Archive for News

Prevent and detect insider cyberattacks

In one recent cybercrime scheme, a mortgage company employee accessed his employer’s records without authorization, then used stolen customer lists to start his own mortgage business. The perpetrator hacked the protected records by sending an email containing malware to a coworker.

This particular dishonest worker was caught. But your company may not be so lucky. One of your employees’ cybercrime schemes could end in financial losses or competitive disadvantages due to corporate espionage.

Best practices

Why would trusted employees steal from the hand that feeds them? They could be working for a competitor or seeking revenge for perceived wrongs. Sometimes coercion by a third party or the need to pay gambling or addiction-related debts comes into play.

Although there are no guarantees that you’ll be able to foil every hacking scheme, your business can minimize the risk of insider theft by implementing several best practices:

Restrict IT use. Your IT personnel should take proactive measures to restrict or monitor employee use of email accounts, websites, peer-to-peer networking, Instant Messaging protocols and File Transfer Protocol.

Remove access. When employees leave the company, immediately remove them from all access lists and ask them to return their means of access to secure accounts. Provide them with copies of any signed confidentiality agreements as a reminder of their legal responsibilities for maintaining data confidentiality.

Don’t neglect physical assets. Some data thefts occur the old-fashioned way — with employees absconding with materials after hours or while no one is looking. Typically, a crooked employee will print or photocopy documents and remove them from the workplace hidden in a briefcase or bag. Some dishonest employees remove files from cabinets, desks or other storage locations. Controls such as locks, surveillance cameras and restrictions to access can help prevent and deter theft.

Treat workers well. Create a positive work environment and treat employees fairly and with respect. This can encourage loyalty and trust, thereby minimizing potential motives for employee theft.

Wireless risk 

In addition to the previously named threats, your office’s wireless communication networks — including Wi-Fi, Bluetooth and cellular — can increase fraud risk. Fraud perpetrators can, for example, use mobile devices to gain access to sensitive information. One way to deter such activities is to restrict Wi-Fi to employees with special passwords or biometric access.

For more tips on preventing employee-originated cybercrime, or if you suspect a fraud scheme is underway, contact us for help.

© 2020

St. Louis Small Business Monthly, a regional publication serving the entrepreneurial and small business community, has recently named Wamhoff Accounting President Sandy Furuya to its 2020 list of St. Louis’ Best Accountants. The list appears in the publication’s October, 2020 issue, and is compiled based on reader nominations.

Furuya holds more than 30 years of experience in all facets of tax planning and accounting, serving individuals, non-profits, businesses and trusts. She and her team of tax professionals prepare nearly 750 returns each year and serve as consultants for clients throughout the year to help them appropriately navigate their unique financial situations.

“My passion for this industry began when I was quite young and has only grown as my career has progressed,” said Furuya. “My team and I are honored to have served generations of clients as they go through the various stages of life and business, and all of the transitions that come along with it. They rely on us to help them make informed decisions and feel prepared for tax season all year long.”

Wamhoff Accounting was established in 1975, with Furuya working alongside founder Bob Wamhoff since the early days of the firm. She assumed ownership in 2017, continuing the Wamhoff legacy of client service excellence and treating clients as part of the family. The firm has also been named to Small Business Monthly’s list of St. Louis’ Best Accounting Firms for nine years, and has received multiple Best in Customer Service awards

Services offered by the firm extend beyond taxes and accounting. Wamhoff Accounting also assists with bookkeeping, financial statements, and establishing new businesses. Free initial consultations are available upon contact, and individual tax returns can be completed within the day.

“I am honored to be included on this year’s list of St. Louis’ Best Accountants and am grateful for the support of our clients and area business owners who took the time to nominate me,” said Furuya. “As we prepare to enter a new tax season, I look forward to helping clients navigate the tax and financial implications of this past year and prepare them for the future.”

