Tax problem solver

Tax problem solver You can forget about your back taxes, but the IRS will not. We help you put this problem to rest for

08/16/2023

Looking through a tax return can be a daunting process. Here is a simple process to help you confirm the information and identify areas of possible error or need of clarification.

If you play a major role in a closely held corporation, you may sometimes spend money on corporate expenses personally. ...
07/18/2023

If you play a major role in a closely held corporation, you may sometimes spend money on corporate expenses personally. In general, you can’t deduct an expense you incur on behalf of your corporation even if it’s a legitimate business expense. That’s because you can only deduct expenses that are your own and the corporation is a separate legal entity. And the corporation won’t generally be able to deduct them either because it didn’t pay them. One solution is to arrange to have the corporation reimburse you for expenses you incur. Turn the receipts over to the corporation and use an expense reimbursement claim form or system. Then, the corporation can deduct the reimbursement amount.

07/18/2023

The worst time to know about new tax laws is when it is too late to do anything about it. Here is a summary of the most impactful changes this year.

If you own an unincorporated small business, you know your self-employment (SE) tax bills are high. In 2023, SE tax is i...
07/15/2023

If you own an unincorporated small business, you know your self-employment (SE) tax bills are high. In 2023, SE tax is imposed at a rate of 15.3% on the first $160,200 of net SE income. This includes 12.4% for Social Security tax and 2.9% for Medicare tax. Above $160,200, Medicare tax continues at a 2.9% rate on all income before increasing to 3.8% at higher income levels due to the 0.9% additional Medicare tax. In some circumstances, you may want to become an S corp. to save on employment taxes You can then pay modest, but justifiable, salaries to shareholder-employees and pay out most or all remaining corporate cash flow in federal-employment-tax-free shareholder distributions.

“Thousands of people have lost millions of dollars and their personal information to tax scams,” according to the IRS. T...
07/13/2023

“Thousands of people have lost millions of dollars and their personal information to tax scams,” according to the IRS. The scams may come in through email, text messages, telephone calls or regular mail. Criminals regularly target both individuals and businesses and often prey on the elderly. Important: The IRS will never contact you by email, text or social media channels about a tax bill or refund. Most IRS contacts are first made through regular mail. Be on guard for any suspicious messages. Don’t open attachments or click on links. Contact us if you get an email about a tax return we prepared. You can also report suspicious emails that claim to come from the IRS at [email protected].

One way that construction companies can mitigate supply-chain problems is to maintain their own inventories. However, an...
07/11/2023

One way that construction companies can mitigate supply-chain problems is to maintain their own inventories. However, an inventory may complicate tax planning. Here are three big issues to consider: 1) Valuation; the value of inventory is a factor in the calculation of cost of goods sold, which helps determine taxable income. 2) Shrinkage; this is the loss of inventory because of damage, fraud, theft or other factors. The IRS expects businesses to track inventory shrinkage and adjust their records accordingly. 3) State and local taxes; states and municipalities may impose their own taxes on inventory, which usually fall under property taxes. Contact us for assistance and more information.

Government officials saw a large increase in the number of new businesses launched during the COVID-19 pandemic. And the...
07/07/2023

Government officials saw a large increase in the number of new businesses launched during the COVID-19 pandemic. And the U.S. Census Bureau reports that business applications are still increasing slightly (up 0.4% from April 2023 to May 2023). Entrepreneurs often don’t know that many start-up expenses can’t be currently deducted. Some likely have to be amortized over time. You might be able to elect to deduct up to $5,000 currently, but the deduction is reduced by the amount by which your total start-up costs exceed $50,000. You can also deduct $5,000 of the organizational costs of creating a corporation or partnership. Contact us if you have tax questions about a start-up business.

The IRS recently released audit statistics for fiscal year 2022 and few taxpayers had their returns examined. Overall, j...
07/04/2023

The IRS recently released audit statistics for fiscal year 2022 and few taxpayers had their returns examined. Overall, just 0.49% of individual returns were audited. Historically, this is very low. However, even though a small percentage of returns are being audited these days, that will be little consolation if yours is one of them. Plus, the Biden administration has made it a priority to go after high-income taxpayers who don’t pay what they owe. The best way to survive an IRS audit is to prepare. On an ongoing basis, maintain documentation (invoices, bills, canceled checks, receipts, etc.) for items reported on your returns. Contact us if you receive an IRS audit letter.

07/04/2023

With all the complexity in the tax code, it is easy to make a mistake. Here are some common ones, and what you can do to eliminate the possibility of them happening to you.

Construction business owners are often urged to buy the latest software. But no such tool is perfect. At some point, you...
06/27/2023

Construction business owners are often urged to buy the latest software. But no such tool is perfect. At some point, you might think about investing in your own customized solution. If so, here are five factors to consider: 1) Budget and time; custom software won’t be cheap, and you’ll need to work closely with the developer. 2) Specialized needs; the product should solve issues specific to your company. 3) Integration; it should “play well” with your existing systems. 4) User support; consider the costs and challenges of supporting the software once it’s live. 5) Return on investment; in the long run, the solution must be worth more than the dollars you spend on it.

Here are a few key tax-related deadlines for businesses and other employers during the third quarter of 2023. JULY 31: R...
06/23/2023

Here are a few key tax-related deadlines for businesses and other employers during the third quarter of 2023. JULY 31: Report income tax withholding and F**A taxes for Quarter 2 of 2023 (unless eligible for an Aug. 10 deadline). File a 2022 calendar-year retirement plan report or request an extension. SEPT. 15: If you operate a calendar-year partnership or S corp. that filed an extension, file a 2022 income tax return and pay any tax, interest and penalties due. SEPT. 15: If a calendar-year C corp., pay third installment of 2023 estimated income taxes. Contact us for more about the filing requirements and to ensure you meet all applicable deadlines.

If you’re age 65 and older and have basic Medicare insurance, you may need to pay additional premiums to get the level o...
06/20/2023

If you’re age 65 and older and have basic Medicare insurance, you may need to pay additional premiums to get the level of coverage you want. The premiums can be costly, especially for married couples with both spouses paying them. But there may be an advantage: You may qualify for a tax break for paying the premiums. However, it can be difficult to qualify to claim medical expenses on your tax return. For 2023, you can deduct medical expenses only if you itemize deductions and only to the extent that total qualifying expenses exceeded 7.5% of adjusted gross income. We can determine whether you should claim the standard deduction or claim medical expense deductions on your tax return.

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