The professionals at Anderson Davis have collected some of the most useful tax-related resources from around the web: tax and financial calculators, retirement planning tools, tax code updates and websites devoted to tax issues. Click on the list below to select the resource that you are interested in.
Loan, Investment, Rate-Yield, 401(k), Retirement & Annuitization Calculators
Investment, Finance and Planning Calculators
Mortages, Bank Rates, Credit Cards and Insurance Calculators
- www.irs.gov – Your place for all things tax.
- www.marylandtaxes.com – Useful website for all your Maryland tax issues.
- www.business.gov – The official business link to the US Government.
- www.businessweek.com – Coverage on the latest events in the business world.
- www.inc.com – How-to guides and events for entrepreneurs / small businesses.
- smallbusiness.com – Guidance on business decisions for the small business.
- 360financialliteracy.org – Guidance for financial planning during various stages of life.
- Difference Between Compilation, Review and an Audit – A helpful brocure differentiating between these three levels of assurance services.
Record Keeping Tips
Tax records should be kept year-round, not hastily assembled just for your annual tax appointment. But which records are important, and how and why do you keep them?
Without tax records, you can lose valuable deductions by forgetting to list expenses on your return or having unsubstantiated items disallowed if you’re audited.
Generally, returns can be audited up to three years after filing. However, if income is under reported by more than 25%, the Internal Revenue Service can collect underpaid taxes up to six years later. In other words, you need good records to verify what you report on your tax returns.
Another money-saver: If your records are organized, your accountant will need less time to review your records. This may translate to lower tax preparation fees.
Which Records Are Important?
- Records of income received
- Expense items, especially work-related expenses
- Home improvements, sales, and refinances
- Investment purchases and sales information
- The tax basis of gifted and inherited property
- Specific uses of loan proceeds
- Medical expenses
- Charitable contributions
- Interest and taxes paid
- Records on nondeductible IRA contributions
How should you keep your tax records? Any way that is convenient for you that will allow you to give complete information on each item: how much? what for? when? where? why?
Record Keeping For Business
The tax law requires all businesses to keep records to support the gross income, deductions, and credits claimed on their income tax returns.
What records? All businesses should have a permanent set of books which summarize individual deposits, disbursements, and items of adjustment. These records should be retained indefinitely.
Permanent records also include those needed to prove the basis (cost) of depreciable assets.
Supporting documents may be needed to validate the journal entries if your returns are examined by the IRS. The general rule is that supporting documents should be retained at least until the statute of limitations for a tax year has passed.
The supporting documents the IRS reviews include bank statements, cancelled or substitute checks, payroll records, invoices, and the like. You should also retain documents supporting deposits which do not reflect income, such as loan documents.
What happens if your records are inadequate? If you fail to retain adequate records to support the items claimed on your returns, the IRS has authority to reconstruct your income using one of several methods, including estimating increased net worth, looking at bank records, or estimating the raw materials used in manufacture.
Whatever method the IRS uses, you have the burden of proof if you dispute their estimate. Without adequate records, proving the IRS estimates wrong is difficult, at best. You could end up with an assessment for additional taxes, plus penalties and interest.
How Long Should Records Be Kept?
Just how long you should keep records is partly a matter of judgment and a combination of state and federal statutes of limitations. Federal returns can be audited for up to three years after filing (six years if under-reported income is involved), so all records substantiating tax deductions should be kept at least that long.
Here are recommended retention periods for various records:
- Cancelled or substitute checks 7 years
- Credit card receipts 7 years
- Paid invoices 7 years
- Bank deposit slips 7 years
- Bank statements 7 years
- Tax returns (generally) 7 year
- Employment tax returns 7 years
- Expense records 7 years
- Financial statements Permanent
- Contracts Permanent
- Minutes of meetings Life of company plus 7 years
- Corporate stock records Permanent
- Employee records Period of employment plus 7 years
- Depreciation schedules Life of assets plus 7 years
- Real estate records Ownership period plus 7 years
- Journal & general ledger Life of business plus 7 years
- Inventory records 7 years
- Investment records Ownership period plus 7 years
- Home purchase and improvement records Ownership period plus 7 years
Requirements for computer-maintained records are generally the same as for manually kept records.
- Tax and governance information for Non-profits
- Helping Nonprofits Make Smart Software Decisions
- Collection of latest headlines related to Non-profit organizations
- Annual Electronic Filing Requirement for Small Exempt Organizations- Form 990-N
- Tips for Keeping Exempt Status
- Donor-Advised Funds: Preparing for Closer Scrutiny
- Going for Consensus, Not Robert’s Rules
- Maryland’s Homestead Tax Credit Process
- Uniform Prudent Management of Institutional Funds Act
- IRS Changes Requirements on Reporting Nonprofit Executive Compensation
- Board Review of Form 990
- Reporting Compensation on the New Form 990
- Form 990 Resources and Tools
- Public Disclosure Requirements for Nonprofits
- Operating Reserves for Non-Profit Organizations White Paper
- Non-Profit Operating Reserves Policy Toolkit
- Understanding Audits, Reviews and Compilations for Non-Profit Organizations