Catherine Accounting & Tax Services LLC

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Catherine Accounting & Tax Services LLC Helping individuals & entrepreneurs with stress-free taxes, bookkeeping & IRS solutions.

Contractors: that equipment order isn't a deduction yet. Here's why.Thinking about a new truck, trailer, or machine befo...
10/26/2026

Contractors: that equipment order isn't a deduction yet. Here's why.

Thinking about a new truck, trailer, or machine before year-end? Good news first: for 2026, the Section 179 deduction limit is $2,560,000, and 100% bonus depreciation is now permanent for qualifying property.

But here's the part that trips people up: the deduction doesn't start when you order or even when you pay.

It starts when the equipment is placed in service.

That means delivered, installed if it needs it, and ready and available to use in your business by December 31, 2026.

Three things to keep straight:

1. It must be used more than 50% for business in the year you place it in service. Drop below that later, and you could face recapture.
2. Financing counts. Financed equipment can still qualify if your business is the tax owner and it's placed in service by year-end.
3. The clock is real. A machine sitting on a lot or a trailer in transit on December 31 is a 2027 deduction, not a 2026 one.

So if a purchase is on your list, the question isn't just "can we afford it". It's "will it be ready to use before December 31?"

And once you have the answer, make sure the purchase actually fits your year-end tax picture. That's where we come in.

At Catherine Accounting & Tax Services LLC, we help contractors and small business owners plan equipment purchases, depreciation, and estimated payments before the year closes, not scramble in April.

No accounting degree required on your end.

Book a year-end equipment and tax planning checkup: https://www.cattaxpro.com/contact.php

General information only; not individualized tax advice.

The "no tax on overtime" deduction is real. But on a lot of payrolls, it won't show up. Here's why. 👇For tax years 2025 ...
10/26/2026

The "no tax on overtime" deduction is real. But on a lot of payrolls, it won't show up. Here's why. 👇

For tax years 2025 through 2028, eligible workers can deduct qualified overtime pay from federal taxable income: up to $12,500 for single filers and $25,000 for married filing jointly. It starts phasing out above $150,000 of modified AGI single, or $300,000 joint.

Here's the part owners miss: the deduction only covers the overtime premium. That's the extra half above your regular rate, not every dollar paid at time and a half.

So the payroll has to separate it. If overtime is paid as one blended number, there's nothing to report, and your employees lose a deduction they may qualify for.

And starting with 2026, employers report qualified overtime compensation on Form W-2, box 12, code TT. The IRS has said the deduction generally depends on it being reported there. For contractors and construction crews running heavy overtime, that means the payroll setup done now decides what your people can claim in April.

Worth a look before year-end: is your payroll system splitting regular pay from the overtime premium, and are you tracking it by employee for the W-2?

We help contractors, construction and service businesses, and home health businesses with payroll support, bookkeeping and year-end tax planning.

Start here: https://www.cattaxpro.com/contact.php

General information only; not tax advice. Eligibility depends on your facts and current IRS rules.

Contractors: the diesel penalty relief ends December 31, 2026. Don't let it slip past you.Here's what changed. Under IR-...
10/23/2026

Contractors: the diesel penalty relief ends December 31, 2026. Don't let it slip past you.

Here's what changed. Under IR-2026-122, the IRS is not imposing penalties when dyed diesel fuel is sold for use or used on highways nationwide. The relief is retroactive to October 1, 2026 and runs through December 31, 2026. The agency also said it will not penalize related failures to make semimonthly deposits or keep records for that use.

So yes, running dyed fuel on the road right now will not trigger a federal excise penalty. Three things to keep straight, though:

1. It's federal only. State fuel taxes and state penalties are a separate matter, and states are not all handling this the same way. Check with Maryland before you assume anything carries over.
2. It's temporary. December 31 is a hard stop, and the IRS has said a grace period for residual red dye in tanks is still being worked out. Plan your fuel and your recordkeeping for January now, not in January.
3. Your other tax duties didn't go away. Form 720 is still required for any other excise liabilities, and your income tax, payroll and sales tax obligations were never part of this relief.

