09/2022

Business owners can generally deduct their business-related vehicle expenses, but they bear the burden of proving they’re entitled to the deduction. Taxpayers must keep detailed contemporaneous records of each trip (the date, time, miles driven and business purpose), even if the standard mileage rate is claimed. In one U.S. Tax Court case, a married couple claimed $13,596 in car and truck expenses, supported only by mileage logs that weren’t kept contemporaneously. The court disallowed the entire deduction, stating that “subsequently prepared mileage records don’t have the same high degree of credibility as those made at or near the time the vehicle was used.” (TC Memo 2022-113)

12/05/2022

It’s a timely message for the giving season: Beware of fake charities. The Security Summit, a partnership between government agencies and tax professionals, is warning about criminals who set up fraudulent charities to steal “donations” and personal information. The Summit offers several tips for charitable donors, including 1) be suspicious if a so-called charity uses pressure to get you to make an immediate payment, 2) never donate to a charity that requests payment via gift card or by wiring money, and 3) don’t provide any more personal information (such as credit card and Social Security numbers) than is necessary for the transaction. Also, always ask for charities’ tax ID numbers.

12/05/2022

Kudos to our very own tax partner, Carolyn Quill, on being the editor for the Tax Clinic articles in this month’s issue of AICPA's publication, The Tax Adviser! Check out the December issue here: https://hubs.la/Q01t_dd30

How inflation will affect your 2022 and 2023 tax bills - Thompson Greenspon CPA 12/02/2022

How inflation will affect your 2022 and 2023 tax bills - Thompson Greenspon CPA

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Many people are feeling the squeeze of inflation. What does this mean for your federal tax bill? Here’s what the inflation-adjusted amounts will be for several provisions in 2023, as compared with 2022.

How inflation will affect your 2022 and 2023 tax bills - Thompson Greenspon CPA The IRS recently announced next year’s inflation-adjusted tax amounts. For 2023, the standard deduction will increase to $13,850 for single taxpayers, $27,700 for married couples filing jointly and $20,800 for heads of household. This is up from the 2022 amounts of $12,950 for singles, $25,900 for...

12/01/2022

In the wake of cryptocurrency exchange FTX’s bankruptcy filing, Senate Finance Committee Chair Ron Wyden (D-OR) is seeking answers on what safeguards are in place to protect retail investors in the event of bankruptcy or theft. Wyden recently sent letters to crypto trading platforms Binance, Bitfinex, Coinbase, Gemini, Kraken and KuCoin. Wyden asked the exchanges to provide information regarding internal security controls, balance sheet health and suspicious activity monitoring. He also sought clarity on how the companies “address any potential financial irregularities, tax compliance issues, or money laundering concerns identified by internal or external auditors.”

11/30/2022

The holiday season is in full swing, and so are scams, warns the IRS. Con artists target taxpayers, possibly posing as IRS agents trying to collect bogus tax bills. They often demand payment by gift cards. Scammers may also claim a taxpayer’s identity has been stolen and used for criminal activity. These scams are usually attempted by phone, warns the IRS, but also by text, email or social media. How can you spot a scam call? IRS agents will never require you to use a specific payment method such as a gift card. They won’t threaten to send local police to arrest you for nonpayment or threaten to revoke a driver’s license or other license. For more tips from the IRS: https://hubs.ly/Q01tG22N0

11/29/2022

The federal government will soon be increasing its regulation of cryptocurrency. Starting in January 2023, crypto brokers must observe new tax reporting requirements. These include providing investors with IRS Form 1099-B, which documents crypto profits and losses. Buying crypto generally isn’t taxable. However, trading it, converting it to cash and using it for purchases, may be. Regardless of the specific activity, investors must disclose any crypto ownership by checking a box on their tax returns. The new regulations are expected to yield $28 billion in new taxes over a decade and close several loopholes. More regulations from the IRS and SEC may be forthcoming.

11/28/2022

Spouses who file joint federal tax returns are both generally liable for the tax owed. But joint filers may seek “innocent spouse” relief. In one case, a man received innocent spouse relief regarding taxable proceeds that his ex-wife received in settlement of an employment discrimination lawsuit. Although he had knowledge of the settlement proceeds, he credibly testified that he made a good faith effort to comply with the law but erroneously believed a portion of the settlement wasn’t taxable. Plus, he was in poor health and showed he would suffer economic hardship if he was held liable because his only income was Social Security disability payments. (TC Memo 2022-110)

11/21/2022

If you’re age 70½ or older and have an IRA, qualified charitable distributions (QCDs) are an option for making tax-free gifts to charity of up to $100,000. Moreover, if you’re at least age 72, QCDs count toward your required minimum distribution for the year. Note that if you wish to make a QCD for 2022, you should contact your IRA trustee soon so he or she will have time to complete the transaction before year end. Normally, distributions from a traditional IRA are taxable when received. With a QCD, however, distributions are tax-free as long as they’re paid directly from the IRA to an eligible charitable organization.

11/21/2022

Investors with inaccessible assets tied up in cryptocurrency exchange FTX Trading Ltd. will need to wait until court proceedings conclude before learning if loss deductions will be available. FTX filed for bankruptcy in early November. Legible, a cryptocurrency tax and accounting platform, has stated that consumers are likely to incur deductible losses but not soon. Instead, because FTX filed Chapter 11 bankruptcy, Legible explained these losses will likely not be recognizable on tax returns until (at least) 2023 once fully ruled on in court. U.S. Treasury Secretary Janet Yellen said that FTX’s downfall “demonstrates the need for more effective oversight of cryptocurrency markets.”

11/18/2022

Is the IRS holding you responsible for a debt that your spouse or ex-spouse owes? If you file jointly, the IRS may offset the debt using a refund that YOU have coming. Or the agency may file a federal tax lien or levy to collect the debt from you. The IRS Tax Advisor Service (TAS) states that if you aren’t legally responsible for the entire debt, there may be remedies. You can file an “injured spouse” claim if you filed a joint tax return and all or part of your refund is taken to pay a debt your spouse owes. Or you can seek “innocent spouse” relief if your spouse or ex-spouse improperly reported or omitted items on your tax return. Here’s more: https://hubs.la/Q01sHY4p0. Contact us with questions.

Partnering With You for Your Success

Your success is our goal. At Thompson Greenspon we offer award-winning service and pro-active solutions, customized to meet your specific tax, audit, accounting and consulting needs.

Personal relationships are important to us. Since our founding in 1956, the firm has advanced the goal of having you work with the same dedicated team members year after year. As one of the largest CPA firms in the DC metro area, we deliver industry-leading expertise that is competitive with national and regional firms.

Telephone

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4035 Ridge Top Road Ste 700
Fairfax, VA
22030

Opening Hours

Monday 8:30am - 5pm
Tuesday 8:30am - 5pm
Wednesday 8:30am - 5pm
Thursday 8:30am - 5pm
Friday 8:30am - 5pm

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