How To Avoid FIRPTA Withholding

Original:  http://freedomtaxaccounting.com/how-to-avoid-firpta-withholding/

 

Now since the foreigners will be required to pay 15% on the purchase price instead of 10%, it can be very costly for them. Due to this reason, they are looking out for ways to avoid them and ask how to avoid FIRPTA withholding. They can do it by applying for Withholding Certificates. But foreigners must keep in mind that by applying for this certificate, they cannot entirely eliminate the requirement to file final United States income tax return in order to report the sale transaction. However, it can reduced to some extent which can lower the burden of foreigners and will not b every costly than before.   Foreigners who are asking how to avoid FIRPTA withholding must read this section carefully.

In order to avoid FIRPTA withholding, foreigners need to apply for the Withholding Certificates. So in order to learn the core of the question, how to avoid FIRPTA withholding, you need to understand the details carefully that are provided below.

Obtaining a Withholding Certificate Before the Sale

When a foreigner has Withholding Certificate is in hands, one may be able to reduce or completely eliminate (sometimes) the withholding requirement. Either the buyer of the seller, anyone can apply for the Withholding Certificate to the Internal Revenue Service (IRS) i.e. 26 CFR 1. 1445 – 3 (a). It is better to obtain a Withholding Certificate before the sale as they can withhold a reduced 10% amount of the sale price but a pending application cannot let this happen.

Issuance of Withholding Certificate

A Withholding Certificate is issued to minimize the rate so that the Internal Revenue Service (IRS) does not charge much interest and results in lower costs. This certificate is issue due to the following reasons.

• A declaration by the IRS that the reduced withholding is suitable because either the amount is withheld by the transferor's maximum liability or the withholding amount will not put the collection of the taxes at stake.


• The exemption from the United States tax of all gain has been realized by the transferor


• An agreement for the payment of tax providing security for the tax coverage by the transferor or transferee.

Forms You Require for Obtaining Withholding Certificate

The Treasury Department regulations provide sample certifications. They are basically used to obtain exemptions from withholding. The certification must state that the non resident alien for the purposes of United States income tax and declare that the certification is made under the penalty of perjury. The buyers who are concerned about how to avoid FIRPTA withholding must remember that they need to file the IRS forms 8288 and 8288 – A, and 8288 – B.

These forms must be provided to the buyer with a stamped and sealed copy to the IRS. The sellers are required to attach the forms with the tax return and any tax withheld will be credited against any tax due. In addition, the seller can use 8288 – B forms to either obtain a determination of the amount or the determination that no withholding is required. In order to know more about avoidance of FIRPTA withholding using form 8288, check out this link.

We can also help you get a withholding certificate so you do not have to pay the FIRPTA 10% tax. Please call us at 407-344-1012, or email us at info@freedomtaxfl.com for more information, or visit www.freedomtaxaccounting.com



 

Ecommerce Accounting

Original source:  http://freedomtaxaccounting.com/accounting-for-dropshippers/

 

The business of dropshipping is completely changing the inventory and merchandising game for retailers. It has made processes easier as the accounting for dropshippers is the responsibility of the suppliers. Accounting is a broader term, which is why it involves several aspects depending upon the type of business. Similarly, here we have highlighted some of the accounting aspects with respect to dropshippers. If you want to know the core of accounting for dropshippers, you must read this section very carefully.

We offer customized accounting solutions for dropshippers, and e-commerce business models. For more information about our tax accounting services call us at 407-344-1012, or email us at info@freedomtaxfl.com .

1.    Tax Challenges

As they say, tax and death is inevitable. Similarly, tax challenges are everywhere. Dropshipping can lead to tax consequences for all the parties that are involved. Taxes are one of the major parts of accounting for dropshippers. From tax perspective, if a retailer has nexus with a specific state or has willingly registered in the state, then the retailer is required to collect sales tax. In this type of situation, the customer will be required to pay off the taxes even if the purchase was exempted. However, establishing a connection in such situations is quite simple, things get a bit more interesting when the retailer does not have a link with the taxing state, but the shipper has it.

2.    Managing Invoices

Drop shipping has three main data integrations between the supplier and retailer including the product catalog, orders and inventory. The last and final step is the supplier invoices the retailer for the products that they sold and provided to the retailer's customer. Invoices are one of the major parts of accounting for dropshippers. They are almost similar as the manufacturers' and distributors' traditional inventory purchases but they have only one difference. The supplier's system generates an invoice on per order basis. The financial and accounting information including the payments terms round out of the rest.

