Accounting
Art of Accounting: I practice what I preach
Published
6 hours agoon

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I write about what I did that was successful. It is my way of giving back to the CPA profession that has been great for me. I grew, as did my firm, my staff, my clients and everyone associated with my partners and me. I take great pride in the growth I burgeon. Some of what I did might seem nutsy, but I had my sights set on building a business and that required leveraging my partners and myself. And that took an investment that sometimes seemed unconventional. Here are three stories of some things I did:
Story 1: I always felt that the best way of training someone was for them to correct their own errors, no matter what! I figured that if they did, they would never make that type of error again, and they would also try to reduce future errors to avoid any inconveniences caused by having to fix them.
One time when I had my NYC practice, it was tax season and I called a staff person around 3:00. I told him he had to come to the office that night to fix an error on a tax return he prepared. I told him I wanted to get it out that night, it was going to be delivered by a taxi that night, and he had to fix it before 8:00. He lived in Queens and went to a client in Long Island. That was like a “vacation day” since he could easily drive to the client and also be home for an early dinner, with no overtime that night. He was a little put out, but he knew he had to come back. He called me a few minutes afterward and asked if he could drive to the office rather than take the subway, would we pay the parking, and I said we would. Also, we paid overtime, so he would get paid for the time fixing the return, but not for the travel time. When he got into the office, I showed him the tax return where he had to fix the zip code which he had wrong. That was the only error and, if looks could kill, I would have been dead at that very moment. He said nothing, fixed it and left.
I told this story about a dozen years ago at a CPE program and that staff person was sitting in the front row. He called out that it was him and remembered how angry he was at me. He also said that “because of that, I never made a mistake on a name or address ever again.” He also now had his own very successful practice. I didn’t remember who it was, but he reminded me. Question: If the reviewer fixed the zip code, how many future similar errors do you think he would have made?
Story 2: The first book I wrote was titled Successful Tax Planning. It was for businesspeople and was very successful. I decided I wanted to publish a professional edition to be sold to accountants and hired a law school student to add citations and references. He seemed like a go-getter, having previously worked part-time on a political campaign. I wanted to set a serious tone with him and also show him this was thoughtful research work, even though we were CPAs and not attorneys. At that time the Tax Code added Section 465. I held up a paperback copy of the Code, opened it to Section 465 and pointed to the word “interest.” I told him I needed a definition of that word and that we would meet in three days to discuss what he came up with. He looked at me like I was crazy, but when we met, he told me he did not have a clue.
My purpose was to show him that nothing in taxes and tax planning was simple or obvious and to get him to understand that I needed him to be very thorough, disciplined and exact, that maybe he didn’t know everything and perhaps I would be able to teach him something.
This project was never completed, getting pushed aside by more urgent or important projects and possibly by my losing interest in becoming a “book publisher.” However, he migrated into tax preparation and planning and some review work. We offered him a permanent job when he graduated law school and he stayed a few years, leaving for a “better opportunity” and ending up in his own tax practice. He built a substantial practice with one of his sons, also an attorney, who is now running it while he is pleasantly clipping coupons on a Florida beach.
My first “exercise” was my investment to get him on board with “my way of doing things.” It worked, and he did great work for us for the time he was with us.
Story 3: Sometimes when you meet a job applicant, there is a spark that shines through, and you just know this is the right person for you. That happened with a young woman we were interviewing. We hired her and sometime during the first week she was working on a humongous aged accounts receivable schedule. She completed it very well, but there was an error of, if I remember correctly, 11 cents in its being balanced perfectly. This was in the early days of computerized spreadsheets. I told her I needed it balanced exactly. She spent a couple of days on it and eventually got it to balance. I explained to her that the 11 cents wasn’t a concern or material. In fact it was completely immaterial, but I wanted her to learn that whatever she worked on had to balance. All she was doing was taking some numbers from one place and reproducing them in another place and there was no reason for them not to match.
That was my investment to teach her to be careful, work deliberately and that speed was not more important than error-free work. She worked for us for 10 years until she left for a job in private accounting close to her home and her three children. She was single when she started working for us.
There are many more stories, but I particularly like these as I am still in touch with these three people. Each story was costly at the time, but that became an investment that paid great dividends. I recommend taking the long view with your practice and to not miss any opportunity to train a staff person properly. My partners and I practiced what we preached, and we had a very successful practice. These ideas are being continued by us through Withum.
