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Message from Joyce Burchett

January 25, 2018

Dear Clients and Friends,

Hope your Holidays were great and delayed Happy New Year wishes!   We here at Burchett Financial Services are just following suit with Congress.  We delayed our newsletter until after the passage of the new tax reform bill “The Tax Cuts and Jobs Act.”  This reform primarily affects the 2018 tax returns until 2025 (or when it’s changed again).  We waited the whole year before we received anything and when it came, it was the largest piece of tax legislation in more than three decades.  The bill will affect the taxes of most taxpayers beginning in 2018. 

The bill is very complicated and brings up lots of questions and brainstorming possibilities as you go through it.  We are setting up brainstorming sessions just for this purpose.  We will have times available for group meetings up to 12-14 people to go through this or you can schedule a one-on-one consultation for this also. These sessions will be at an additional fee.  We’ll have some hand-outs dealing with the new tax reform available but regular appointment times do not provide us with enough time to do 2018 tax planning.  The new tax bill includes new tax tables which gives lower tax rates, 20% income reduction for pass-through businesses, higher standard deductions, no personal exemptions, changes on itemized deductions, elimination of unreimbursed employee business expenses, increased child tax credit and many more items.  So there will be more to come…. 

We at BFS have had some changes with our staff.  Of course I’m still sitting behind the desk as we speak and Lorraine and Kayla are still at the front line.  Lorraine says, “You can’t get rid of me so easily” and Kayla is a junior at UNCC.  Fran is joining us as a front liner and she is a Westie owner herself so she works for Westie hugs and kisses.  Ann thought she would retire – she will surely be missed!  After a major search, we found John to take her place.  He will be doing taxes, bookkeeping and payroll.  He just wants to fill up his free time from his 3 kids and spouse.  He will be available in the evenings and on Saturdays.

Unfortunately, all things have a season and people and dogs are in our lives for a reason and a season.  Cesar, who had exceeded all expectations of a life span, passed away Thanksgiving weekend.  He lived a long 17+ years and had a wonderful life.  He was the “main man” around here for 9 years and Riley and I truly miss him.  He was a real sweet boy and I don’t get those kisses everyday like before.  Riley was 11 years old in December and seems to be adjusting ok.  He missed playing with Cesar in the snow and I don’t run and roll down the hill anymore (LOL) – I can’t get back up!

As I’ve said going on 31 years (yes, this will be my 31st year doing taxes), you need to be prepared, organized and have your receipts.  We have experienced more “soft audits” or letters from the IRS and NC for any small thing that does not seem right or logical.  With all the budget cuts, physical audits are less that 1% (For 2016, audits fell to .7% which is 1 out of 143) but paper audits have increased.  Sometimes, it is a matter of one letter to resolve the issue and then there are 3 or 4 letters over a 2-3 year period.  It is time consuming and frustrating for all.  Remember, the government entities use their computers to automatically generate these letters and not physical people with brains and training.


Please have all your information ready before setting up your appointments.  We have included a checklist with this letter or you can go to our website to complete before coming in for an appointment.  If you can fill out all the new information before you come in, that will expedite your appointment time.  To set up an appointment, you can call the office at 704 549-9401 or send us an email at:   office.bfs@  Give us a date and time when you contact us.

The IRS will be going on-line or accepting returns on Monday, January 29, 2018.  Remember, those returns with Earned Income Tax Credits or additional child tax credit on Form 8812, your refunds will not be sent out until February 15, 2018.   This delay is being mandated by recent tax law changes because of the proliferation of identity theft and fraudulent tax returns using taxpayer information. This extra time will be used by the IRS to help prevent revenue loss due to theft.

If you are among the millions who have been impacted by IRS identity theft you will receive a PIN from the IRS in the mail by early January. It is a one-time use number that is needed on your form 1040 when you file your tax return. Without this number you will not be able to e-file your tax return.

You must have your Obama Care form 1095-A if you have health insurance through the marketplace. We must reconcile your subsidy on form 8962. If not completed, then it can hold up your refund, so go online and print out if you haven’t received by mail by January 31, 2018.

The days I will be at the Cornelius office at Safe Retirement Planners will be:  Thursday, February 22, 2018 and Wednesday, March 28, 2018.   Please call my office to schedule those appointments.

Don’t forget our referral program that runs from January 1- December 31. This is my way of saying “thank you” to our dedicated clients and friends who have referred us to friends and associates. For referrals of individual 1040 tax returns you will get a $20 discount and for business referrals it is $35. This is for any new client or business that begins within the year of 2018.

 As always I want to thank you for your continued business and support, and hope we can work together for many more years. I’m looking forward to seeing each of you this year and catching up and helping you with your financial and tax needs.  I am looking forward to a better year in 2018 and many positive things to happen in all our lives.



