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2019 Individual Tax Returns are due in 9 months and 26 days.

The Sun Sets On QuickBooks 2016

Intuit (the company that makes QuickBooks) announced that support is ending for QuickBooks 2016 on May 31, 2019. This means that many key features of QuickBooks 2016 will stop working. Some examples include Online banking, credit card processing, and payroll processing. The main accounting functions of QuickBooks 2016 will keep working but users will no longer receive technical support or program updates. Here is a link to Intuit with the full explanation regarding its policy:

https://community.intuit.com/articles/1501193-quickbooks-desktop-service-discontinuation-disco-policy-and-upgrade-information

So what are users of QuickBooks 2016 supposed to do now?

This is a great time to look at all options available, including upgrading to QuickBooks 2019. Intuit generally supports QuickBooks on a three-year cycle. This means if you upgrade to QuickBooks 2019, you would not be forced to upgrade until May 2022.

If you are tired of upgrading, one solution might be the QuickBooks Online. This is a web-based version of QuickBooks that is subscription based. Users pay a monthly fee and they are always running the current version of QuickBooks and their data is backed up and can be shared with other users (such as their accountant). There are also other options to consider such as hosted QuickBooks and other web-based solutions.

If you have questions about QuickBooks 2016 and upgrading, please click the [CONTACT ME] tab.

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What is the difference?

Here is a brief video that explains the difference between a tax credit and a tax deduction:

 

Tax Credit vs Deduction

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I have made it past the April 15th filing deadline and had a chance to get some rest. Now I want to share a few of my thoughts about this filing season.

Going into this filing season, I was worried about how the Tax Cut and Jobs Act (passed in late 2017) would impact 2018 tax returns. This was the largest change to the federal tax code since 1986. Form 1040 was radically changed to work with the revised tax code. In addition, Minnesota did not conform to the new law for 2018. 2018 Minnesota returns had to be prepared using the old law – this resulted in more new forms for Minnesota. To prepare for the changes, I attended several continuing education classes. I also prepared a “test client” return for 2018 and 2017 using the same facts so I could compare the returns.

The first few returns took me a little longer than normal. I spent additional time making sure my software was calculating the 2018 returns correctly. Once I was comfortable that things were functioning correctly, the returns ran fairly well. The other big difference for 2018 returns was having to explain the differences between 2018 and 2017 to clients.

Overall, I think the 2018 tax return filing season went fairly well for my practice considering all the changes that went into effect. I am hoping things will settle down for 2019 returns.

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April 15th Survivor!

 

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There are just a few days remaining for you to file your 2018 individual tax return. If you do not think you will have enough time to finish your 2018 return, the IRS will grant you an automatic, six-month extension of time to file your tax return.

Another common reason to file an extension is if you are waiting for 2018 tax documents, such as a K-1 from an S-Corporation or Limited Liability Company, to complete your return.

Caution – an extension is an extension of time to file your return. It is NOT an extension of time to pay your income taxes. If you are going to file an extension, you will need to estimate your 2018 income tax liability as if you would be filing on time. This amount should be paid in on or before April 15, 2019.

An extension is filed by completing Form 4868 on or before April 15, 2019. An extension can be mailed or filed electronically. Many states accept the federal extension as the state extension (my state of Minnesota accepts the federal extension). Some states may require a separate, state extension.

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