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A Look Into the Deep, Dark Web

As we continue on with the IRS Tax Security Awareness Week, today we are going to provide an overview of what the Dark Web is and how it is being used. The Dark Web is where the majority of personal information is being obtained, purchased, and sold. The internet has three “types” of websites known as the Surface Web, Deep Web, and Dark Web. Each type is described below.

Surface Web: Is the place that most people are used to and go majority of the time when on the internet. This is accessible via normal browsers that you’re used to such as Explorer, Firefox, and Chrome. And they’re the normal websites we all go to such as Google, Yahoo, and Facebook, to name a few. It’s been part of the worldwide web since the first browser was introduced in 1990 and it’s the thing most people are familiar with. Anything you can discover through your Internet browser using any of the main search engines is what you get access to. This is where you read about the news, buy something on Amazon, or visit any of your daily sites. It’s also an area of the web that’s under constant surveillance by governments across the world.

Deep Web: These are private databases that require a specific password, encrypted browser, or a set of log-in details. Examples of website on the Deep Web is online banking, employers that have HR sites available to employees, medical facilities that now enable patients to access their information online. Therefore, all of our medical records, financial records, social media files, and plenty of other information we want to and need to keep secure is housed on the Deep Web. A good example is when you have to either generate a PIN number or have memorable information to enter across bank accounts often online. This information is stored in the Deep Web, and you have to use details like passwords and those kinds of things to allow you special access.

Dark Web: This is part of the Deep Web. But its major difference is that it has been intentionally hidden, anonymous, and is inaccessible to normal web browsers. The Dark web is only accessible via special software. The technology to create the Dark Web was initially created and is still funded by the U.S. military researchers since the mid-1990s. And the reason was, to allow spies and intelligence agencies to anonymously send and receive messages. However, you can’t hide messages if there’s nothing to hide them behind. Therefore, if more people have access to send anonymous messages, it’s harder to find — for counterintelligence agencies to discover these messages. So the government opened up the Dark Web to allow others to use it so they could send messages back and forth that they didn’t want governments or other people to know.

As a result of users now being able to access the internet anonymously, criminals and those performing illegal acts have also begun using the Dark Web. In essence, in the age of technology, the Dark Web has become the next “street corner” for illegal acts and as we will focus on cyber-thieves obtaining access to our personal information such as Name, Address, Social Security Number, Credit Card Numbers, Bank Accounts, and the many other data breaches that have become a common occurrence.

Remember the old phrase of “dumpster diving”? This is essentially now being done virtually online. At one point in time, thieves would go through dumpsters of business and people looking for trash that wasn’t shredded and contained personal information. Or the thieves would physically break-in to businesses to steal information, computers, etc. Now, this can and is being done all online in the Dark Web.

Now that we know about the Dark Web, when online, we should always be aware that there are cyber-thieves everywhere just waiting for us to slip up and provide personal information on a website that we think is safe. Therefore, we should take extra measures to protect our personal information. Some of the recommended actions are:

  1. Protect your computer by always having security software and firewall installed.
  2. Encrypt files that are stored on your computer. This is generally done by requiring a password in order to open the files.
  3. We recommend using a password that is a minimum of 12 characters.
  4. When on a website, always make sure in the URL, the “http” includes an “s”, so it should be “https”. The “s” identities the website as secure.
  5. Learn to recognize and avoid scams. As we noted yesterday, the most common method for cyber-thieves to obtain your personal information is simply by asking for it and this is happening through email.

A good tip is to treat all your personal information like we treat cash. So just as we take steps to protect our cash and not leave it laying out for anyone to take, we should use these same actions to protect our personal information.

A complete IRS webinar discussing the Dark Web is available at https://www.irsvideos.gov/Webinars/UnderstandingBasicsDarkWeb

Additional information can be found on the IRS website at https://www.irs.gov/newsroom/national-tax-security-awareness-week-2018

 

Tax Security Awareness Week at the IRS – Dec. 3 – 7, 2018

With the holiday shopping season in full swing, the Internal Revenue Service and Security Summit partners warn taxpayers to take extra steps to protect their tax and financial data from identity thieves.

