Elizabeth Goff,Certified Public Accountant (CPA), Phoenix, AZ

Put these dates on your calendar

Among the tax deadlines you may be required to meet in the next few months are the following:

October 15, 2003 - Due date for filing your 2002 individual tax return if you received an extension of the August 15 deadline. (No more extensions allowed).

December 31, 2003 - End of tax year for calendar year taxpayers.

January 15, 2004 - 4^th installment of 2003 individual estimated tax is due.

January 31, 2004 - Employers are required to furnish 2003 W-2 statements to employees. Banks, brokers and other payers must furnish payees with Form 1099 information statements for various payments made.

January 31, 2004 - Employers must file 2003 federal form 940 for unemployment tax returns.

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Quote

“Americans are now in a daze from intaxication “ Unknown Author

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QuickBooks Tip

Graphing

Are you the type of person that relates to pictures much better than columns of numbers? If so you are in luck because QuickBooks makes it easy to look at financial reports as graphs. QuickBooks will show reports as bar graphs and pie charts. The following reports can be shown as graphs; Income and Expense, Sales, Accounts Receivable, Accounts Payable, Net Worth, and Budget vs. Actual.

To see a graph of your QuickBooks data, go to that section of reports and choose the one with the word graph in the title. For example to see a graph of the Income and Expense report; from the reports menu select Company & Financial, and choose Income and Expense Graph.

To set the dates on the graph, simply click the dates button at the top left of the graph and set the dates you would like.

Using QuickBooks graphs you can quickly see interesting facts about your business. For example you may want to know which of your customers buys the most from you. To find out you can create a Sales graph, and sort by customer to find out.

To find out the exact dollar amount behind a graph’s bar, pie slice, or data point, move your mouse to that display and hold down the right mouse button. The dollar amount will appear until you let go of the button.

If you’d like to see more detail about a specific bar, pie slice, or data point, move your mouse over the display and double click. The Quickzoom graph window will appear, showing you a breakdown of information by category, percentage and dollar amount.

Sometimes you don’t want to see all the data contained within a graph. To hide a pie slice or bar, move your mouse to the display, hold down the shift key, and click. The bar or slice will disappear.

Try using the graphs and see how it can help you understand your business better.

Note

The information included in this newsletter is general in nature, and should not be acted upon in your specific situation without further details and/or professional assistance.

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Quote (This applies to tax law)

" The simpler it looks, the more problems it hides.”

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Don't Pay Taxes On Your Dividends Twice

When you make an investment in a mutual fund (and sometimes even in single issue equities) you usually are given the option to reinvest dividends. This is an excellent way to obtain growth in your portfolio since dividends that you would normally receive in cash are automatically used to purchase additional shares of the mutual fund. There is usually only a minimal fee associated with this service, and it allows you to purchase additional shares without paying a brokerage fee.

Each year the mutual fund reports the dividends that you received whether paid in cash or reinvested and you pay tax on those dividends. When you sell that investment, you are taxed on the gain or loss. The gain or loss is calculated as the difference between sales price and purchase price. Since you have used dividends on which you have already paid tax to purchase additional shares, those reinvested dividends increase your basis, thereby reducing the taxable gain or increasing the loss. In order to properly calculate this basis you should retain all your brokerage statements relating to mutual fund purchases. Today mutual fund companies often track basis for you and can provide an “average cost basis” when you sell shares. However, their records only go back so far and if you transfer investments from one brokerage company to another they often cannot calculate basis for you. Therefore, it is prudent to maintain your own records because you are ultimately the one that benefits from proper calculations.

Should your Corporation Own Real Estate

Many people do not realize that it can cost you more in taxes for your corporation to own property such as real estate and securities. This is because non-corporations get a lower tax rate for the capital gains that result from selling such property.

It is best to own stocks, bonds, and other securities as an individual, or in an LLC or another non- corporate entity. That way you will get the lower capital gains tax rates when you sell them at a profit.

Many people have real estate that they rent for many years and then sell. They want some legal protection from lawsuits etc. while they rent the property. Having an LLC own the property can give you much of the same legal protection that a corporation offers, yet an LLC will get the lower capital gains rates of tax on the profit

Speed Up Your Tax Deductions

Your 4^th installment of 2003 Arizona and Federal individual estimated taxes is due on January 15, 2004. If you pay your Arizona estimated tax payment before the end of 2003, you can take it as an itemized deduction on your 2003 tax return. If you wait until January 15^th to pay it, you cannot take it as an itemized deduction until you file your 2004 tax return. Many people choose to pay the Arizona estimated tax payment in December because they do not want to wait a whole year more to take it as an itemized deduction.

You can also speed up the year you take medical deductions as an itemized deduction by paying them in December instead of January.

If you are planning on buying some equipment, furniture or other business assets, then you may want to purchase them before the end of 2003 so that you can get the deduction for them on your 2003 tax return.

Your referrals are appreciated

I appreciate when someone gives my name to a friend or associate who is looking for an accountant. Also, please let me know of anyone who would like to receive my newsletter. 602 468-0332 / egoff@goffcpa.com