We have formed a list of important data that should be coordinated among suppliers and retailers for effective accounting for dropshippers.

• invoice_id: It is the unique identifier that is generated by the supplier's account system.


• po_number: This is the identifier that is generated by the retailer's ordering system.


• invoice_sub_total_excluding_line_items: The total charges on the invoice should be shown and not related to the line items, SKUs


• invoice_amount: The amount of the invoice that is to be paid.


• invoice_due_date: The date of the invoice to when it is due.


• invoice_date: The date of the invoice.


• invoice_terms: The terms and conditions of the invoice such as “net 20”


• invoice_handling_cost: The cost of handling for the invoice, if it is different from the handling costs of line items SKUs.


• invoice_discount_due_date: The date due on when the invoice is set to be received at discount.


• invoice_buyer_id: The unique identifier of the retailer in the supplier's accounting system.


• invoice_sales_tax_amount: The sales tax amount of the invoice should be shown if it is different than the first item.


• ship_to_company: The name of the company of the customer who will receive the invoiced order.


• ship_to_address_1: Address 1 is the main address of the customer who will receive the invoiced order.


• ship_to_address_2: Address 2 is the alternate address of the customer who will receive the invoiced order.


• ship_to_city: Name of the city of the customer who will receive the invoiced order.


• ship_to_region: The name of the region of the customer who will receive the invoiced order.


• ship_to_postal: The postal code of the customer's region who will receive the invoiced order.


• ship_to_country: The country of the customer who will receive the invoiced order along with the two character ISO code for the country.


• invoice_batch_id: It is the batch identifier also known as unique identifier that invoice.


• invoice_batch_total: The complete amount of all the invoices given in one single batch.


• invoice_status: It is the declaration status of the invoice such as “paid” or “outstanding”.

All these determinants regarding the invoices must be settled at the first place between both the parties i.e. the retailer and the supplier. These determinants need to be clearly identified, coordinated, and discussed initially as they are an important part for the accounting for dropshippers. Here are a few more things that you need to consider for invoices:

• Shipping costs


• Invoicing frequency


• Single item orders


• Returns


• Accuracy and delay


• Handling and drop shipment fees

3. Inventory Management

One of the most important aspects of dropshipping is its efficient inventory management. Retailers often pair down offers which reduce the risk on their part. Also, products can really stand out in dropshipping and can identify new opportunities for the retailer.

If there is a certain product which is over performing on dropship, it will be an opportunity to bring that item into the store and test out if that product is good enough to physically carry out or not. There are some individuals who are unable to manage the inventory which is ultimately, badly affecting the accounting for dropshippers. So, below we have provided some tips to efficiently manage the inventory.

• Retailers must understand that all dropshippers are not the same.


• They need to avoid overselling.


• Retailers must know that successful drop shipping depends on details.


• They need to organize, centralize and integrate the order management, accounting for dropshippers and inventory management.


• They must pick the products wisely or take advice from some seasoned people of the similar industry.


• You need to use multiple suppliers to manage inventory.


• Retailers need to use generics for their advantage.


• They must ensure about the item's availability.


• They should deal with the out of stock orders.

4.  Varying Profit Margins

Like all other businesses, profitability and revenue stream depends on a number of variables. But once it is done correctly, no one can stop you from creating a highly profitable online business, or a dropshipping business in this context. When we talk about dropshipping business, it is not a magic formula, and the real success requires constant effort and a lot of time, but it is a very feasible online business model associated with very low risk. Once you commit to a long term endeavor, your dropshipping business can go up and grow exponentially.

Additionally, profit margins will vary greatly on the basis of the products you will sell. Those who are operating in expensive electronics, the margins will be thin and be in between 5% and 10% range. But if you operate in low priced accessories, the margins are greater, they are 100% instead. Not only the nature of the products matter, it is also the value you offer to your customers. It allows you to charge a premium over your competitors.

5.    Cost Benefit Analysis

When we refer to accounting for dropshippers, one of the important aspects is cost benefit analysis. According to Justin Drage, the cost benefit analysis plays out in the favor of the retailer with the desire to serve what is in the best of the interest of their customer. According to the researchers, the discussion of the cost benefit analysis for the dropshipping business has been quite interesting.