Joyce Burchett, EA
Burchett Financial Services






Again, it is extremely important for you to bring all the following to your appointment:

______All W-2’s, 1099’s and all other income items such as 1099 INT, 1099 DIV or 1099B (broker statements from investment companies).  If you sold stock, please provide cost basis or what you paid for the stock sold.  If a stock purchase plan, ask your company or broker what is the cost basis.

______Bring a prepared list of questions to ask during your appointment time.

______If you have refinanced, purchased or sold a home or any other properties during the year please bring all closing statements and refinance paperwork for each property.

______Don’t forget your itemized deductions including all medical expenses: doctors, dentists, eyeglasses, insurance premiums and all related medical expenses as well as your mileage.           

______All real estate taxes on your house and property, personal property taxes on all vehicles, boats, motor homes and motorcycles.

______Don’t forget your church contributions, cash & non-cash. Important reminder, you must have receipts for all contributions and all non-cash items must be itemized and an amount listed.  The item must be in good condition or it is not deductible. It is not necessary to bring the receipts; I only need to have the total amounts.  Political donations are not deductible as charity donations.

______Any business related expenses including purchase of tools and supplies, mileage that was not reimbursed or actual vehicle expenses. Was there a vehicle allowance given to you? Professional dues, continuing education, uniform cost and cleaning are deductible.

______ If you or your dependent had education expenses, then I will need the 1098-T to fill out the form for the education credits for this year. There will be more questions and compliance questions to be filled out on this year’s form 8863 and attached to the return. If not attached, there is a preparer penalty of $510 for each failure and I, of course, have no intention of paying any penalties.

______Remember to add all your receipts before coming in order to expedite the time involved in the tax preparation. It is not necessary to bring the receipts, bank statements or any back-up information to your appointment; I only need to have the totals per category.

______If you have a business (Sch.C or LLC). Please print out before you arrive for your appointment a profit & loss statement and a balance sheet. 

______Mailing, faxing, e-mailing or dropping off your tax return information is acceptable. I understand that gas is expensive and traffic is always bad, we want to be accommodating to you as much as possible. Please let us know when you are sending us the information and we will let you know when we receive it.  Please send in a PDF format and we can return your completed return in the same format for you to print and put together before mailing or for your copies.  There will be a fee to mail your returns back to you depending on the weight ($5 and up).

______Taxpayers who have foreign accounts totaling excess of $10,000 are required to file FBAR form 114 by April 15 instead of the old filing date of June 30th.

______Appointment times are scheduled every hour unless there is additional time required for your preparation. If you have unusual or difficult first time situations this year and you are not sure of what to bring, please call the office and discuss this before making your appointment. Some of these situations are: Can I claim an office in home, I sold a rental house, I sold my second home, I sold stock, I sold my primary residence, I bought a primary residence. It is a very costly proposition for you if we have to make additional appointments or if your appointment runs into the next clients scheduled time. You may be asked to reschedule and/or you will also be charged an additional sitting fee.

______With this being the fourth year for Obamacare and the extra time it takes, please let us know so that we can schedule you accordingly.  If you don’t have health insurance or you have insurance through the Marketplace, there are additional forms to fill out to make sure you got the correct subsidy or see if you were overpaid. If you have dependents who worked part time, we will need to know their income as well, so bring their W-2’s with you. We must have the form 1095-A from the Marketplace which has to be sent out by January 31 in order to complete your returns. You will also need the 1095-C from your employer letting us know what coverage you had and for what months. This area is very complicated and time consuming – extra time is needed to complete in one sitting.  Additional fees will now be charged for any re-dos.

______EXTREMELY IMPORTANT:   All tax returns and work prepared by my company and myself must be paid for when completed and picked-up. There will be no exceptions to this rule.  We will be accepting Debit and Credit cards this year as well as several main banks within walking distance of the office.  There will be a 5% processing fee assessed for all Debit and Credit card charges.

______In the past, we have mailed returns back with no additional charge but this has proved very costly.  Therefore, we will now be adding to the returns from $5 up to cover the additional expense.

______When your tax return is finished, you are given a copy for your files, and we can send the tax return to you in a PDF file for your records and printing as you deem necessary. If additional copies or faxes are necessary there is an additional $25 fee or $30 for larger or business returns. Before you call the office asking us to fax a copy of your return to someone or make you another copy, please look for your copy. I will need that request in writing along with the additional fee before I can make any copies, or fax or email any returns.

______If you have received letters from the IRS or NC throughout the year and you have not previously notified us please let us know. We ask that in the future you let us know as soon as they are received because most of these are time sensitive. You could lose your refund if you delay.  There could be additional fees for us handling these letters depending on the subject matter.