The holidays offer cybercriminals a chance to steal financial account information, Social Security numbers, credit card information and other sensitive data to help them file a fraudulent tax return in 2019.

“With tax season quickly approaching, people should be extra careful during the holidays to protect their sensitive tax and financial data,” said IRS Commissioner Chuck Rettig. “Taking a few simple steps can protect this valuable information and help prevent someone from stealing a tax refund. Taxpayers guarding their information also helps strengthen protections against identity thieves taken by the IRS, the states and the tax industry.”

Did you know? The most common method for cyber-thieves to get personal information is simply just by asking for it through email. We recommend NEVER providing personal information via email.

Below are seven steps to help with online safety and protecting your personal information:

  • Avoid unprotected Wi-Fi. Unprotected public Wi-Fi hotspots in malls or at holiday events also may allow thieves to view transactions. Do not engage in online financial transactions if using unprotected public Wi-Fi.
  • Shop at familiar online retailers. Generally, sites using the “s” designation in “https” at the start of the URL are secure. Look for the “lock” icon in the browser’s URL bar. But remember, even bad actors may obtain a security certificate so the “s” may not vouch for the site’s legitimacy. Beware of purchases at unfamiliar sites or clicks on links from pop-up ads.
  • Learn to recognize and avoid phishing emails that pose as a trusted source such as those from financial institutions or the IRS. The IRS has seen an increase in these schemes this year. These emails may suggest a password is expiring or an account update is needed. The criminal’s goal is to entice users to open a link or attachment. The link may take users to a fake website that will steal usernames and passwords. An attachment may download malware that tracks keystrokes — putting personal information at risk.
  • Keep a clean machine. This applies to all devices – computers, phones and tablets. Use security software to protect against malware that may steal data and viruses that may damage files. Set it to update automatically so that it always has the latest security defenses. Make sure firewalls and browser defenses are always active. Avoid “free” security scans or pop-up advertisements for security software.
  • Use passwords that are strong, long and unique. Experts suggest a minimum of 10 characters but longer is better. Avoid using a specific word; longer phrases are better. Use a combination of letters, numbers and special characters. Use a different password for each account. Use a password manager, if necessary.
  • Use multi-factor authentication. Some financial institutions, email providers and social media sites allow users to set accounts for multi-factor authentication. This means users may need a security code, usually sent as a text to a mobile phone, in addition to usernames and passwords.
  • Encrypt and password-protect sensitive data. If keeping financial records, tax returns or any personally identifiable information on computers, this data should be encrypted and protected by a strong password. Also, back-up important data to an external source such as an external hard drive. And, when disposing of computers, mobile phones or tablets, make sure to wipe the hard drive of all information before trashing.

Remember – While you are Holiday gift shopping online, cyber-thieves are also shopping online for your personal information!

Tomorrow’s Blog – The Dark Web

Did you know the Tues after Thanksgiving is called “Giving Tuesday”?

Yes, this day is an annual event celebrated the week after Thanksgiving to kick off the season of charitable giving.

We are proud to help our Fox Valley Community through donating to the following:

Neenah Animal Shelter   – https://www.facebook.com/events/240207573340239/

Unforgettable Underdogs  – https://www.facebook.com/donate/328094054446020/

Saving Paws Animal Rescue – https://www.facebook.com/donate/2130272100567430/10155448896016377/

Yes, the donations you gave on “Giving Tuesday” may be deductible on your tax return.

You can check the status of an organization on the IRS website at Exempt Organizations Select Check. Scroll down to the blue box that says” Exempt Organizations Select Check Tool”. Follow the online instructions.