Do not hesitate to contact me at
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Last week, a senior IRS official told reporters that the IRS would be pausing its technology modernization efforts and reevaluating its approach to leverage artificial intelligence, according to
The IRS has also been facing questions over the security and privacy over the data in its systems after DOGE employees demanded access to its systems, leading to the
“The preliminary injunction that’s in place in New York v Trump prohibits any access to IRS data systems by people at DOGE or employed by DOGE,” said Anne Gibson, a senior legal analyst at Wolters Kluwer. “For the moment, that seems like it would prevent their access to IRS data systems, and if they were to access it, it would be in violation of the preliminary injunction. That said, this preliminary injunction is on the basis that the training, vetting and credentialing of the DOGE employees who did have access to Treasury data briefly was inadequate and wasn’t done properly. And the government is given an opportunity to file a report with the court explaining how they would give DOGE employees proper training, proper oversight, proper vetting, and if they could do that, the preliminary injection would be reconsidered, and that process has actually already started.”
A key date in that process is today. “The government submitted a report,” said Gibson. “It seemed to be only in relation to only one employee, but the court, on the basis of them following that report, set up a new briefing schedule, the final pieces of which are due on the 17th of March, so an opportunity for the government to file their motion, and for the states to file their opposition motion, and then for replies. That’s all due by March 17, and then we could see further action from the court, so there’s a possibility that that preliminary injunction, if the court is happy with the government’s new process, could be lifted relatively soon.”
A
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Accounting
The tax pros and cons of charitable remainder trusts
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March 17, 2025
For clients with highly appreciated assets aiming to transfer part of their holdings to an heir in a tax-efficient way while giving to a nonprofit, charitable remainder trusts could be a fit.
Charitable remainder trusts (CRTs), charitable remainder annuity trusts (CRATs), charitable remainder unitrusts (CRUTs) or net income charitable remainder unitrusts (NICRUTs) are simply potential pieces of a multifaceted estate plan — but financial advisors, tax professionals and, especially, their clients could be forgiven for getting a bit of a headache when seeing their accompanying acronyms. At the basic level, wealthy families use charitable remainder trusts to get a tax deduction for the donation, avoid capital gains duties and provide income to a beneficiary.
While they are “something that is not going to be applicable to everyone,” charitable remainder trusts may act as “a spoke in the wheel” in an estate plan, according to Eric Swensen, a wealth advisor and the chief planning officer with Walnut Creek, California-based
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The end of the
“You should be looking at your Social Security, IRAs and 401(k) distributions as your main source of income,” he said. “CRTs can be good for a portion of the assets to help support that primary income in retirement. … If you have enough assets for yourself, and you want to be able to help aging parents or other beneficiaries with income, this can be a good option as well.”
To illustrate what charitable remainder annuity trust can do, a
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Complicating factors
The paper details the many complexities involved with how each type of asset interacts with the others inside the estate’s holdings, and lays out possible methods for addressing them. The difference between a charitable remainder annuity trust and a charitable remainder unitrust comes from the greater flexibility in the latter vehicle, which enables adjustments to the payments to beneficiaries based on shifts in value each year, Swensen noted. The annuity vehicle pays the beneficiary the same set percentage or dollar amount each year. Alternatively, the net income version could give clients and their heirs more wriggle room if they’re currently living in a high-tax state yet plan to migrate to one with lower duties some day.
“You can set it up now, you can get the deduction now, but you can defer the income until later,” Swensen said. “It’s a great highly leveraged gift, especially if you have a big spread in your cost basis there.”
Charitable remainder trusts pose some risks, though, from the ramifications to their payouts based on downturns in stock values or other problems with the underlying assets. The failure of a business tied to a charitable remainder trust for one Swensen’s clients unfortunately led to the vehicle never passing any assets to the philanthropic recipient, he said.
“I inherited a client who had put an investment in a vineyard into a CRT, and that vineyard went under. Lucky for them, they were able to get the deduction up front,” Swensen said. “These things aren’t bulletproof, and don’t always work out in all the ways.”
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Those caveats explain why only a few out of more than 900 clients working with his firm are using charitable remainder trusts. Regardless
“Once you build that team, it also helps with confidence for talking with clients about them, too,” he said. “So, when it does come up, I can tell that client, ‘Hey not only do I think this is a great solution for you, but I’ve got a team in place that can make this really easy for you.'”
Accounting
IRS approaching major layoffs, cuts as tax season heats up
Published
4 hours agoon
March 17, 2025
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Between multiple waves of layoffs and legislative efforts to pull back more than $20 billion in funding, the gradual declawing of the Internal Revenue Service is well underway.
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Mark Koziel, president and chief executive of the AICPA, said in a March 7 statement that his organization has been in ongoing talks with IRS officials to clarify any news that comes out of the agency and “assess the immediate and long-term implications.”
“The ability of the IRS to maintain service levels for taxpayers and their preparers is critically important to the AICPA,” Koziel said. “IRS services in combination with modernization efforts, which include technology advancements, have been the bedrock of AICPA’s recommendations for many years.”
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