New Electronic Tax Return Delivery

System

As part of our effort to create a better client experience and streamline the e-signing and tax delivery process, DDK will now be using SafeSend Returns. SafeSend is a secure and easy program that allows our clients to receive, review, and e-sign their tax returns from their computer, tablet, and smartphone.

Easy 5-Step Electronic Tax Return Delivery Process

  1. You will receive an email from noreply@safesendreturns.com. The DDK logo will appear in this email. 
  2. Click on the secure access link contained in the e-mail.
  3. Verify your identity by entering the last four digits of your Social Security number.
  4. Check your email for a unique Access Code. If you don’t see it in your inbox, check your spam or junk folders.
  5. Congratulations! You now have access to your tax return. SafeSend Returns will walk you through the review and e-signature process with step-by-step instructions.

Video Walkthroughs of the Delivery Process:

Individual Client Tax Return Help

 

Entity Client Tax Return Help

  

Common Questions About our Tax Delivery System

Q: Is it safe to enter part of my Social Security Number?

A: Yes. SafeSend Returns offers a secure system to view and sign your e-file authorization form(s). Look for https:// at the beginning of the site URL and a locked padlock symbol in your browser’s URL bar to confirm you are on the secure site.

Q: What if I don’t receive an email with my access code?

A: Check your spam/junk email folder. You can also search your email for noreply@safesendreturns.com.      Some email clients hide items they’ve labeled spam or junk, making certain emails difficult to find. If you do not receive your code within the 10-minute time limit, please request another code.

Q: Will this work on any internet-connected device? Does SafeSend Returns offer an app for my smartphone?

A: There is currently no SafeSend Returns app available, but the signature process can be completed on any computer, smartphone or tablet via a web browser.

Q: I’d rather print and sign my e-file authorization form(s). Can I do that?

A: Yes - You can still print, sign and mail your e-file form(s) back to DDK if you’d prefer to do so.

Q: Will I have to print and mail anything to the government?

A: The only items you may need to print and mail out to government authorities is the tax and estimate payment vouchers. If forms need to be printed and mailed, you will receive clear instructions. You will also be provided options to make tax payments electronically if you prefer not to mail payments.

Q: My Spouse and I are filing our return jointly – How can we both sign the e-file authorization form(s)?

A: There are a couple of options:

If both spouses have an email address on file, both will receive an email with a link to view the return and sign the e-file authorization form(s). First, one spouse will receive the link with identity verification questions specific to him/her. He or she will sign the e-file authorization form(s), and an email link will be sent to the second spouse. The second spouse will answer identity verification questions specific to him/her, then sign the form(s).

If only one spouse has an email address on file, that spouse will first receive the link with identity verification questions specific to him/her. He or she will sign the e-file authorization form(s) and then enter an email address for the second spouse. The second spouse will then receive the email link with identity verification questions specific to him/her. Once the second spouse electronically signs the e-file authorization form(s), DDK will be notified that signing is complete.

If a couple shares an email address, the primary signer will first receive a link with identity verification questions specific to him/her. After the primary signer signs the e-file authorization form(s), he/she can then enter the shared email address again. A new link will be sent with identity verification questions specific to the second spouse.

Q: Where do the identity verification questions come from? What if I don’t remember the answers?

A: The questions SafeSend Returns asks are knowledge-based questions pulled from government and credit sources. You may be asked questions such as where you lived in a given year, or when you bought your car or home. In the event the questions do not apply to you, simply choose the answer that accurately reflects this. If you don’t remember the answers to the questions, or you answer incorrectly, you won't be able to electronically sign your e-file authorization form(s). You can instead print, sign and return your e-file authorization form(s) to DDK.

Q: How is this process different from e-filing?

A: SafeSend Returns allows you to electronically sign your e-file authorization form(s), but it won't submit your return to the IRS. Once signed, DDK is automatically notified, and we will then complete the filing process for you, including submission to the IRS.

Q: Can I sign my dependent's individual return electronically?

A: DDK will deliver your dependent’s return using SafeSend Returns. However, some dependents may not have sufficient government and financial data available to successfully complete the electronic signature process. If there is not enough data available, your dependent will be given the option to download and sign their forms.