A valid charitable contribution may be disallowed by the IRS if not adequately substantiated. Therefore we suggest retaining a copy of the canceled check, bank statement with check clearing, and letter from the charitable organization.

Gifts: Gifts made directly to needy individuals do not qualify for a charitable deduction; a charitable organization must be involved and the gifts cannot be earmarked for the benefit of a specified person. Consequently, donations to a fund set up to help a person or family cope with large medical bills or casualty losses are not deductible as charitable contributions.

Services: Charitable deduction is not allowed for contribution of services. However, any out-of-pocket unreimbursed expenses incurred while contributing your services is usually tax deductible.

As always, Thank you for reading my blog!

Tina

Community Events in Appleton this week. Enjoy!

As we celebrate Thanksgiving and the official start to the Christmas Holiday Season, we have listed some upcoming events this week.

Tuesday: Appleton Christmas Parade! The largest nighttime parade in the Midwest with approximately 80,000 people attending! The Parade will begin at 7:00 p.m. at the corner of State St. and College Ave. It will head east on College Ave. to Drew St. To see the route of the parade, click here http://applications.appleton.org/parades/christmas%202017/route.html.

Before the Parade – Santa Scamper Run! Race Start: 6:40 p.m. at corner of State Street & College Avenue. The .08-mile run starts about 1/2 hour prior to the 48th Annual Downtown Appleton Christmas Parade and proceeds down College to Drew St., finishing at City Park.

Course Notes: Due to Jones Park being shut down because of construction of the Fox Cities Exhibition Center, the event will now finish at City Park. Please keep this in mind when choosing where to park for the event. Due to the Jones park construction, the 2018 event will be 0.8 miles long. Good-Luck to all the Runners!

 

Thursday: Turkey Trot & Happy Thanksgiving! This year’s Appleton Turkey Trot starts at 8am with a 5-mile run, 2-mile walk, and dog jog.  The trot starts at the Radisson Paper Valley Hotel downtown Appleton.  After, the turkey trot, we wish everybody a fun-filled day with family and friends!

 

If you are one of the estimated 54 million traveling for the Holiday ~ Very Safe Travels!

 

Saturday: Small Business Saturday ® ~ A day to celebrate and support small businesses and all they do for the community. Bring your Shop Appleton First passport with you on Small Business Saturday on Nov. 24 to the 56 Downtown businesses and get it stamped. Passports will be available in the shops (WSL), to download on line, and in the Thanksgiving Day edition of the Post Crescent. Get 5 stamps and be entered to win over $2000 in prizes.

For a list of all the participating small businesses, click here https://appletondowntown.org/wp-content/uploads/2018/11/2018-Small-Business-Saturday-Passport-Offers.pdf

Thank you for reading our blog!  Have a Very Happy Thanksgiving Holiday!!

 

 

Don’t Forget Your RMD’s!

Before all the excitement, chaos, and family drama of the Holiday Season gets underway, be sure to double check your finances and if you are age 70 ½ years-old or more, Congratulations! You’ve hit a big milestone in your life. Although this one, may be unexpected if you didn’t prepare. Either way, the IRS will love you just the same.

We’ve put together some answers to frequently asked questions regarding Required Minimum Distributions, also known as RMD’s.

Question 1: What is an RMD?

Answer 1: After reaching age 70 ½ years-old, the IRS requires you to take distributions from your retirement accounts and IRA’s.

Question 2: Does this include Roth IRA’s?

Answer 2: No, a Roth IRA is not required to be drawn until the death of the owner of the account.

Question 3: When do I turn 70 ½?

Answer 3: Normally April 1 of the year following the later of the calendar year you either (1) reach age 70 ½ or (2) retire.

Question 4: What date do I need to take the distribution by?

Answer 4: In the year that you turn 70 ½ years-old, you have until April 1 of the following year to take your first RMD. After that, you need to take your RMD by December 31 each year.

