Dr. Sheri Thomas, CPA

09/03/2026

🚨 IRS DIRTY DOZEN TAX SCAMS FOR 2026 🚨

The IRS has released its annual “Dirty Dozen” list of tax scams and schemes taxpayers should watch for:

1️⃣ IRS impersonation emails and texts
Scammers send alarming messages containing suspicious links or QR codes designed to steal personal information.

2️⃣ AI-generated IRS phone scams
Criminals use artificial intelligence, voice imitation and spoofed caller ID to sound legitimate. The IRS generally contacts taxpayers by mail first and does not demand immediate payment or threaten arrest.

3️⃣ Fake charities
Scammers create fraudulent charities following disasters and tragedies. Always verify that an organization is legitimate before donating.

4️⃣ Misleading social media tax advice
Viral “tax hacks” may encourage taxpayers to claim credits or deductions they do not qualify for, resulting in audits, penalties or delayed refunds.

5️⃣ IRS Online Account identity theft
Criminals may pose as helpers while trying to obtain information needed to access a taxpayer’s IRS account. Create and access your account directly through IRS.gov.

6️⃣ Fake undistributed capital-gain claims
Scammers promote fabricated or inflated Form 2439 claims to generate improper refundable credits.

7️⃣ Bogus “Self-Employment Tax Credit” promotions
There is no broad tax credit available simply because someone is self-employed. The IRS is closely reviewing questionable claims promoted online.

8️⃣ Ghost tax preparers
Avoid preparers who refuse to sign the return or include their PTIN. Never sign a blank or incomplete tax return.

9️⃣ Inflated noncash charitable deductions
Promoters may encourage exaggerated values for donated art, conservation easements or other property to improperly reduce taxes.

🔟 Fabricated withholding
Scammers encourage taxpayers to report withholding that was never paid to create a larger refund. The IRS verifies withholding against information reported by employers and financial institutions.

1️⃣1️⃣ Spear-phishing attacks targeting tax professionals
Fraudulent “new client” emails and document-sharing requests may contain malicious links or attachments designed to steal taxpayer information.

1️⃣2️⃣ Offer in Compromise mills
Aggressive companies may charge large fees while promising tax-debt settlements to people who do not qualify. Eligibility can be checked directly through the IRS.
Protect yourself:

✅ Do not click unexpected links or attachments.
✅ Hang up on threatening or suspicious callers.
✅ Verify information directly through IRS.gov.
✅ Use a reputable tax professional.
✅ Report suspicious IRS-related messages to [email protected].

Remember: If a tax strategy sounds too good to be true, it probably is. Taxpayers remain legally responsible for the information reported on their returns.

09/01/2026

Educator Classroom Expense Deduction – Did You Know?

Eligible K-12 teachers, instructors, counselors, principals and aides who pay for classroom supplies out of pocket may deduct up to $350 of qualifying expenses per year. Married couples filing jointly who are both eligible educators may deduct up to $350 each, for a combined maximum of $700.

You do not need to itemize deductions to claim this deduction. Be sure to keep receipts and other records for any classroom expenses you plan to deduct.

08/30/2026

📘 New Business Owner’s Financial Survival Guide

Starting a business is exciting—but managing the financial and tax responsibilities can quickly become overwhelming.

I created the New Business Owner’s Financial Survival Guide to help new and aspiring business owners understand the financial basics they need to build a strong foundation.

This practical, easy-to-understand guide covers:

✅ Choosing a business structure
✅ Obtaining an EIN
✅ Separating business and personal finances
✅ Establishing an effective bookkeeping system
✅ Understanding self-employment and estimated taxes
✅ Tracking and categorizing business expenses
✅ Preparing for Schedule C and tax filing
✅ Following monthly and year-end financial checklists

You don’t need an accounting degree to manage your business finances—but you do need a reliable system and a clear understanding of your responsibilities.

Get your downloadable copy here:

https://sherithomascpa.gumroad.com/l/newbusinessguide

Stop Guessing. Start Building.Most new business owners don't fail because they worked too hard — they fail because nobody told them the financial rules before they broke them.The New Business Owner's Financial Survival Guide is a step-by-step roadmap written by a CPA with 25+ years of experience h...

08/24/2026

Major Higher Education Tax Credits Now Require Valid SSN – Did You Know?

The American Opportunity Tax Credit (AOTC) and Lifetime Learning Credit (LLC) help many Americans pay for higher education. For eligible students pursuing a degree or other recognized credential, the AOTC can cover up to $2,500 in tuition, required school fees and certain course materials per year. Meanwhile, the LLC can offset up to $2,000 per tax return for qualified education expenses for eligible students taking higher education courses for a variety of reasons.

Beginning with tax year 2026, the taxpayer claiming either the AOTC or LLC (and spouse, if filing jointly) must have a Social Security number (SSN) valid for work in the United States that was issued before the due date of the tax return, including extensions. If the eligible student is not the person claiming the credit (for example, if the student is that person's dependent or spouse), then the student must also have a valid SSN issued by that deadline. Other qualification requirements, such as income limits, remain in effect. A tax professional can help you determine whether the higher education expenses you pay for yourself, your spouse or a dependent qualify for a tax benefit.

