Guest Blogger

Does the IRS Call You?

Today, Anat Borodyansky authors our HM&M blog.

Ring ring, ring ring…. have you ever been asked why aren’t you picking up your phone?

Well, in my case it’s because the phone number from which I’m receiving the “call” appears to be following a pattern of repeating the first 6 digits of my number… and when it goes to voicemail, a nice automated machine tends to inform me that the IRS is coming to get me!

Apparently the IRS has nothing better to do than call unsuspecting CPAs and tell them that they’re going to jail.

I’ve also heard from multiple clients, colleagues and friends that the IRS is calling them too. Either our government increased their budget and the IRS personnel has nothing to do but intimidate the poor taxpayers, or this is a scam. Considering that we know the reality of the IRS never calling the taxpayer directly and never threatening jail time or any immediate actions without the chance to review the case of any outstanding taxes and appeal the “tax due”, I just let the phone go to voicemail and block yet another number.

According to a recent article in the New York Times the US was able to break up a fake I.R.S phone scam and the guilty are going to be in jail for a long time because they’ve called the wrong people. The described scam involved folks from various states and a call center in India, so that’s probably who has been trying to reach me – wow! I feel even better for not picking up!

So please be aware that the IRS is likely not behind the weird call you’re receiving, but if ever in doubt, let it go to voicemail and forward the message to your trusted HM&M CPA for a chuckle and peace of mind for you.

Click here for a reminder of what the IRS will and will not do from their own website as a reference.

I’ve enjoyed walking a blog in Vance’s shoes, thank you for allowing me to share my thoughts with you!

– Anat

Click here to read this blog post and others on our website at www.hmpc.com

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Guest Blogger

Bitcoin! (Now That I Have Your Attention, Let’s Talk Taxes)

Today, Carrie Reese authors our HM&M blog.

I was raised by a Marine and a CPA. To put it lightly, following the rules was a BIG deal growing up. Naturally, when Bitcoin (the first virtual currency) started weaving through the news in 2010, I clutched my pearls while being simultaneously positive that this information would never apply to me. At that time, virtual currency was almost exclusively used in a black market economy, trading for drugs, weapons, and other sorts of nefarious things not suitable to be mentioned in a professional blog. It was the wild, wild west of impropriety. In other words, for me, it was an instant tune-out topic. Or so I thought.

Fast forward a few years. I’ve received my CPA license, and have spent several years in public accounting. I was quite happy following all the rules (see, above). One day I received an email from a client that had unknowingly gotten in over his head with Bitcoin. He was a medical professional who had been looking to invest some of his money, and was not even the slightest bit interested in the black market trade I had heard about so long ago. He had opted to invest in virtual currency using an online exchange.

He had invested in Bitcoin at just the right time. He, like many of you, had done some research, and decided that Bitcoin would be a good investment. And you know what? He was right. Like, in the millions of dollars right. He began trading his Bitcoin for Ethereum, a little bit of Litecoin, and even some Bitcoin Cash (nope, not the same thing).

When he contacted me, he mistakenly assumed that since he had put money into the exchange, but not taken it out, that no taxable event(s) had taken place. It was my unfortunate duty to explain to him that each time he made a trade, he was subject to capital gains (or losses) on that trade. Virtual currencies, while residing in the same exchange, are not ‘all for one, one for all’. These are completely different assets. Not currencies.

For those of you interested in investing in virtual currency, you will want to be very mindful of your activity. You will want to be cognizant of a taxable event occurring when you are trading. A great way to mitigate your risks is to keep accurate records at the onset of your virtual currency endeavor. A great CPA helps, too.

Guidance from the IRS is still murky, and the last time an official notice on virtual currency was released was 2014. But be assured, the IRS reads the news. They know people are making money, and they want their piece of the pie. Regulations are already being put in place to require exchanges to share information on their users with the IRS. I expect we’ll see a lot more to come on this in the next year, but in the meantime, be careful. It’s still a little wild wild west-y out there.

Carrie J. Reese, CPA

Click here to read this blog post and others on our website at www.hmpc.com