They found that the profit margins of the retailers were balance out by saving logistics costs by avoiding the tying up capital, saving the sale and carrying the stale stock and where the retailer has had an discontent customer. The costs benefit analysis is really in favor of dropshippers.

6.    Positive Cash Flow Cycle

Among all the specified benefits of the dropshipping business and accounting for dropshippers, two of prominent benefits are upfront inventory and a positive cash flow cycle. A positive cash flow occurs in the dropshipping when the seller is paid on the making the purchase. Generally, the seller pays the wholesaler with the help of a credit card or credit terms. For this reason, there is a period of time where the seller has the customer's money but they have not paid them to the wholesaler.

Moreover, it can be an advantage for retailers when there is no middle man in between the direct communication of a wholesaler and a retailer; hence, saving costs and delay in physically sending the goods to the ultimate customers.



For more information about our tax accounting services call us at 407-344-1012, or visit www.freedomtaxaccounting.com

Start LLC Without Tax Id

http://www.itinnumberonline.com/how-to-start-an-llc-without-an-itin-number/Original source: http://www.itinnumberonline.com/how-to-start-an-llc-without-an-itin-number/



If you are pondering over how to start an LLC without an ITIN number, another thing you should deliberate upon is that is getting one really necessary in order to open an LLC in USA. Briefly speaking, an ITIN number is not really required to open an LLC but what one does require is an EIN number. There is a common belief that without getting an ITIN number, a foreign individual cannot open an LLC in USA. Likewise, most people also think that in order to apply for an EIN number, a foreign investor must also have an ITIN number or a social security number. Both of these beliefs are entirely wrong as companies or their owners who wish to bring their limited liability businesses in USA do not really need to obtain an ITIN number in the first place.

How to Start an LLC Without an ITIN Number?

Now as we have already mentioned, it is not really important to get an ITIN number to open an LLC in the USA, it is also important to bring to your knowledge that obtaining an EIN without an ITIN is a complex and intimidating task but it is not impossible. To be able to do business in USA, you must obtain Employer Identification Number

It is not really mandatory to obtain ITIN and SSN to get an EIN number for most of the residents of the USA as well as those foreigners who wish to start a new business in USA. Therefore, such people must not fret on how to start an LLC without an ITIN number.

 

Steps Involved in Starting an LLC without an ITIN Number

Acquiring an EIN is daunting because it consumes a lot of time. The foreigners interested in obtaining an EIN need to know the application process for obtaining it. You can find more information about getting an EIN without an ITIN number over here (INSERT LINK FOR THE BLOG HOW TO GET AN EIN NUMBER WITHOUT AN ITIN NUMBER).

1. Having a Trustworthy Business Accountant

All the foreigners wanting to set up an LLC in USA must have a trustworthy accountant. The accountant must be able to represent the company as a third party designee.

2. Preparing the Application

The accountant will also have to help you prepare the application for EIN. All of the necessary documents need to be assembled for the application of EIN.

3. Getting in Touch with the Internal Revenue Service

After all the documentation is complete, and the accountant has readied it for the application process you will be required to approach the IRS at the foreign investors centre and then fax a signed form to the IRS.

4. Obtaining the EIN

When your application is successful, that is, the IRS approves of it, your business accountant will have to collect the employee identification Number if you mention the name in the third party designee portion of the application form.

As you know the procedure for how to start an LLC without an ITIN number, you may have realized that the role of an accountant is crucial. And having a professionally sound trustworthy and loyal accountant will help to make the process easier and smoother for you. It is because of the services of a really good accountant, you are able to get an EIN without an ITIN and SSN.



If you would like a consultation on how to open an LLC without an ITIN number please call us at 888-509-3616, or visit www.itinnumberonline.com

Get Business Tax Id Without ITIN

Source: http://www.itinnumberonline.com/how-to-get-an-ein-number-without-an-itin-number/



This guide on how to get an EIN number without an ITIN number discusses everything from the concept of EIN to the tips, confusions and common problems.



If you are wondering about how to get an EIN number without an ITIN number then it may be a little surprising for you to know that you can apply for the EIN number even without the ITIN. Below are the steps for applying the EIN without ITIN.