08/18/2026

🚨 IRS FOCUS ON S CORPORATION REASONABLE COMPENSATION 🚨

The IRS is moving toward adding an artificial intelligence overlay to its legacy computer systems. 🤖

One area expected to receive increased attention during the next 12–18 months is reasonable compensation for S corporation shareholder-employees. Letters may be sent when an S corporation return reports shareholder distributions but little or no officer compensation. 📬

This is an important reminder that shareholder-employees generally must receive reasonable compensation for the services they perform before taking non-wage distributions. S corporation owners should review compensation annually and maintain documentation supporting how the amount was determined. 📋✅

08/18/2026

Seasonal Employers - Did You Know?

Summer is a peak time for many businesses to hire seasonal employees. In general, the same federal tax rules apply to these workers as to permanent staff. Employers typically must withhold federal income tax and F**A (Social Security and Medicare) taxes and pay the employer share of F**A. Employers subject to FUTA must also pay federal unemployment tax on taxable wages.

Seasonal employers often must file Form 941 (Employer's Quarterly Federal Tax Return) for quarters in which they pay wages. However, they generally do not need to file for quarters in which they paid no wages and have no employment tax liability. If this applies, check the "Seasonal Employer" box on every Form 941 you file.

Employment taxes generally must be deposited monthly or semiweekly, based on the applicable lookback period. FUTA follows separate deposit rules and generally must be deposited when accumulated FUTA tax exceeds $500 for a quarter. Federal tax deposits must be made electronically, including through EFTPS.

08/13/2026

📢 IRS INSTALLMENT AGREEMENT CHANGES

The IRS has revised its procedures for certain installment agreements, now called Simple Payment Plans.

For qualifying individuals and certain businesses owing $50,000 or less:

✅ The former 72-month repayment requirement has been removed.

✅ The monthly payment may be calculated to pay the debt in full by the Collection Statute Expiration Date. This could allow up to approximately 10 years, depending on how much time remains.

✅ A detailed financial statement is generally not required.

✅ Direct debit or payroll deduction is not mandatory.

✅ The IRS is not automatically required to file a Notice of Federal Tax Lien, although it may still do so when necessary to protect the government’s interest.

Similar provisions are available for qualifying businesses with trust-fund tax liabilities of $25,000 or less. The former 24-month repayment requirement has been removed, allowing the balance to be paid by the collection deadline if all requirements are met.

Taxpayers must have filed all required returns and must remain current with estimated tax payments, withholding, and federal tax deposits. Penalties and interest continue to accrue until the balance is paid.

08/11/2026

Expense Deduction Rules for Personal Property Used for Business – Did You Know?

Many self-employed people may qualify to reduce their taxable income by deducting business expenses. In general, you must allocate expenses related to mixed-use property based on your "percentage of business use." But how is this percentage calculated?

For many types of equipment, your business use percentage may be based on a reasonable measure such as time or output. For example, if you use your computer for 30 hours a week in your freelance work and 20 hours a week for personal purposes (total of 50 hours), then your business use percentage would generally be 30/50 = 60%. Meanwhile, if you have a printer and print 400 pages for business reasons and 100 pages for personal reasons (500 pages total), then your business use percentage would typically be 400/500 = 80%. Therefore, you could generally allocate 80% of shared costs like ink and paper to business use.

On the other hand, business percentages for vehicles should be based on mileage, not time. So if you drive your car 4,500 miles this year in the course of your self-employment work, and 10,500 miles for all other purposes (total of 15,000 miles), then your business use percentage would be 4,500/15,000 = 30%. Alternatively, if eligible, you may choose to use the standard mileage rate and calculate your vehicle deduction based on your qualifying business miles instead of deducting your share of actual vehicle expenses. Be sure to keep records that support your business use percentage, such as mileage logs, usage records, or other documentation showing how the property was used for business and personal purposes.

08/03/2026

New IRS Automatic Exemption from Penalty Program

Beginning in summer 2026, the IRS is implementing a new system that will waive certain failure-to-file, failure-to-pay and failure-to-deposit penalties for eligible taxpayers with a strong compliance history. To qualify for the Automatic Exemption from Penalty (AEP) program, a taxpayer generally must have met all filing and payment deadlines for the previous three years, or 12 consecutive quarters for quarterly filers.

Unlike First Time Abate, eligible taxpayers will not need to request AEP relief. The IRS will apply it automatically and send a notice. For eligible returns due on or after January 1, 2027, AEP will replace First Time Abate, although reasonable-cause relief will remain available.

Not all IRS penalties qualify for automatic relief. For example, information-return penalties and accuracy-related penalties generally will not qualify. AEP applies only to eligible penalties, not to the underlying tax or interest due.

07/27/2026

Charitable Cash Donation Deductions

Historically, only people who itemized deductions on their tax returns could deduct contributions to charities. However, beginning this year, taxpayers may now qualify to deduct up to $1,000 in cash donations (up to $2,000 for joint filers), regardless of whether they itemize or use a standard deduction.

Only contributions to qualified, tax-exempt charitable organizations (not individuals) are deductible. You can check the official IRS list of tax-exempt charities (link below) to verify an organization's eligibility to receive tax-deductible donations. For monetary contributions, save bank records, canceled checks and/or receipts showing each organization's name, along with the date and amount of each donation. The IRS requires a written acknowledgement from the charity for each individual contribution of $250 or more, showing both the donation amount and the value of anything you receive in return (such as tee shirts, totes, etc.).

You still need to itemize in order to deduct contributions of property, and must have detailed records showing how you determined reasonable dollar values for the donations. For valuable items like collectibles or artwork, you may need a professional appraisal.

Tax Exempt Organization Search: https://www.irs.gov/charities-non-profits/search-for-tax-exempt-organizations