by NFS | Dec 22, 2020 | Archives, Blog Posts
The Federal Trade Commission has launched a new website designed to make it easier for victims of potential fraud to file a report with the federal authorities.
The new site, ReportFraud.ftc.gov, prompts those reporting a scam with “next steps” that offer specific guidance based on the nature of the scam.
Romance scams were by far the most costly to older Americans, causing nearly $84 million in financial losses last year. These scams usually begin with a social media contact and eventually lead to a deceitful request for money.
FAQs on the website include:
Report anything you think may be a fraud, scam, or bad business practice. For ideas of what you might report to the FTC, check out consumer.ftc.gov for more information and advice, or take a look at the FTC’s latest cases at ftc.gov.
- I’m not sure if it’s a scam or fraud — should I still report it?
Yes, please report it. Whether you think it’s a scam, you know it is, or you’re not happy about a business practice, tell the FTC. The FTC and its law enforcement partners enforce a variety of laws. Your report makes a difference and can help law enforcers spot problems. Learn more about scams and how the FTC works to stop them at consumer.ftc.gov.
- Can I file a report if I don’t live in the U.S.?
If you live outside the U.S. or want to report an international scam, you can use econsumer.gov to file your report. It will then be included in the FTC’s Consumer Sentinel database. Econsumer.gov is a partnership of more than 35 consumer protection agencies around the world and helps identify trends and prevent international scams. It’s available in English, Spanish, French, German, Korean, Japanese, Polish, and Turkish.
The FTC also collects data related to various aspects of its mission and work and shares that data in different formats and at different levels of frequency. Explore Data links to visualizations, reports, API endpoints, and datasets.
Explore Data lets you dig into consumer data on fraud, identity theft, unwanted calls, and other consumer problems based on reports from the public to the FTC’s Consumer Sentinel Network database and complaints to FTC about unwanted calls. Our interactive dashboards let you spot trends and find out about top reports in your state and around the country. You can also dig into data about refunds the FTC got for people in FTC law enforcement cases, and see where that money went.
by NFS | Dec 21, 2020 | Archives, Blog Posts
There’s never an off-season when it comes to scammers and thieves who want to trick people to scam them out of money, steal their personal information, or talk them into engaging in questionable behavior with their taxes. While scam attempts typically peak during tax season, taxpayers need to remain vigilant all year long.
For example, there are many reports of taxpayers being asked to pay a fake tax bill through the purchase of gift cards. While gift cards are a popular and convenient gift for all occasions, they are also a tool that scammers use to steal money from people.
Scammers often target taxpayers by asking them to pay a fake tax bill with gift cards. They may also use a compromised email account to send emails requesting gift card purchases for friends, family or co-workers. The IRS reminds taxpayers gift cards are for gifts, not for making tax payments.
The most common way scammers request gift cards is over the phone through a government impersonation scam. However, they will also request gift cards by sending a text message, email or through social media.
Here’s a typical scenario:
A scammer posing as an IRS agent will call the taxpayer or leave a voicemail with a callback number informing the taxpayer that they are linked to some criminal activity. For example, the scammer will tell the taxpayer their identity has been stolen and used to open fake bank accounts.
Here’s how the scam unfolds:
- The scammer will threaten or harass the taxpayer by telling them that they must pay a fictitious tax penalty.
- The scammer instructs the taxpayer to buy gift cards from various stores.
- Once the taxpayer buys the gift cards, the scammer will ask the taxpayer to provide the gift card number and PIN.
Scammers are continuously perfecting their tricks and sometimes it is difficult to determine whether it is really the IRS calling. Keep in mind that the IRS will never do the following:
- Call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card or wire transfer. Generally, the IRS will first mail a bill to any taxpayer who owes taxes.
- Demand that taxpayers pay taxes without the opportunity to question or appeal the amount they owe. All taxpayers should be aware of their rights.
- Threaten to bring in local police, immigration officers or other law-enforcement to have the taxpayer arrested for not paying.
- Threaten to revoke the taxpayer’s driver’s license, business licenses, or immigration status.
