As part of the 2013 Best Undergraduate B-Schools ranking, Bloomberg Businessweek asked undergraduate business students from the Class of 2013 to tell us, via an online survey, about the full range of their business school experience, from getting in to getting a job. One section of the survey singled out specific aspects of the business program and asked the students to grade them on a scale of A to F. Over the next few weeks, we will publish the top 10 B-schools in each of 10 specialty areas, from accounting to sustainability, culminating with publication of the entire undergraduate specialty ranking, including each of the 124 ranked schools.

Today we look at accounting, the area of focus for nearly a quarter of all undergraduate business students. The ranking is based on student responses to the question asking them to rank their program’s accounting offerings. Points are awarded for each response—one point for an “A” grade through five points for a grade of “F”—and averaged for each school. The ranking is based on the average; schools with the lowest average are ranked the highest. If a student did not have exposure to the area in question, they could answer NA, and their response was not included. The average accounting score for all 124 undergraduate business schools in the ranking was 1.37. At the top of the list is Brigham Young University’sMarriott School of Management, with a score of 1.067. More at… http://www.businessweek.com/articles/2013-04-22/the-best-undergraduate-b-schools-for-accounting

Just because you can do something doesn’t mean that you should. You may be perfectly capable of cross-breeding trout with electric eels, for example, but you probably shouldn’t do it unless you’re very angry at fishermen.

http://www.usatoday.com/money/perfi/columnist/waggon/story/2012-07-12/self-directed-iras/56181024/1?csp=Dailybriefing

There’s good news and bad news for million dollar earners in 2012, with their state and local income tax bills down markedly in New York and Oregon, but up in Washington D.C. and Maryland. (Elsewhere, inflation adjustments mean tiny decreases.) We asked Wolter Kluwer’s CCH division to calculate the tax bill for a married couple with $1 million in salary, two children and $110,000 in itemized deductions, living in the largest city in each state. Here are the 10 highest bills.

http://www.forbes.com/pictures/mjd45ighf/the-highest-state-and-local-incomes-taxes-on-a-1-million-income/#gallerycontent

The age the typical worker expects to retire is no longer 65. For the first time this year, Americans expect to retire at an average age of 67, up from 66 in 2011, according to a recent Gallup poll of 1,016 adults. The average expected retirement age and been gradually increasing over the past seventeen years from age 60 in 1995 to 64 in 2005.
Some 39 percent of workers now plan to retire after age 65, up from 30 percent before the recession in 2007 and just 15 percent in 1995. Age 65 remains a popular retirement age, with just over a quarter (27 percent) of workers planning to retire then, a proportion that has remained fairly consistent over the past decade. Older workers generally expect to retire at a more advanced age than younger employees. Those age 40 and older are planning to retire at an average age of 68, compared to age 65 among people under 40. MORE AT… http://money.usnews.com/money/blogs/planning-to-retire/2012/05/08/the-new-ideal-retirement-age-67

Worried about a tax audit? Don’t be a prime target. Here’s what the IRS looks for and tips to help you avoid getting singled out.

#1: You have a sketchy tax preparer
Sometimes your tax preparer is to blame for an audit. If a preparer promises unusually high refunds without asking to see proper documentation for deductions and credits, don’t be fooled, said Vincenzo Villamena, CPA and managing partner at accounting firm Online Taxman. You’re legally responsible for the information on your return no matter what a preparer tells you, so make sure to look over your return before it’s sent to the IRS.
MORE AT…http://money.cnn.com/galleries/2012/pf/taxes/1203/gallery.audit-red-flags/?iid=SF_PF_Lead

From pet pigs to Playboy magazines, here are some of the most outlandish deductions taxpayers have tried to slip past the IRS

http://money.cnn.com/galleries/2012/pf/taxes/1203/gallery.wacky-tax-deductions/?iid=SF_PF_Lead 

Are you able to answer the questions that your clients are asking? This top 10 list will help.

If you understand my “Top Ten” list relating to Social Security then you will know more than 90% of all professional advisors:

1) SSB benefits are calculated using the highest 35 years of indexed earnings/wages. Zero earning years count in the calculation. Benefits are not computed based on the highest 3, 5, 7 or ten highest years or the best “20” quarters. 35 years of earnings are taken into account. Wages/earnings are indexed for inflation through the age of 59.

2) Earliest age to begin receiving retirement benefits is 62. Recipients must be 62 for the whole month. You are considered to have obtained your birthday on the day before your actual birthday. Thus, if you are born April 2nd then you will be considered 62 for the whole month. I was born on February 13th so I will have to wait until March (when I turn 62) to begin collecting benefits.

3) Full Retirement Age (FRA) for people born between 1943-1954 is 66. FRA is gradually increasing to age 67.

4) Benefits grow by 8% annually after FRA. This is considered delayed retirement credit. Maximum increase is a whopping 32% between ages 66-70. Please do not ignore the delayed retirement credits as many times a surviving spouse may step into the shoes of a deceased spouse. It might be advantageous for the deceased spouse to have begun collecting benefits as late as possible to maximize benefits for a surviving spouse.

5) Spousal benefit is 50% of the higher earning spouse FRA SS benefit. If lower earning spouse’s benefit (wife) on own work record is less than 50% of husband’s benefit then the wife’s SS benefit will be comprised of 2 parts – 1) SSB based on her work record (reduced for early retirement) and 2) part of spousal benefit. The total will equal 50% of husband’s benefit at FRA. Confused yet?