• You will need a third party corporate designee, like a business accountant, or corporate lawyer.


• The business accountants are professionally trained to prepare the applications for obtaining the EIN without ITIN. They will prepare the application on your behalf.


• After preparing the application, the accountant will contact the Internal Revenue Service and ask the requirements for the international applicants. The tax accountant will prepare all the documents and send the file via fax to the IRS.


• The IRS will process your application and send the Employer Identification Number to the business lawyer within two to five weeks.

If you would like us to get your EIN number without an ITIN number please call us at 888-509-3616, or email us at info@freedomtaxfl.com .

You can also apply for the Employer Identification Number on your own. However, the case becomes complicated if you do not have the Individual Taxpayer Identification Number. Therefore, it is highly recommended that you should always hire a professional business tax accountant to process your application and resolve complications from the process of how to get an EIN number without an ITIN number.



www.itinnumberonline.com



 

Start a Non Profit in FL

Original source:  http://freedomtaxaccounting.com/how-to-start-a-501c3-in-florida/



If you want to run a nonprofit corporation but do not know how to start a 501c3 in Florida, then we are going to tell you everything about how to start a 501c3 in Florida in this post.

·       What is a 501c3

In order to know how to start a 501c3 in Florida, you must first know what it is. 501c3 is a subsection in under the Internal Revenue Code of the United States and relates to the tax laws of nonprofit corporations. According to 502c3, nonprofit corporations are exempted from paying taxes if the activities they conduct have the following purposes:

• Charity


• Religious


• Public safety


• Education


• Scientific


• Preventing cruelty to animals or children


• Fostering amateur sports competitions

If you want to start a nonprofit corporation that has one of the aforementioned purposes, then you will have to register your corporation under 501c3. Read on to know more about how to start a 501c3 in Florida.

 

Step #1. Establish a Nonprofit Corporation

This a state-level process that establishes a nonprofit, corporate entity by the filing of Articles of Incorporation. The vast majority of nonprofits organize as corporations for a variety of reasons, including liability protection for the officers, directors and other key individuals.

Step 2. Obtain 501(c)(3) Status

This next step is much more complex than incorporating. To obtain 501(c)(3) status, a nonprofit corporation must apply to the Internal Revenue Service for recognition of tax exemption by filing IRS Form 1023. Relatively speaking, forming the corporation is fairly straightforward (assuming that one completely understands the process). Applying for 501(c) (3) status, on the other hand, is quite subjective.

Form 1023 itself is up to 28 pages long. With the required attachments, schedules and other materials that may be necessary, it is not uncommon for these submissions to the IRS to be more than 50 pages. Think of Form 1023 as an IRS examination. Instead of an audit of a tax return, the 501(c)(3) application process is more like an audit of proposed (and/or previous) activity. It is a thorough examination of the organization's governing structure, purpose and planned programs. The IRS is looking to make sure that the organization is formed for exclusively 501(c)(3) purposes and that its programs are designed to fulfill these stated purposes. In addition, the IRS is looking closely for conflicts-of-interest and the potential for benefit to insiders, both possible grounds for denial.

 

Step 3. State Compliance Issues

Thought you were finished with Step 2?  Not quite.

While obtaining 501(c)(3) status grants your new nonprofit federal tax exemption, there are several other, critical issues that must be addressed.

1. Charitable Solicitations Registration – This is a required registration in 40 states and is usually administered through the Attorney General's office, though not always.  Most states require registration prior to soliciting donations.


2. State Corporate Tax Exemption – Most states recognize the federal 501(c)(3) status as valid for state corporate tax exemption.  California is a big exception, requiring its own application and review process for charity status.  Several other states require a separate application, but those are typically simpler registrations.


3. State Sales Tax Exemption – Many states grant an exemption to charities that allows them to purchase items for use by the organization without having to pay sales tax.  Applying for exemption usually requires a nonprofit to have already obtained 501(c)(3) status.


