Service charge reporting deadline postponed
Tuesday, December 18th, 2012
The Internal Revenue Service has given businesses an extra year to comply with new rules on how to treat service charges, until January 1, 2014. The new rules had been scheduled to take effect January 1, 2013, but the deadline was extended in response to public comments to allow companies time to make their accounting […]
Read More »Two new taxes in 2013
Wednesday, December 12th, 2012
Two new taxes are scheduled to take effect in January 2013. These taxes were instituted by the Affordable Care Act to help pay for health care reform. Congress may change these taxes as they negotiate ahead of the tax rate and sequestration deadlines at the end of 2012 – the so-called “fiscal cliff”. Few politicians […]
Read More »What's a 1099-K?
Friday, February 3rd, 2012
Have you received a 1099-K this year? This new form reports electronic financial transactions. If your business takes debit or credit card payments, then you will receive a 1099-K if you process more than $20,000 AND more than 200 transactions. Business tax returns contain a new line to report 1099-K amounts. For this tax season […]
Read More »Payroll tax cut extension with a lump of coal
Thursday, January 5th, 2012
Congress extended the payroll tax cut for sixty days after weeks of posturing. The 2% reduction in Social Security tax withholding will continue to put a little extra money in employees’ pockets through the end of February 2012, but Congress threw in a lump of coal with its Christmas gift. If you earn too much […]
Read More »Offshore voluntary disclosure deadline
Tuesday, August 9th, 2011
The deadline in the IRS Offshore Voluntary Disclosure Initiative is August 31. For several years, the IRS has required taxpayers to disclose their accounts and income from foreign countries. The 2011 program offers taxpayers penalty reductions if they voluntarily disclose their offshore holdings and income rather than waiting for the IRS to find them. The […]
Read More »Minimize capital gains tax
Thursday, March 31st, 2011
When you sell an asset for more than your investment in it, the IRS says you must pay tax on the difference, called capital gain. For some years, the tax rate on such gains has been lower than regular rates if the asset is held for a long term (currently, more than one year). Hence […]
Read More »What's taxable? Prizes
Wednesday, March 16th, 2011
What’s taxable? According to the IRS, all receipts from all sources in any form, unless specifically excluded from taxation. Did you win the lottery? Taxable, although you can deduct the cost of the lottery tickets you bought (you saved them as proof, right?) Did you win a TV in a giveaway? Taxable. ‘Tax-exempt’ interest income? […]
Read More »Avoid 1099 requirement
Thursday, February 10th, 2011
The new credit card reporting rule has created a potential money-saving opportunity for businesses subject to 1099 reporting. Everyone engaged in a trade or business (including landlords beginning in 2011) must report payments of $600 or more to non-corporate service providers on Form 1099 to the payees and the IRS. Beginning January 1, 2011, banks […]
Read More »Renting to relatives
Monday, June 28th, 2010
Renting property to your relatives can be a good thing. You know them, and you probably have a good idea of how they will take care of the property. You may consider renting to your retired parents or to your children attending college. You must play by IRS rules to retain the tax advantages of […]
Read More »1099 Traps
Monday, March 1st, 2010
The IRS computer-matches Forms 1099 with your tax return, so it’s important that you gather 1099’s from all sources and report them on your return even if they contain errors. There are ways to correct errors, but if the computers cannot match the numbers in the first place, they will automatically generate tax-due notices that […]
Read More »