Question 5: What if I do not take an RMD once reaching age 70 1/2

Answer 5: You may be subject to a penalty of up to 50% of the excess RMD over the actual amount distributed during a tax year.

Question 6: What if I just simply forgot to take an RMD by December 31? Can I take 2 RMD’s in the next year?

Answer 6: No, you can’t make up for a missed RMD from one year in the next year by taking two RMD’s. Rather, the IRS has the authority to waive the 50% penalty provided that you can establish the gap between the RMD and the amount actually distributed was due to reasonable error and steps are being taken to correct the missed RMD amount.

Question 7: How do I request the IRS waive the 50% penalty?

Answer 7: Complete Form 5322 and attach a statement of explanation.

An excellent article we like is “9 Things You Need To Know About Required Minimum Distributions (RMDs)” at https://www.retirementliving.com/all-about-required-minimum-distributions.

Additional information is available on the IRS website at this link https://www.irs.gov/retirement-plans/retirement-plans-faqs-regarding-required-minimum-distributions#1.

As always, Thank you for ready my blog,

Tina

 

We Moved ~ New Sign is Up!

We outgrew our office space! Yes, if you have been by our office recently, you’d have to agree – space was a premium!

We have moved to a larger office space (not too far away) down the road on W. College Ave to S. Casaloma Drive (across from Office Max). Our new address is 213 S. Casaloma Drive.

To celebrate our larger office space, we are hosting & would love for everyone to come to one (or both) of our open houses!

Open House Dates:

Wednesday, Nov. 7 @ 4-6pm

Saturday, Nov. 10 @ 11am – 1pm

We will have plenty of fun, food, drinks, and drawings for raffle items!

We look forward to seeing you at our open houses!

Thank you for reading my blog,

Tina

 

 

 

Tax reform brings changes to real estate rehabilitation tax credit

Rehabilitation Tax Credit:

The rehabilitation tax credit offers an incentive for owners to renovate and restore old or historic buildings. Tax reform legislation passed in December 2017 changed when the credit is claimed and provides a transition rule:

  • The credit is 20 percent of the taxpayer’s qualifying costs for rehabilitating a building.
  • The credit doesn’t apply to the money spent on buying the structure.
  • The legislation now requires taxpayers take the 20 percent credit spread out over five years beginning in the year they placed the building into service.
  • The law eliminates the 10 percent rehabilitation credit for pre-1936 buildings.
  • A transition rule provides relief to owners of either a certified historic structure or a pre-1936 building by allowing owners to use the prior law if the project meets these conditions:
    • The taxpayer owned or leased the building on January 1, 2018, and the taxpayer continues to own or lease the building after that date.
    • The 24- or 60-month period selected by the taxpayer for the substantial rehabilitation test begins by June 20, 2018.

For additional information, please contact our office at info@integrityintaxllc.com or 920-277-2991.

 

Monthly Newsletter:

Don’t forget to sign up for our monthly newsletter written specifically for Real Estate Professionals by emailing info@integrityintaxllc.com to request a monthly email.

 

 

New Location:

Our office is moving this week to 213 S. Casaloma Drive, Appleton ~ it is just down the street on W. College Ave across from Office Max.

Final Notice: Tax Extensions Coming Due

2017 Tax Extensions are coming Due!

  • Business Returns Due September 17, 2018
  • Individual Returns Due October 15, 2018

Note:  In order for tax returns to be complete by the due dates above, information must be received by our office no later than these dates:

  • Business Returns – September 7, 2018
  • Individual Returns – October 5, 2018

Please email or call Tina at 920-277-2991 to schedule an appointment for your 2017 tax return.

This is Final Notice of Tax Extension Due Dates from our Office.  Please plan accordingly.  Thank you!