Q: Can I set up reminders for my quarterly estimated payment?

A: If estimated payments are included in your review copy, you will automatically receive an email reminder seven days before your payment is due.

Q: Will I receive a notification when my individual return is ready to sign?

A: Yes. Email notifications will be sent from DDK at noreply@safesendreturns.com. We recommend adding this email address to your safe list to prevent the email from getting filtered to spam/junk.

Q: After signing my individual e-file authorization form(s), will I receive confirmation that it was successfully submitted?

A: Yes, once you sign your e-file authorization form(s), you will receive an email stating it was successful. The email will also include a link to download a copy of your tax return for your records.

 Client Portal Login           Secure File Exchange
   SafeSend Returns
Blog

Self-employment tax: A refresher on how it works

If you own a growing, unincorporated small business, you may be concerned about high self-employment (SE) tax bills. The SE tax is how Social Security and Medicare taxes are collected from self-employed individuals like you.

SE tax basics

The maximum 15.3% SE tax rate hits the first $168,600 of your 2024 net SE income. The 15.3% rate is comprised of the 12.4% rate for the Social Security tax component plus the 2.9% rate for the Medicare tax component. For 2025, the maximum 15.3% SE tax rate will hit the first $176,100 of your net SE income.

Above those thresholds, the SE tax’s 12.4% Social Security tax component goes away, but the 2.9% Medicare tax component continues for all income.

How high can your SE tax bill go? Maybe a lot higher than you think. The real culprit is the 12.4% Social Security tax component of the SE tax, because the Social Security tax ceiling keeps getting higher every year.

To calculate your SE tax bill, take the taxable income from your self-employed activity or activities (usually from Schedule C of Form 1040) and multiply by 0.9235. The result is your net SE income. If it’s $168,600 or less for 2024, multiply the amount by 15.3% to get your SE tax. If the total is more than $168,600 for 2024, multiply $168,600 by 12.4% and the total amount by 2.9% and add the results. This is your SE tax.

Example: For 2024, you expect your sole proprietorship to generate net SE income of $200,000. Your SE tax bill will be $26,706 (12.4% × $168,600) + (2.9% × $200,000). That’s a lot!

Projected tax ceilings for 2026–2033

The current Social Security tax on your net SE income is expensive enough, but it will only worsen in future years. That’s because your business income will likely grow, and the Social Security tax ceiling will continue to increase based on annual inflation adjustments.

The latest Social Security Administration (SSA) projections (from May 2024) for the Social Security tax ceilings for 2026–2033 are:

  • 2026 – $181,800
  • 2027 – $188,100
  • 2028 – $195,900
  • 2029 – $204,000
  • 2030 – $213,600
  • 2031 – $222,900
  • 2032 – $232,500
  • 2033 – $242,700

Could these estimated ceilings get worse? Absolutely, because the SSA projections sometimes undershoot the actual final numbers. For instance, the 2025 ceiling was projected to be $174,900 just last May, but the final number turned out to be $176,100. But let’s say the projected numbers play out. If so, the 2033 SE tax hit on $242,700 of net SE income will be a whopping $37,133 (15.3% × $242,700).

Disconnect between tax ceiling and benefit increases

Don’t think that Social Security tax ceiling increases are linked to annual Social Security benefit increases. Common sense dictates that they should be connected, but they aren’t. For example, the 2024 Social Security tax ceiling is 5.24% higher than the 2023 ceiling, but benefits for Social Security recipients went up by only 3.2% in 2024 compared to 2023. The 2025 Social Security tax ceiling is 4.45% higher than the 2024 ceiling, but benefits are going up by only 2.5% for 2025 compared to 2024.

The reason is that different inflation measures are used for the two calculations. The increase in the Social Security tax ceiling is based on the increase in average wages, while the increase in benefits is based on a measure of general inflation.

S corporation strategy

While your SE tax bills can be high and will probably get even higher in future years, there may be potential ways to cut them to more manageable levels. For instance, you could start running your business as an S corporation. Then, you can pay yourself a reasonably modest salary while distributing most or all of the remaining corporate cash flow to yourself. That way, only your salary would be subject to Social Security and Medicare taxes. Contact us if you have questions or want more information about the SE tax and ways to manage it.

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