If your trucks and equipment run on diesel, this is exactly the kind of thing that should be handled with a calendar, not a guess. That's the offer this week: a year-end tax and compliance checkup. We sit down with you, run through your books, your payroll filings, your quarterly estimates and any excise or fuel exposure, and tell you what needs attention before December 31 and what can wait.

No accounting degree required on your end. Just bring the numbers.

Request your year-end checkup here: https://www.cattaxpro.com/contact.php

General information only; not individualized tax advice.

Self-employed? Your health insurance just became a tax planning problem.If you buy coverage on the Marketplace, you need...
10/22/2026

Self-employed? Your health insurance just became a tax planning problem.

If you buy coverage on the Marketplace, you need to know this before the year ends: the enhanced premium tax credits expired on January 1, 2026. The subsidy cliff is back.

What that means in plain English:

For 2026 coverage, the premium tax credit is generally limited to households between 100% and 400% of the federal poverty level. For a household of four, 400% is $128,600. Go over that line and you get no credit at all, not a smaller one. Zero.

The second change is easier to miss. Repayment caps on excess advance credit payments are gone. If your income comes in higher than what you estimated when you enrolled, you repay the full excess on your return, with no ceiling. That is why a good year can turn into a surprise balance due in April.

For business owners and independent professionals, income is not fixed. A strong Q4, a big contract, or an IRA-to-Roth conversion can push you past a threshold you never planned for.

Three things worth doing now:

🔹 Project your 2026 net income, not last year's number. Self-employment income is what drives your household income for the credit.
🔹 Check where you sit relative to the 400% line before December, while you still have room to adjust.
🔹 Reconcile what you received in advance. File Form 8962 with your return. Skipping it holds up the whole filing.

The good news: this is exactly the kind of thing that can be planned around instead of discovered in April. Timing income, retirement contributions, and estimated payments all move the needle when they happen before year-end.

If you want a second set of eyes on your 2026 income picture, reach out through our contact form: https://www.cattaxpro.com/contact.php

General information only; not individualized tax advice.

Contractors: a busy jobsite doesn’t always mean healthy cash flow.Rabbet’s 2025 Construction Payments Report estimates t...
10/21/2026

Contractors: a busy jobsite doesn’t always mean healthy cash flow.

Rabbet’s 2025 Construction Payments Report estimates that slow, inconsistent payments cost the U.S. construction industry $299 billion in 2025-about 14% of total project costs.

Revenue earned isn’t the same as cash collected. Delayed payments can squeeze cash flow, and books that aren’t up to date may hide what’s outstanding until it becomes urgent.

Three practical habits can help you see the real picture:
✓ Track job costs by project
✓ Reconcile progress billings with payments received
✓ Review who owes you every week

Organized books and consistent A/R follow-up help you spot the gap sooner and make more informed decisions.

Contractor? Reach out for a job-costing and cash-flow check-in: https://www.cattaxpro.com/contact.php

General information only; not tax advice.

Self-employed or earning income without enough tax withheld? You may need to make estimated tax payments.WHO GENERALLY N...
10/21/2026

Self-employed or earning income without enough tax withheld? You may need to make estimated tax payments.

WHO GENERALLY NEEDS TO PAY?
You may need to pay if you expect to owe at least $1,000 after withholding and refundable credits, and your withholding and credits will be less than the smaller of:
• 90% of your 2026 tax, or
• 100% of your 2025 tax, or 110% if your 2025 AGI was over $150,000 ($75,000 if married filing separately).

HOW TO ESTIMATE YOUR PAYMENT
1. Estimate your 2026 income, deductions, credits, and total tax, including self-employment tax.
2. Use the safe-harbor amounts above to estimate the required annual payment.
3. Account for withholding and payments already made, then pay installments on time. If your income varies during the year, a different installment calculation may apply.

Self-employment tax is generally 15.3% of 92.35% of net earnings. The 12.4% Social Security portion is subject to the 2026 wage base of $184,500.

2026 estimated tax due dates: April 15, June 15, September 15, 2026, and January 15, 2027. The next due date is January 15, 2027.

Skipping or underpaying an installment may result in a penalty based on how long the amount was unpaid. You may still owe a balance when you file.