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Real Estate Professionals: Like-Kind Exchanges & Rehabilitation Credit

1031 Like-Kind Exchanges Applies to Only Real Property:

Like-kind exchanges are the exchange of real property used for business or held as an investment solely for other business or investment property that is the same type or “like-kind”. This has long been permitted under the Internal Revenue Code for all business property such as real estate, machinery, equipment, and vehicles.  Generally, a like-kind exchange, allows the gain to not be recognized on the tax return under Internal Revenue Code Section 1031. If, as part of the exchange, other (not like-kind) property or money is received, a gain to the extent of the other property and money received is recognized. You can’t recognize a loss.

However, under the Tax Cuts and Jobs Act, Section 1031 Like-Kind Exchanges applies only to exchanges of real property and not to exchanges of personal or intangible property. An exchange of real property held primarily for sale still does not qualify as a like-kind exchange. A transition rule in the new law provides that Section 1031 applies to a qualifying exchange of personal or intangible property if the taxpayer disposed of the exchanged property on or before December 31, 2017, or received replacement property on or before that date.

Thus, effective January 1, 2018, exchanges of machinery, equipment, vehicles, artwork, collectibles, patents and other intellectual property and intangible business assets generally do not qualify for non-recognition of gain or loss as like-kind exchanges. However, certain exchanges of mutual ditch, reservoir or irrigation stock are still eligible for non-recognition of gain or loss as like-kind exchanges.

 

Rehabilitation Credit:

The Tax Cuts and Jobs Act impacts the Rehabilitation Tax Credit for amounts paid or incurred for qualified expenditures after December 31, 2017. The credit is a percentage of expenditures for the rehabilitation of qualifying buildings in the year the property is placed in service.

The new legislation:

  • Requires taxpayers take the 20-percent credit ratably over five years instead of in the year they placed the building into service, and
  • Eliminates the 10 percent rehabilitation credit for the pre-1936 buildings.
  • A transition rule provides relief to owners of either a certified historic structure or a pre-1936 building by allowing owners to use the prior law if the project meets these conditions:
  • The taxpayer owns or leases the building on January 1, 2018 and at all times thereafter, or
  • The 24- or 60-month period selected for the substantial rehabilitation test begins by June 19, 2018.

Monthly Newsletter:

Don’t forget to sign up for our monthly newsletter written specifically for Real Estate Professionals by emailing info@integrityintaxllc.com to request a monthly email.

Thank you for reading my blog,

Tina

Tax Reform & Your 2018 Tax Return

Wondering how the new Tax Law will impact your tax return? Over the next week, we will be sending our 2017 clients a letter of the specific items that were reported on their 2017 tax return that, if reported in 2018, may be impacted for 2018 by Tax Cuts and Jobs Act.  This is just one of the many superior services we offer to our clients!

This new law affects many areas of tax. If you would like to discuss how this impacts your specific tax return, I’d love to meet with you!  You can contact me at 920-277-2991.

Here’s a look at some of the more important elements of the new law that have an impact on individuals. Unless otherwise noted, the changes are effective for tax years beginning in 2018 through 2025.