IRS announces per diem rates for business travel

In Notice 2020-71, the IRS recently announced per diem rates that can be used to substantiate the amount of business expenses incurred for travel away from home on or after October 1, 2020. Employers using these rates to set per diem allowances can treat the amount of certain categories of travel expenses as substantiated without requiring that employees prove the actual amount spent. (Employees must still substantiate the time, place and business purposes of their travel expenses.)

The amount deemed substantiated will be the lesser of the allowance actually paid or the applicable per diem rate for the same set of expenses. This notice, which replaces Notice 2019-55, announces:

  • Rates for use under the optional high-low substantiation method,
  • Special rates for transportation industry employers, and
  • The rate for taxpayers taking a deduction only for incidental expenses.

Updated general guidance issued in 2019 regarding the use of per diems under the Tax Cuts and Jobs Act (TCJA) remains in effect.

High-low method

For travel within the continental United States, the optional high-low method designates one per diem rate for high-cost locations and another for other locations. Employers can use the high-low method for substantiating lodging, meals and incidental expenses, or for substantiating meal and incidental expenses (M&IE) only.

Beginning October 1, 2020, the high-low per diem rate that can be used for lodging, meals and incidental expenses decreases to $292 (from $297) for travel to high-cost locations and decreases to $198 (from $200) for travel to other locations. The high-low M&IE rates are unchanged at $71 for travel to high-cost locations and $60 for travel to other locations. Five locations have been added to the list of high-cost locations, two have been removed and 10 that remain on the list are now considered high-cost for a different portion of the calendar year.

Although self-employed persons can’t use the high-low method, they can use other per diem rates to calculate the amount of their business expense deduction for business meals and incidental expenses (but not lodging), or for incidental expenses alone. (Employees can no longer deduct their unreimbursed expenses because of the suspension of miscellaneous itemized deductions by the TCJA, so these other rates are effectively unavailable to them.) The special rate for the incidental expenses deduction is unchanged at $5 per day for those who don’t pay or incur meal expenses for a calendar day (or partial day) of travel.

A simpler process

The per diem rules can greatly simplify the process of substantiating business travel expense amounts. If the amount of an allowance is deemed substantiated because it doesn’t exceed the applicable limit, any unspent amounts don’t have to be taxed or returned. If an employer pays per diem allowances that exceed what’s deemed substantiated, however, the employer must either treat the excess as taxable wages or require actual substantiation. When substantiation is required, any unsubstantiated portion of the allowance must be returned or treated as taxable wages. Please contact us to discuss the rules further.

© 2020

Our Big Move!

Wamhoff Accounting Services has relocated to a new location and we are all settled in! While we do understand the difficulties surrounding us all at the moment, when you are comfortable, stop by and take a tour of our office. A lot of hard work has been put into the move and I appreciate everybody that has made this move possible.
 
To Lorene, Susan, Martha, Sheila, Eva and Heidi, I appreciate you all for all of your hard work and dedication during this move. You have all helped make this transition as smooth as possible. Thank you all so much!
 
To Don Furuya and Dan Wrablik of Wrablik Construction, thank you both for your efforts in helping to make this move happen! Your hard work is deeply appreciated!
 
Here are some before/after pictures for you to enjoy. Once again, thank you all for making this happen for me and my team!
 
Sandy Furuya
 

Notice 2020-32 from IRS

In a recent ruling Notice 2020-32 the IRS stated the business owner will not be able to deduct the payroll costs, certain employee benefits such as healthcare and other benefits, as well as interest on mortgage obligations, rent, and utilities.

The recent ruling Notice 2020-32 provides guidance regarding the deductibility for Federal income tax purposes of certain otherwise deductible expenses incurred in a taxpayer’s trade or business when the taxpayer receives a loan pursuant to the Paycheck Projection Program. 

Specifically, this notice clarifies that no deduction is allowed under the Internal Revenue Code for an expense that is otherwise deductible if the payment of the expenses results in forgiveness of a covered loan pursuant to section 1106(b) of the CARES Act.

Happy Easter!

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