Join the C.A.T.S. Skool community for more guidance:
https://www.skool.com/cats-academy-5137?c=c8f8b4b2d14b4aee983d553aa0655829&s=newest&fl=

For help with tax planning, contact us: https://www.cattaxpro.com/contact.php

General information only, not tax advice. Your situation may differ.

The 1099 reporting threshold just changed for the first time in decades.For tax years beginning after 2025, businesses g...
10/21/2026

The 1099 reporting threshold just changed for the first time in decades.

For tax years beginning after 2025, businesses generally must file Form 1099-NEC for any contractor paid $2,000 or more during the year, down from the old $600 threshold. Payments to the same recipient are added together, so several smaller invoices can still put a vendor over the line.

A few things to keep straight:

• The $2,000 threshold applies to payments made in aggregate to each recipient, not per payment.
• Payments subject to backup withholding must be reported no matter the amount.
• The threshold adjusts for inflation starting in 2027, so it will not stay at $2,000.
• Your contractors must still report 100% of their income. The threshold only changes what gets reported to the IRS on their behalf.

If you pay contractors, now is the time to review your vendor list and make sure you have a current W-9 on file for everyone, before the January filing rush.

Have questions about your 1099 obligations this year? Reach us through our contact form: https://www.cattaxpro.com/contact.php

General information only; not tax advice.

#1099

You did the work. The invoice is still unpaid. And now you’re spending time chasing payment instead of serving customers...
10/20/2026

You did the work. The invoice is still unpaid. And now you’re spending time chasing payment instead of serving customers or growing your business.

Late payments can squeeze payroll, materials, and growth plans, even when sales are strong. QuickBooks’ 2026 Small Business Late Payments Report found that 59% of small businesses with outstanding invoices reported invoices at least 30 days overdue.

A few practical steps can help you stay on top of what’s owed:
• Keep your bookkeeping organized
• Review your accounts receivable aging regularly
• Set a simple, consistent invoice follow-up routine

Want a clearer picture of your cash flow and unpaid invoices? Reach out for a cash flow/A/R check-in: https://www.cattaxpro.com/contact.php

Received an IRS notice or dealing with back taxes, an audit, payment plans, liens, or levies? Take a breath: getting cle...
10/20/2026

Received an IRS notice or dealing with back taxes, an audit, payment plans, liens, or levies? Take a breath: getting clear on your next steps can make the situation feel more manageable.

Catherine Accounting & Tax Services LLC supports individuals and businesses with IRS notices, tax resolution matters, audits, and payment-plan options. Every situation is different, and no outcome can be guaranteed.

Learn more in our C.A.T.S. Academy community: https://www.skool.com/cats-academy-5137?c=c8f8b4b2d14b4aee983d553aa0655829&s=newest&fl=

For help with your situation, contact us: https://www.cattaxpro.com/contact.php

General information only; not tax advice.

Business owners: the 20% QBI deduction is now permanent, but it isn’t automatic.Under 2025 legislation, the Section 199A...
10/19/2026

Business owners: the 20% QBI deduction is now permanent, but it isn’t automatic.

Under 2025 legislation, the Section 199A qualified business income (QBI) deduction was made permanent. Eligible owners of pass-through businesses may qualify to deduct up to 20% of qualified business income. “Up to” matters: eligibility and the amount depend on what income qualifies and rules that can involve your taxable income, business type, W-2 wages, qualified property, and other limits. S corporation shareholder wages are generally not QBI.

Year-end steps to take now:
✓ Reconcile your books and separate business and personal activity.
✓ Organize receipts and records supporting business income and expenses.
✓ Review profit, payroll, and asset purchases with your tax professional before making year-end decisions.

Clear records support better planning, but no deduction is guaranteed. Eligibility and limitations vary.

For general information only; this is not individualized tax advice.

Need help with bookkeeping or tax planning? Contact us: https://www.cattaxpro.com/contact.php

Join our community: https://www.skool.com/cats-academy-5137?c=c8f8b4b2d14b4aee983d553aa0655829&s=newest&fl=.

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Lanham, MD
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