4. For more information visit www.freedomtaxaccounting.com

Elegir El Servicio Adecuado Para La Preparación De Declaracion de Impuestos

Original source:  http://freedomtaxaccounting.com/sp/elegir-el-servicio-adecuado-para-la-preparacion-de-impuestos-cosas-que-debe-considerar/

 

Aquí hay algunos consejos que debe mantener en cuenta al elegir un preparador de impuestos:

• Asegúrese de que el preparador tiene un número de identificación de preparador de impuestos o PTIN, por sus siglas en inglés. Cualquier persona con un número PTIN del 2015 está autorizado para preparar declaraciones de impuestos federales. Sin embargo, los preparadores de impuestos tienen diferentes niveles de preparación, educación y experiencia. Una diferencia importante en los tipos de preparadores es el “derecho de representación”. Puede ver más sobre los diferentes tipos de preparadores de declaraciones de impuestos en IRS.gov/chooseataxpro. (en inglés)
  
   


• Pregúntele al preparador si tiene una credencial profesional (agente, contador público, abogado), si pertenece a una organización profesional o si asiste a clases de educación continua. Algunos cambios a las leyes tributarias, incluyendo las provisiones de la Ley de Cuidado de Salud de Bajo Precio, pueden ser complejas. Un profesional de impuestos capacitado necesita estar al día sobre estos temas. Los preparadores de impuestos no están obligados a tener una credencial profesional, pero asegúrese que usted comprenda las calificaciones del preparador que selecciona.

• Pregunte acerca de los honorarios por servicios.  Evite a los preparadores que basan sus honorarios en un porcentaje de su reembolso o aquellos que dicen poder conseguirle un reembolso mayor al que otros pueden conseguirle.
  
   


• Siempre asegúrese de que cualquier reembolso pendiente le sea enviado a usted o depositado a su propia cuenta bancaria. Los contribuyentes no deben depositar sus reembolsos en la cuenta bancaria de un preparador.

• Cerciórese de que su preparador ofrezca e-file y pida que su declaración sea presentada al IRS electrónicamente. Cualquier preparador pagado que prepara y presenta más de 10 declaraciones de clientes debe presentar las declaraciones electrónicamente. Es la manera más segura de presentar su declaración, ya sea que lo haga usted mismo o le pague a alguien por preparar su declaración.
  
   


• Asegúrese de que su preparador esté disponible.  Esté seguro de que podrá comunicarse con su preparador de impuestos después de presentar su declaración – incluso después de la fecha límite del 15 de abril. Esto pudiera ser útil en caso de que tenga preguntas acerca de su declaración de impuestos.
  
   


• Proporcione archivos y recibos.  Un buen preparador pedirá ver sus archivos y recibos. Le hará preguntas para determinar el total de sus ingresos, deducciones, créditos tributarios y demás. No use a un preparador que está dispuesto a presentar su declaración con e-file usando su último talón de pago en lugar de su Formulario W-2. Esto está en contra de las reglas de e-file del IRS.
  
   


• Nunca firme una declaración en blanco.  No use a un preparador de impuestos que le pide firmar una declaración de impuestos en blanco.
  
   


• Revise su declaración de impuestos antes de firmarla. Antes de firmar su declaración de impuestos, revísela y haga preguntas si algo no está claro. Asegúrese de sentirse cómodo de la exactitud de su declaración antes de firmarla.
  
   


• Cerciórese de que el preparador firme e incluya su número de PTIN.  Los preparadores pagados deben firmar las declaraciones e incluir su número de PTIN como lo exige la ley. El preparador también debe darle una copia de la declaración.
  
   


• Reporte al IRS sobre preparadores de impuestos abusivos. Puede denunciar a los preparadores de impuestos abusivos y sospechas de fraudes de impuestos al IRS. Utilice el Formulario 14157, Denuncia: Preparador de Impuestos (en inglés.) Si usted sospecha que un preparador presentó su declaración o cambió una declaración sin su consentimiento, también debe presentar el Formulario 14157-A, Fraude de Preparador de Declaraciones o Declaración Jurada de Mala Conducta (en inglés).  Puede obtener estos formularios en IRS.gov.


• Para mas informacion 


• Para mas informacion puede entrar a www.freedomtaxaccounting.com

​​

How to Start a Business in Orlando, FL

Original Source: ​http://freedomtaxaccounting.com/how-to-start-a-business-in-orlando-fl/

 

What form of business structure is recommended for a new business and what form of business structure is needed to maximize your effectiveness and minimize your costs?