What to do if you think you’ve been targeted by a scammer
Anyone who believes they’ve been targeted by a scammer should contact the Treasury Inspector General for Tax Administration to report a phone scam. Use their IRS Impersonation Scam Reporting web page or call 800-366-4484.
Phone scams should also be reported to the Federal Trade Commission. Use the FTC Complaint Assistant on FTC.gov and make sure to add “IRS Telephone Scam” in the notes.
Unsolicited email claiming to be from the IRS, or an IRS-related component like the Electronic Federal Tax Payment System, should be reported to the IRS at phishing@irs.gov and be sure to add “IRS Phone Scam” to the subject line.
Remember, gift cards are for gifts, not for making tax payments.
by NFS | Dec 18, 2020 | Archives, Blog Posts
Certain energy-efficient home improvements can cut your energy bills and save you money at tax time. While many of these tax credits expired at the end of 2016, tax credits for residential and non-business energy-efficient solar technologies do not expire until December 31, 2021. Here are some key facts that you should know about these tax credits:
Residential Energy Efficient Property Credit
- This tax credit is 30 percent of the cost of alternative energy equipment installed on or in your home.
- Qualified equipment includes solar hot water heaters and solar electric equipment placed into service on or after January 1, 2006, and on or before December 31, 2021.
- There is no maximum credit for systems placed in service after 2008.
- The tax credit does not apply to solar water-heating property for swimming pools or hot tubs.
- If your credit is more than the tax you owe, you can carry forward the unused portion of this credit to next year’s tax return.
- At least half the energy used to heat the dwelling’s water must be from solar in order for the solar water-heating property expenditures to be eligible.
- Solar water-heating equipment must be certified for performance by the Solar Rating Certification Corporation (SRCC) or a comparable entity endorsed by the government of the state in which the property is installed.
- The home must be in the U.S. It does not have to be your main home.
- Use Form 5695, Residential Energy Credits, to claim the credit.
Equipment costs such as assembling or installing original systems, on-site labor costs, and costs related to wiring or piping solar technology systems are considered final when the installation is complete. For a new home, the placed-in-service date is the occupancy date.
The maximum allowable credit varies by the type of technology:
Solar-electric property
- 30% for systems placed in service by 12/31/2019
- 26% for systems placed in service after 12/31/2019 and before 01/01/2021
- 22% for systems placed in service after 12/31/2020 and before 01/01/2022
Solar water-heating property
- 30% for systems placed in service by 12/31/2019
- 26% for systems placed in service after 12/31/2019 and before 01/01/2021
- 22% for systems placed in service after 12/31/2020 and before 01/01/2022
If you would like more information about this topic please contact the office today.
by NFS | Dec 17, 2020 | Archives, Blog Posts
Congratulations! Your child is headed off to college. The acceptance letters are in—and so are the financial aid packages. Now comes the tough part: How do you know exactly how much each school is going to cost?
It would be great if all higher learning institutions listed their financial aid packages the same way, making an apples-to-apples comparison simple. Unfortunately, they don’t. Here’s a guide on what factors to consider when comparing your various financial aid packages.
Find the estimated cost of attendance. Some schools will make it easy and total up all of the expenses in one place on the offer letter; others may require you to hunt around to gather all of the costs and add them up on your own. Remember, the big ticket expenses are: tuition and fees, room and board, books and supplies (including computer costs), and commuting/transportation. If you know that your child will have additional expenses (such as club memberships or travel needs), add them on.
Break down the assistance offered. You may have three distinct buckets of aid, plus your own and your child’s contributions. Remember, the total aid offered is only for the upcoming school year. Each year could be substantially different, influenced by factors such as your income level, family changes, and financial hardships.
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- Grants and scholarships: These are awards based on merit or need that do not have to be paid back. As you will have to fill out a FAFSA every year, you need to find out if these awards are single year or multi year. Also, be sure to determine which awards are firm and which are estimated.
- Loans: Break these out by Stafford loans (paid by the student) and PLUS loans (paid by the parents). Also be sure to note which Stafford loans are subsidized and which are unsubsidized. The U.S. Department of Education pays the interest on subsidized loans as long as the student remains in school, for the first 6 months after leaving school, and in case of deferments. There is no grace period for unsubsidized loans; repayments start while the student is still in school.