______Complete the update sheet and checklist before coming in for appointments or you can send back early. This will eliminate coming in early for our appointments.

______Organizers are available as a PDF file and will be sent to you in January. Please send an email requesting one or call the office. You can even send them back to us prior to your appointment to expedite your tax preparations.

______ If you will be needing to do an installed agreement to pay any balance dues, consider this, user fees are $43 for low-income and $225 for regular incomes. This is the privilege to pay the taxes due monthly while still incurring penalty and interest.




  • Medical expenses deduction is now at 7.5% of adjusted gross income. (The only retroactive change for 2017 from the new tax bill.)
  • Additional .9% Medicare tax on part of their wages and self employment income
    • Kicks in on singles wages exceeding $200,000 and couples wages exceeding $250,000. Self employed are also subject to the 0.9% surtax on earnings above the thresholds.
  • Additional 3.8% Medicare contribution tax on all or part their net investment income
  • IRA contributions will stay steady at $5,500 plus over 50 catch-up $1,000 for a total of $6500. This is for all kind of IRA (Traditional, Nondeductible, and Roth) into 2017
  • 2017’s limits will be $99,000 to $119,000 for couples and $62,000 to $72,000 for singles.
  • Maximum taxable payroll earnings for Social Security (wage base):  2018 - $130,000;
  • 2019 - $135,000; 2020 - $139,800; 2021 - $145,800  plus unlimited for Medicare
  • Cost of Living Adjustment (COLA) for Social Security recipients for 2018 is 2.1% hike vs .3% for 2017
  • Medicare Part B monthly premium $119.00 per month in 2018. Basic premiums for some people are $134.00.  Since 2000, Social Security benefits increased 43% while typical senior expenses as calculated by the Senior Citizens League’s annual buying guide have jumped 86%.
  • The 401K limit will rise to $18,500 for 2018 plus over 50 catch up is an additional $6,000. These contribution limits apply to 403B and 457 plans. The ceiling on Simples will rise to $13,000 and folks age 50 and over can put in $3,000 more. Contributions phase out at AGI slightly.
  • The maximum on the HSA will be $6,900 in 2018 for family coverage. Self coverage rises to $3,450.
  • IRS eases the use-it-or-lose-it rule for health flexible spending plans. Plans can allow employees to carry over up to $500. Employers must adopt the change
  • IRS is starting to have a heart. If you filed or paid late, there is a first time abate program that may waive any late payment and filing penalties.
  • The top rate on capital gains and dividends 20%, 0% and 15% are still in effect.
  • The standard mileage rate for business use for 2018 will be 54.5 cents. Medical and moving is at 18 cents and charity miles are still at 14 cents a mile.
  • The estate and gift tax exemption increased to $5,600,000 for 2018. The annual gift tax exclusion rises  to $15,000 per donee
  • Obamacare will continue to provide many people with refundable credits to help them buy health coverage. Form 8962 must be filled out to reconcile your advance subsidies to actual. You must have form 1095-A to complete the form and/or your refund can be delayed. So if an employee’s premium exceeds 8% of the household’s AGI then the penalty tax doesn’t apply. Members of households where total income is below the level needed to file a tax return also are exempted. Therefore, once the formula is done, I believe that most people will not be subject to the penalty tax because it will prove to be unaffordable for them.
  • In 2016 & 2017 the maximum fine for not having insurance is $695 a person or as much as 2.5% of your income, $2085 per uninsured families, unless we can find an exemption, such as unaffordable.  

No more penalty – does not start until 2019.  The Affordable Care Act (ACA) no-coverage penalties remain in place even though a presidential executive order asked the IRS to “minimize the unwarranted economic and regulatory burdens” of the ACA until Congress repeals it.  That repeal has yet to be made, so the penalties are still in place.