Each form of business structure:  -•  Sole Proprietorship -•  Partnership -•  Corporation  -•  Limited Liability Company  They have advantages and disadvantages. The one you should choose depends on your specific circumstances. You need to discuss this with your lawyer and tax adviser. Choose your legal structure carefully. The type of legal structure will determine what type of taxes you'll pay and the tax forms you'll file. The choice you make will stipulate your legal and financial liability.   Business Tax Receipt (BTR) (formerly known as Occupational License) Are you opening a new business in the City of Orlando or are you moving your existing business into City limits? The City of Orlando issues licenses to those businesses, professions or occupations that have locations or branch offices within our City limits. The Business Tax Receipt is proof of payment of the business tax. It is required before a business opens.

In a ranking of the 20 cheapest cities to set up shop, Florida appears five times, with Orlando claiming the top spot. Jacksonville finished third, and Broward County ranked 20^th. Tampa Bay was seventh, and Palm Beach County came in at 16^th.



 For more info on how to open a business in Orlando visit ​http://www.freedomtaxaccounting.com

Get EIN Without SSN nor ITIN

Original Source:  http://freedomtaxaccounting.com/how-to-get-ein-number-without-ssn-nor-itin/  



People who either have an SSN number, or an ITIN number can easily get EIN number but the ones who neither have an SSN number nor an ITIN number often ask how to get EIN number without SSN nor ITIN. This blog covers all the information you need to know about how to get EIN number without SSN nor ITIN. 

 

What is a Social Security Number (SSN)?

Prior to understating how to get EIN number without SSN nor ITIN number, you must first understand what an SSN number is. An SSN is a Social Security Number comprising of nine digits and function as tax identification numbers. It is issued to individuals who are a permanent resident, citizen or temporary alien resident of the United States who are either employed or are working in the United States. 



 

What is an Individual Taxpayer Identification Number (ITIN)?

The ones who want to have a clear understanding about how to get EIN number without SSN or ITIN number, they need to know about an ITIN number. Individual Taxpayer Identification Numbers are issued to foreign individuals that are not eligible for the SSN number. Such people are also required to file tax returns. These numbers are comprised of nine digits starting from number 9 and have a range of 70 to 88 till its 4^th or 5^th digit. The range of the ITIN number is extended after its amendments on April 12, 2011. 

 

What is an Employer Identification Number (EIN)?

In order to learn how to get EIN number without SSN nor ITIN number, you should first clearly understand what an EIN number is. An EIN or Employer Identification Number is a nine digit number that is assigned by the Internal Revenue Service (IRS) to organizations. They are also known as Federal Tax Identification Number. This number is provided by the IRS to companies to identify who needs to file business tax returns. 



Let's have a look at the steps, which you must take to obtain an EIN number without SSN and ITIN number.

·      Step # 1: Credible Business Representative

The foreign investors and companies need to have a credible and loyal accountant who can represent as the third party designee for your business.

·      Step # 2: Preparation of Application

The next step is to prepare the application for your EIN number. Your accountant will be required to assemble all the documents and prepare an application for the Employer Identification Number (EIN).

·      Step # 3: Contact IRS

Once the accountant, prepares the application for the EIN number, they will be required to contact the Internal Revenue Service (IRS) Center for the foreign investors. After that, they will have to fax the signed form to the IRS office.

·      Step # 4: Getting EIN Number

If the application you submitted is considered genuine by the IRS, the authority will accept it and the business accountant you hire will be required to collect the EIN number on your behalf. 



For more info visit...www.freedomtaxaccounting.com

How to Get B1 Visa

Origianal source:  http://freedomimmigrationusa.com/how-to-get-business-visa-for-usa/

 

About the Visa Application Process

It's important to understand some basics about steps in the visa process. U.S. Embassies and Consulates in more than 200 countries overseas continue to have the responsibility under immigration law for the acceptance and processing of visa applications, and decisions about issuance of visas for foreign citizens to travel to the U.S. The Business Visa Center does not change the steps in the visa process nor can it interfere in the visa process.

 

Getting Business Visa for USA

If you wish to enter the United States for a business trip, then it is mandatory for you to submit a formal application to get business visa for USA. However, nationals of certain countries do not necessarily have to apply for a nonimmigrant visa if they are participating in the Visa Waiver Program which is described below. For detailed information on the application process for Business Visa for the United States, you may visit the following website https://travel.state.gov//content/travel/en.html.



For more information visit.  www.freedomimmigrationusa.com