Ask Suzanne

I’m a sole proprietor and my business earned only $1,000 this year. Do I have to file a tax return?
You have to file if net earnings from self employment are at least $400. Why? To pay into your self employment social security account.
I’m looking for a new job in my current field…can I deduct career counseling fees?
Yes, the expenses are deductible on Schedule A as long as they total more than 2% of your adjusted gross income.
How long should I keep my records?
Cancelled checks, bank statements and receipts should be kept for three tax years.
Are parking tickets deductible?
Sorry, parking tickets or other fines are not deductible.
I’m self employed and own three different businesses. Can I combine them and file only one schedule C?
You need to keep separate books and file a separate Schedule C for each business.
What is a profit & loss statement and why do I need one?
A profit & loss statement (also known as income and expense) gives you an instant snapshot of your business. Looking at your p&l on a monthly or quarterly basis allows you to see if you’re meeting your goals or if you need to modify them. By using this tool to assess your business, Suzanne can annualize the numbers and adjust your estimated tax payments accordingly, often resulting in a tax savings.
How can I avoid being audited by the IRS?
While there are no guarantees, here are some guidelines that may help you avoid an audit. Keep in mind that as your income increases, so does your chance for an audit. Also, self-employed taxpayers are more likely to be audited than those who are employed.

Make sure that your deductions are in line with your income
The type of deduction should be appropriate for your business
Hire a tax professional if you have a complex return, don’t try to do it yourself
Math errors, an unsigned returned or a messy return (yes, neatness counts!) could trigger an audit

Why should I e-file?
It’s faster, cleaner, more efficient. An e-filed return is processed in four steps vs. 13 steps for a mailed return. And, since you don’t have to wait in line at the post office you save precious time and get your refund sooner. To really expedite things, you can have your refund electronically deposited into your bank account.
Can I hire you to handle my bookkeeping even if I use a different tax preparer?
Of course! As a full service bookkeeper, I will work with you to ensure that you have all your financial information in order for your tax professional.
What happens if I can’t pay my taxes?
Generally the IRS will accept an installment agreement (Form 9465) if the unpaid liability is $25,000 or less and the tax will be paid within five years. However, if you already have an installment agreement in effect from a prior year, you may not file again. There is a user fee for the installment agreement, and interest and late payment penalties still apply. If you can’t pay your California state taxes, you may file a Form 3567 to arrange for installment payments, although different rules apply.
What is an Enrolled Agent?
An Enrolled Agent (EA) is a tax professional who is licensed by the federal government to represent taxpayers before the IRS. Only Enrolled Agents, attorneys and CPA’s are allowed this privilege. In order to earn the license, a candidate must pass a comprehensive exam and undergo a rigorous background check. In addition, Enrolled Agents are required to complete 72 hours of continuing professional education, reported every three years, in order to maintain their EA status.
Why do I need an Enrolled Agent?
In case of an audit you want to be represented by a professional who is up-to-date in the continually changing world of taxes. Enrolled Agents have the expertise which qualifies them to represent taxpayers before the IRS.