- Work-study programs: Most schools will offer a federal work-study option, which caps earnings at the amount listed. Does your child want to work? Do you think he or she can earn more by bypassing the program and finding a part-time job independently?
Parent/student out-of-pocket payments: This is typically the leftover amount that the school feels you should be able to pay on your own, whether from a college savings plan (such as a 529), through private loans, or from other sources.
Make a spreadsheet that details all costs. Putting the costs in a side-by-side format can help you weigh the pros and cons of each offer. A few things to remember:
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- The cost of college keeps rising. Factor in at least a 2% increase year over year when doing your overall comparison, as the cost of tuition and fees at a 4-year public institution has increased by an average of 2.2% over the past 30 years.
- A four-year education is a thing of the past. Most students take between five and six years to graduate with a bachelor’s degree. Have you saved enough for six years? It’s a good idea to sit down with your child and discuss your finances so they have a clearer understanding of who will pay for what.
Not satisfied? You can appeal. If your child wants to attend a certain college, but the financial assistance offer you received still makes it too expensive for you to consider, contact the school’s financial aid office.
Depending on the college, you may need to write a letter stating your situation or you may be able to make a case directly to a review panel. You will need to provide documentation for any special circumstances you feel will bolster your appeal.
Regardless of your situation, your financial professional can help you budget and save for college.
by NFS | Dec 16, 2020 | Archives, Blog Posts
If you’re thinking of starting a nonprofit organization, there are a few things you should know before you get started. First, is understanding how nonprofits work under state and federal law. For example, two things you should understand is that state law governs nonprofit status. Nonprofit status is determined by an organization’s articles of incorporation or trust documents while federal law governs tax-exempt status (i.e., exemption from federal income tax). Whether you’re starting a charity, a social organization, or an association here are the steps you need to take before you can apply for tax-exempt status.
1. Determine the type of organization.
Before a charitable organization can apply for tax-exempt status, it must determine whether it is a trust, corporation or association. Here is how each one is generally defined:
- A trust is defined as a relationship in which one person holds title to property, subject to an obligation to keep or use the property for the benefit of another. It is formed under state law.
- A corporation is formed under state law by the filing of articles of incorporation with the state. The state must generally date-stamp the articles before they are effective.
- An association is a group of persons banded together for a specific purpose. To qualify under section 501(a) of the Code, the association must have a written document, such as articles of association, showing its creation. At least two persons must sign the document, which must be dated. The definition of an association can vary under state law.
2. Gather organization documents.
Each application for exemption – except Form 1023-EZ – must be accompanied by an exact copy of the organization’s organizing document, which is generally one of the following:
- Articles of incorporation for a corporation
- Articles of organization for a limited liability company
- Articles of association or constitution for an association
- Trust agreement or declaration of trust for a trust
Organizations that do not have an organizing document will not qualify for exempt status. If the organization’s name has been legally changed by an amendment to its organizing documents, they should also attach an exact copy of that amendment to the application. State law generally determines whether an organization is properly created and establishes the requirements for organizing documents.
3. Understand state registration requirements
Next, you will need to take a look at your state’s registration requirements for nonprofits. State government websites have useful information for tax-exempt organizations such as tax information, registration requirements for charities, and information for employers.
4. Obtain Employer ID numbers.
Finally, once your organization is legally formed you will need to obtain employer id numbers (EINs) for your new organization. Organizations can apply for an EIN online, by fax, or by mail using Form SS-4, Application for Employer I.D. Number. International applicants may apply by phone.
Third parties can also receive an EIN on a client’s behalf by completing the Third Party Designee section. Don’t forget to have the client sign the form to avoid having to file a Form 2848, Power of Attorney, or Form 8821, Tax Information Authorization.
One final thing to note, is that nearly all organizations are subject to automatic revocation of their tax-exempt status if they fail to file a required return or notice for three consecutive years. Once an organization applies for an EIN, the IRS presumes the organization is legally formed and the clock starts running on this three-year period.
Questions about starting a nonprofit? Help is just a phone call away.