  • Some 2016 tax provisions expired 12/31/16 and have not been extended as of this writing.  Possibly they might be extended at a later date.  These include the tuition and fees deduction, the mortgage insurance premium deduction and the mortgage debt-forgiveness tax break enacted during the financial crisis to help homeowners.
  • Also Tax-deferred ABLE savings accounts for the disabled, similar to 529 plans. Starting in 2015, nondeductible pay-ins of up to $14,000 a year can be made to ABLEs for those who become blind or disabled before age 26. Payouts will be tax-free if used for housing, transportation, education, job training and the like.
  • Tax compliance and payroll taxes are a major area of fours for the IRS and Department of Justice. These are looking at companies skipping payroll tax deposits as well as the misclassified workers or independent contractors.
  • The 2015 individual audit rate was 0.84%, one in 119 returns. The 2016 audit rate fell to .7% out of 143.  These are the lowest figures in years. The bulk of these audits were correspondence/spam’s done by mail. The main individuals looked at were filers claiming the earned income tax credit- 1.75% was audited last year. Sole proprietors between 2%-2.5% of the schedule C filers reporting $25,000 gross receipts. Upper-incomers: Tax payers with income of $200,000 or higher had a 2.61%, or one in every 38 returns vs. .76% for those with lower incomes. Millionaires get the most scrutiny. 9.55% of tax returns reporting at least $1 million compared with 7.5% in prior year. Lucky super-rich with $10 million or more were audited at 34.69%. These are the people with 1040 and entities they control, such as C & S Corp, LLC, and partnerships. The business exam rate was 0.6% and partnerships and S-Corporations are feeling the heat.
  • As tax season begins, you will hear the same old stories, such as “bring gift cards to certain locations,” “student tax” scams, “pay $ now or go to jail,” and false CP2000 letters or tax bills by email/scams. Let me just tell you- the IRS will not call or email you. They do letters by computers. Computers generated pre-formed letters to tell you of any balance dues until you call and set up a payment agreement, pay them, and then they send certified letters. They can knock on your door if you continue to ignore them. Now, they have started the private debt collection next spring. These private collections can contact people by phone, which raises concerns, but they should say they are IRS contractors.
  • IRS continues to pay billions in erroneous claims for refundable tax credits and tax cheating, Treasury inspectors say. A whopping $458 billion fell through the cracks each year from 2008 to 2010, which is not paid voluntarily and timely. IRS will recoup $52 billion through audits and other enforcement activities leaving a net gap of $406 billion per year. Underreported business income from individuals is a big chunk of it ($125 billion in income tax plus $65 billion in S-E tax). The tax gap isn’t likely to get smaller anytime soon. With the limitations in the IRS budget they can’t hire the 600-700 agents needed to replace the $5000-plus agents lost since 2010 and the budget short falls.

Audit Red Flags – these can cause extra scrutiny

  1. Higher than average deductions
  2. Large charitable donation of a conservation or façade easement
  3. Rental losses, meals, travel, entertainment and alimony
  4. Small business on Schedule C
  5. 100% business use of a vehicle
  6. Multiple years of losses or activity looking like a hobby
  7. Day trading losses
  8. Foreign earned income exclusion

More info and further explanations can be obtained at Look for 1040 central or use a keyword for any topic. You can also go to our webpage ( and link to the IRS and NCDOR for more information.


Extended Tax Season Hours begin January 22, 2018
                              Monday-Friday 9:00 AM- 7:00 PM
                              Saturday            8:00 AM- 5:00 PM

The office will be closed from April 18-23rd for a little R&R

C-Corporate Tax Returns are due April 17th
   Individual Tax Returns are due April 17th

S-Corporations, Partnerships & LLC’s are due March 15, 2018
(*This is new and reversed from before, beginning last filing season*)






Download the Checklist for Printing (Word Doc)






TAXPAYER                                                                           ­SPOUSE

Full Name:  ________________________ ___________________________
SS#              _______________________ ____________________________
Date of Birth:  _____________________  ____________________________
Home Address:  ____________________________________________________________________
Home Phone:  _____________________             ___________________________
Work Phone:  _____________________              ___________________________
Cell Phone:     _____________________              ___________________________
  (Please check which phone number is the best to reach you during reg. business hours)

E-mail Address:_____________________   Other email:_________________________
                      (Please mark which e-mail we can send notices and newsletters to)

Do you want to have a refund, if any, Directly deposited at no fee?    (Yes)            (No)
Bank: ______________Routing#_________________ Account# _________________
Do you want to E-file your returns (at an additional $50 fee)?            (Yes)            (No)          -----------------------------------------------------------------------------------------------------------------
Desired Completion Date: __________________________________
Desired method of pick-up or mailing:_______________________________________________________
  (If you choose to have it mailed, we charge between $5-15 depending on the size and weight)

I understand that my desired pickup date will be the targeted completion time and when the return is completed and ready for pickup, the office will call/e-mail me and let me know of its completion.  Please do not call the office before that desired date.
I certify that I have reviewed and have completed the Reminder Checklist for completion of my tax return and that it is complete.

___________________________________        _________________________________
Burchett Financial Service Agent                                     Client

Dropped off and signed on: _____________    Log #______________



Who referred you?___________________________________________________________________
Dependent Information:

___Full Name                            ____SS#                     Date of Birth_____

  1.  _______________________________________________________M/F
  2.  _______________________________________________________M/F
  3. ________________________________________________________M/F

     (Write on back of page if needed)


Download and Print NEW CLIENT INFORMATION.docx



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