Month: May 2021

How Renovating a Historic Building Can Put Money in Your Pocket

The federal Rehabilitation Tax Credit, or rehab credit, offers significant financial incentives for owners or leaseholders of historic buildings to renovate those structures.1

What’s the big deal? Why are tax credits so exciting?

Tax credits, unlike deductions, reduce your tax bill dollar-for-dollar. If you spend $100,000 and get a 20 percent tax credit, you reduce your tax bill by $20,000. That’s Uncle Sam putting $20,000 in your pocket. And there’s more.

Read more

Deduct 100% of Your Employee Recreation and Parties

You take Bill, your best customer, to the local country club and treat him to 18 holes of golf. The golf produces a zero deduction.

Compare this.

You take your employees and their spouses and children to the local country club, where they play golf and tennis; swim; and enjoy lunch, dinner, and snacks.

The cost of the country club meals and activity produces a 100 percent tax deduction.1

In this article, you will learn the following:

  • What it takes to qualify an employee party for the 100 percent deduction
  • What types of employee entertainment qualify for this 100 percent deduction
  • How tax law defines entertainment that’s primarily for the benefit of employees

Read more

COVID-19: Significant Payroll and Self-Employment Tax Relief

If you are in business for yourself—say, as a corporation or self-employed—payroll taxes and self-employment taxes are likely two of your biggest tax burdens.

Due to the COVID-19 pandemic, individuals and businesses are suffering. Congress wants to help you individually and also keep small businesses afloat.

To do this, Congress decided that in addition to other measures, it should give you payroll tax and self-employment tax relief, as we describe in this article.

We’ll tell you how the Families First Coronavirus Response Act (FFCRA) and the Coronavirus Aid, Relief, and Economic Security (CARES) Act will give you payroll and self-employment tax relief.

Read more

Are Taxes Two-Timing You? How to avoid dual-taxation…

The shift to remote working during the COVID-19 pandemic has been embraced by both employees and employers. This change will likely continue to varying degrees by many companies.

Although remote working offers great benefits, employees need to know about the possible tax consequences and how to navigate them.

Read more

Self-Employed During the Pandemic? Washington Did Not Forget You

You report your business income as self-employed on Schedule C of your Form 1040 if you

  • receive 1099 income,
  • operate your business as a single-member LLC and did not elect corporate status,
  • operate a retail establishment or professional practice as a sole proprietor, or
  • report your W-2 income on a Schedule C because you are a statutory employee.

In the past, when times were bad, your government made no special effort to help you as a self-employed individual. For example, you had no “safety net” such as existed for employees who lost their jobs. You were just supposed to suck it up until things got better.

But this time, with COVID-19, it’s different.

Read more

Beat the Unfair $10,000 SALT Cap with a C Corporation

C corporations cause double taxation for business owners, so you probably think you want to avoid them at all costs.

And for many of you, this is true, as the S corporation often provides the lower overall tax outcome.

But for some of you, the C corporation could provide the best tax outcome, especially since you can bypass the $10,000 state and local tax (SALT) deduction cap, which was introduced by the Tax Cuts and Jobs Act (TCJA), with a C corporation.

Read more

Saving for Education: Understanding 529 Plans

Many parents are looking for ways to save for their child’s education, and a 529 Plan is an excellent way to do so. Even better is that thanks to the passage of tax reform legislation in 2017, 529 plans are now available to parents wishing to save for their child’s K-12 education as well as college (two and four-year programs) or vocational school.

Read more