6) The surviving spouse benefit is 100% of the deceased spouse FRA benefit or the amount the deceased spouse was receiving at time of death. Surviving spouse can begin to collect the surviving spouse benefit at age 60. Benefits will be reduced by 29.5% if begun at age 60. Please do not forget about young children. Children under the age of 18 (or 19 if in high school) may be eligible for benefits upon the death of a parent. Additionally, if the surviving spouse is taking care of a child under the age of 16, then the surviving spouse may collect benefits at any age as long as the child is under age 16.

7) There is an earnings limitation if you begin to collect SSB prior to FRA. If under FRA, the maximum annual earnings you can earn is $14,160. The recipient’s SSB will be reduced $1 for every $2 earned over the amount. The maximum earnings in the year that the recipient turns FRA is $37,680 and the SSA will withheld $1 for every $3 earned over this amount. There is no earnings limitation beginning the month you reach FRA. Thus, a recipient can earn $1,000,000 the month that FRA is achieved without sacrificing any SSB.

8) A single person should consider the “claim and suspend” strategy. Under this strategy the individual will file an application for SSB at FRA but will tell the SSA not to send a check. Benefits will grow 8% annually (delayed retirement credits) until benefits are officially started. The individual will have a safety net. If he/she encounters financial difficulties, he/she can request that the SSA send all accumulative payments that have been withheld and to begin monthly benefits. The recipient will not receive any interest nor will benefits be increased for the delayed retirement credits but the recipient will have access to a sizable amount of funds. The “claim and suspend” strategy has no negatives and should be considered by all single filers. You will be a hero by recommending that your single clients consider this strategy.

9) For married couples strategies such as “claim and suspend” and filing a “restrictive application” should be considered. These strategies are not based on age. The SSA is not prepared to discuss these strategies. There are a lot of additional benefits hidden in these strategies.

10) Our research has shown that the difference between the highest and lowest options can reach $10,000 per year. Do not let your clients file for Social Security benefits without consulting an expert. Professional advisors must understand that options exist and insist that their clients explore their options before filing for benefits. The folks at the local SS offices are just “order takers”. Recipients must develop a plan before going down to the local office to apply. Please make sure that your clients understand that SS may be a joint lifetime benefit and that their decision regarding SS must be taken very seriously.

Marc Kiner is a CPA who is interested in educating accountants on the importance of the proper planning and understanding of Social Security benefits. His firm’s website is http://kinercpa.com/ and can be reached at mkiner@kinercpa.com

Compared to some prior years, Congress has made few tax changes this year. Following are highlights of changes and facts for the upcoming tax season.

Opening day for electronic filing. The IRS starts accepting returns for electronic filing on Jan. 17th.

Due Date of Return The end of tax season is April 17, 2012 for returns not on extension.

New Form 8949 and Schedule D All capital transactions will now be reported on the new Form 8949. Schedule D-1 is no longer used. Sales of securities in 2011 that were purchased in 2011 should have a basis on the 1099 from a broker. The preparer must indicate on Form 8949 if a basis was shown on 1099-B, not shown on 1099-B, or no 1099-B was issued. A separate form is required for each case.There is also a column to report an adjustment to basis/sales price and the reason for the adjustment. As of today the form does not show the gain or loss on each transaction. Instead columns for the total cost, sales price, and adjustments are transferred to schedule D.

Standard Mileage Rates were changed mid-year. From 01/01/2011 to 06/30/2011 the rate was 51 cents per mile; after 06/30/2011 it went up to 55 cents per mile. The rate for use of a vehicle to get medical care also changed in midyear. From 01/01/2011 through 06/30/2011 the rate is 19 cents a mile and is 23.5 cents a mile for the remainder of the year. The 2011 rate for use of a vehicle to do volunteer work for certain charitable organizations remains at 14 cents a mile.

Schedule SE For 2011, the FICA portion of SE tax is reduced from 12.4% to 10.4%. The Medicare (HI) portion of the SE tax remains 2.9%. As a result, the SE tax rate is reduced from 15.3% to 13.3%.

Net self-employment income is no longer reduced by the amount of the self-employed health insurance deduction.

Earned Income Credit Before 2011 preparers were required to complete Form 8867, Preparer’s EIC Checklist, and keep it in their records. Now this due diligence form must be submitted to the IRS. Paid preparers failing to meet their due diligence requirements on EITC claims face higher penalties for returns required to be filed after December 31, 2011. The United States-Korea Free Trade Implementation Act amended IRC section 6695(g) raising the amount to $500.

Alternative Minimum Tax The exemption amount has increased to $48,450 ($74,450 if married filing jointly or a qualifying widow(er); $37,225 if married filing separately).

New Form 8938 Taxpayers with foreign assets above certain thresholds may have to file this new form, Statement of Specified Foreign Financial Assets. Unmarried taxpayers living in the US need to file if the total value of specified foreign assets exceeds exceed $50,000 on the last day of the tax year or more than $75,000 at any time during the tax year. For married taxpayers living in the US the threshold is $100,000 on the last day of the tax year or more than $150,000 at any time during the tax year. The thresholds for filing are generally four times higher for taxpayers living outside the US.

PTIN’s All tax preparers need to have a PTIN. The fee for renewal is $63. CPA’s and enrolled agents are also required to have a PTIN although they are exempt from the competency tests which will be required.

Electronic Filing Requirements Starting Jan. 1, 2012, the 100-return threshold will be reduced to 11 or more income tax returns that the preparer, or the preparer’s firm in the aggregate, expect to file in 2012 for individuals, trusts and estates. In 2011 over 65 million returns were prepared professionally and about 90% of them were filed electronically.