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In the News: CPAs Provide Gift Tax Guidance and Cyber-Security Tips

Shutterstock_124401508CPAs serve as trusted advisers and provide their clients with expert guidance on a variety of topics. It’s no surprise that they are frequently cited by the media for their expertise in areas such as tax, financial planning and even cyber security best practices. I’ve summarized a few recent examples of CPAs helping people make informed decisions about their financial lives.

Gift Tax

Everyone loves receiving presents, but sometimes those gifts can come with strings attached – from the IRS. Cari Weston, senior technical manager on the AICPA Tax Team, answered a Money Magazine reader who had a question about helping pay off an adult child’s debt. “Every year, you’re allowed to give another person up to the annual gift tax exclusion—this year $14,000—without reporting the transfer to the IRS or having to pay taxes on the sum,” Weston said.

 

For any gift above that limit, gift givers have to report the excess to the IRS through Form 709. That sum will be subtracted from their total lifetime gift and estate tax exclusion. Currently, Americans can transfer up to $5.43 million in assets federal-tax-free over their lifetime. Paying the full amount directly to the creditor will not help you get around the gift-tax limit, says Weston. No matter who the check is made out to, the IRS will still count it as a gift.

Cyber Security

Have you had your personal information compromised online recently? You aren’t alone. A new AICPA survey conducted by Harris Poll for National Financial Capability Month found that the number of Americans impacted by information security issues grew rapidly in the last year. AccountingWEB reports the survey found that one-in-four (25 percent) U.S. adults have been victimized by a breach in the past year – more than twice the number (11 percent) who had been impacted in a similar survey taken a year ago.

Not only do cyber-attacks put Americans’ information at risk, these breaches can have an adverse effect on consumers’ personal finances. According to the survey, one-in-five Americans (20 percent) said identity theft has negatively affected their credit score. Additionally, 26 percent reported that their credit score prevented them from doing at least one thing in the past year, including obtaining a personal loan, a credit card, or a mortgage.

AICPA’s National CPA Financial Literacy Commission offers the following useful tips for keeping financial information safe and protecting against personal information security breaches:

  • Avoid Shopping Using a Public Wi-Fi Connection. It’s generally a bad idea to transmit any personal data on a connection that isn’t secure – including those in coffee shops and public places.
  • Be proactive and reach out to your bank and credit card companies and ask what safeguards they have available, including fraud alerts and purchase limits.
  • Don’t click on links in unsolicited emails or social media sites, even if they purport to be from trustworthy retailers, because they may take you to sites that are trying to collect information for identity theft.

Have you seen any recent examples of CPAs sharing their expertise in the media? Share them in the comments section.

James Schiavone, Senior Manager - Public Relations, American Institute of CPAs.

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