  • Tax rates. The new law imposes a new tax rate structure with seven tax brackets: 10%, 12%, 22%, 24%, 32%, 35%, and 37%. The top rate was reduced from 39.6% to 37% and applies to taxable income above $500,000 for single taxpayers, and $600,000 for married couples filing jointly. The rates applicable to net capital gains and qualified dividends were not changed. The “kiddie tax” rules were simplified. The net unearned income of a child subject to the rules will be taxed at the capital gain and ordinary income rates that apply to trusts and estates. Thus, the child’s tax is unaffected by the parent’s tax situation or the unearned income of any siblings.
  • Standard deduction. The new law increases the standard deduction to $24,000 for joint filers, $18,000 for heads of household, and $12,000 for singles and married taxpayers filing separately. Given these increases, many taxpayers will no longer be itemizing deductions. These figures will be indexed for inflation after 2018.
  • Exemptions. The new law suspends the deduction for personal exemptions. Thus, starting in 2018, taxpayers can no longer claim personal or dependency exemptions. The rules for withholding income tax on wages will be adjusted to reflect this change, but IRS was given the discretion to leave the withholding unchanged for 2018.
  • New deduction for “qualified business income.” Starting in 2018, taxpayers are allowed a deduction equal to 20 percent of “qualified business income,” otherwise known as “pass-through” income, i.e., income from partnerships, S corporations, LLCs, and sole proprietorships. The income must be from a trade or business within the U.S. Investment income does not qualify, nor do amounts received from an S corporation as reasonable compensation or from a partnership as a guaranteed payment for services provided to the trade or business. The deduction is not used in computing adjusted gross income, just taxable income. For taxpayers with taxable income above $157,500 ($315,000 for joint filers), (1) a limitation based on W-2 wages paid by the business and depreciable tangible property used in the business is phased in, and (2) income from the following trades or businesses is phased out of qualified business income: health, law, consulting, athletics, financial or brokerage services, or where the principal asset is the reputation or skill of one or more employees or owners.
  • Child and family tax credit. The new law increases the credit for qualifying children (i.e., children under 17) to $2,000 from $1,000, and increases to $1,400 the refundable portion of the credit. It also introduces a new (nonrefundable) $500 credit for a taxpayer’s dependents who are not qualifying children. The adjusted gross income level at which the credits begin to be phased out has been increased to $200,000 ($400,000 for joint filers).
  • State and local taxes. The itemized deduction for state and local income and property taxes is limited to a total of $10,000 starting in 2018.
  • Mortgage interest. Under the new law, mortgage interest on loans used to acquire a principal residence and a second home is only deductible on debt up to $750,000 (down from $1 million), starting with loans taken out in 2018. And there is no longer any deduction for interest on home equity loans, regardless of when the debt was incurred.
  • Miscellaneous itemized deductions. There is no longer a deduction for miscellaneous itemized deductions which were formerly deductible to the extent they exceeded 2 percent of adjusted gross income. This category included items such as tax preparation costs, investment expenses, union dues, and unreimbursed employee expenses.
  • Medical expenses. Under the new law, for 2017 and 2018, medical expenses are deductible to the extent they exceed 7.5 percent of adjusted gross income for all taxpayers. Previously, the AGI “floor” was 10% for most taxpayers.
  • Casualty and theft losses. The itemized deduction for casualty and theft losses has been suspended except for losses incurred in a federally declared disaster.
  • Overall limitation on itemized deductions. The new law suspends the overall limitation on itemized deductions that formerly applied to taxpayers whose adjusted gross income exceeded specified thresholds. The itemized deductions of such taxpayers were reduced by 3% of the amount by which AGI exceeded the applicable threshold, but the reduction could not exceed 80% of the total itemized deductions, and certain items were exempt from the limitation.
  • Moving expenses. The deduction for job-related moving expenses has been eliminated, except for certain military personnel. The exclusion for moving expense reimbursements has also been suspended.
  • Alimony. For post-2018 divorce decrees and separation agreements, alimony will not be deductible by the paying spouse and will not be taxable to the receiving spouse.
  • Health care “individual mandate.” Starting in 2019, there is no longer a penalty for individuals who fail to obtain minimum essential health coverage.
  • Estate and gift tax exemption. Effective for decedents dying, and gifts made, in 2018, the estate and gift tax exemption has been increased to roughly $11.2 million ($22.4 million for married couples).
  • Alternative minimum tax (AMT) exemption. The AMT has been retained for individuals by the new law but the exemption has been increased to $109,400 for joint filers ($54,700 for married taxpayers filing separately), and $70,300 for unmarried taxpayers. The exemption is phased out for taxpayers with alternative minimum taxable income over $1 million for joint filers, and over $500,000 for all others.

if you would like to discuss how this impacts your specific tax return, I’d love to meet with you!  You can contact me at 920-277-2991.

Thank you for reading my Blog!

Tina