Sterling Tax & Accounting

05/14/2026

🚴 Congress has officially ended the federal tax break for bicycle commuting.

The OBBBA delivered the final blow by permanently eliminating the qualified bicycle commuting reimbursement. 💥

Originally created in 2009, the benefit allowed employers to reimburse employees for:
🔧 Bicycle repairs
🚲 Purchases & improvements
🅿️ Bicycle storage

Employees could exclude those reimbursements from income and payroll taxes, while employers deducted the cost.

Sounds great… but the benefit was always limited:
❌ Only pedal-powered bikes qualified
❌ No e-bikes or bike-share programs
❌ Could not be combined with transit or parking benefits
❌ Capped at just $20 per month ($240 annually)

The Tax Cuts and Jobs Act weakened the incentive in 2017 by making reimbursements taxable to employees from 2018–2025. Employers could still deduct the payments, however.

Now OBBBA finishes the job. Starting in 2026:
⚠️ Bicycle commuting reimbursements become taxable wages
⚠️ Employers lose the deduction entirely
⚠️ The result is a rare “double-tax” treatment

Meanwhile, Congress preserved much larger transportation benefits 🚉🚗
Tax-free transit passes and parking benefits remain available up to $340 per month in 2026.

A small benefit with a symbolic purpose has officially ridden into the sunset. 🌅🚲

05/12/2026

💼 Family relationships and overlapping ownership can quietly destroy otherwise solid tax planning strategies.

One of the biggest hidden traps? 👉 IRC Section 267.

This rule doesn’t come with flashing warning signs. Instead, it quietly:
❌ Disallows losses
❌ Delays deductions
❌ Eliminates tax benefits after the deal is already done

Section 267 applies to transactions between related parties — and the IRS cares more about who is involved than whether the deal was fair.

📌 Sell stock to a sibling at a loss?
That deduction may disappear entirely.

📌 Accrual-basis taxpayer owing expenses to a related cash-basis party?
You may not deduct the expense until the other party recognizes the income.

The real danger lies in the attribution rules 👀
Ownership can be attributed through:
👨‍👩‍👧 Family members
🏢 Corporations
🤝 Partnerships
📑 Trusts

A transaction that looks unrelated can suddenly trigger related-party treatment once ownership crosses the 50% threshold.

✅ Smart planning means identifying related parties before acting.
✅ Review ownership structures carefully.
✅ Coordinate timing of deductions and income recognition.
✅ Consider unrelated buyers for loss assets.

Section 267 rewards foresight — and punishes assumptions. ⚖️

05/07/2026

💼 Small Business Owners: Don’t Leave Money on the Table

Tax season doesn’t have to feel like a guessing game. There are more deductions available than you might think—and taking advantage of them can make a real difference in your bottom line.

Here are some key areas to keep on your radar:

🛫 Travel expenses – Flights, hotels, meals, and more
🚗 Vehicle costs – Mileage, gas, maintenance
💻 Equipment & supplies – Tech, furniture, software
🏠 Home office – Rent, utilities, workspace costs
📚 Education & training – Courses, seminars, certifications
💼 Health insurance – Premiums for the self-employed
💰 Retirement contributions – IRAs, solo 401(k)s
📝 Legal & professional fees – Accounting, legal support

✨ Bottom line: If it helps you run your business, it might be deductible—but proper tracking is key.

You’ve worked hard for your income. Smart tax planning helps you keep more of it.

05/05/2026

💡 Young Adults: Your Future Self Will Thank You

If you’re early in your career, now is one of the most powerful times to start building wealth—and an IRA can be a game changer.

⏳ With contribution deadlines approaching, here’s what you should know:

🔹 Traditional IRA
• Potential tax deduction today
• Pay taxes when you withdraw later
• Great if you want immediate tax relief

🔹 Roth IRA
• No upfront deduction
• Tax-free growth + withdrawals in retirement
• More flexibility (and no required withdrawals!)

📊 Contribution limits:
• 2023: Up to $6,500
• 2024: Up to $7,000

🤔 How to choose?
Think about your current vs. future tax bracket. If you expect to earn more later, a Roth IRA could be especially valuable.

🚀 The real secret: START EARLY

Even small contributions today can grow significantly over time thanks to compounding.

Your future isn’t built overnight—but it does start with one smart move.

04/09/2026

🚨 This One Mistake Can Make Your “Tax-Free” QCD… Fully Taxable 🚨

If you’re using Qualified Charitable Distributions (QCDs) from your IRA, this is critical 👇

QCDs are a powerful strategy:
✔️ Satisfy your RMD
✔️ Avoid income tax
✔️ Lower your AGI (and potentially Medicare premiums + Social Security taxes)

BUT… one small misstep can undo it all.

⚠️ The #1 mistake:
Receiving anything of value in return.

Even something small can trigger a big tax problem:
👉 Example:
You donate $5,000 via QCD
You receive a $250 charity dinner ticket
❌ The IRS may treat the entire $5,000 as taxable income

💡 Why?
Because of the strict “no-benefit rule.”

To stay compliant:
• Funds must go directly from your IRA to a qualified 501(c)(3)
• NOT to donor-advised funds
• You must receive nothing of value (with very limited exceptions)

📝 Watch out for:
• Charity event tickets
• Gifts or perks listed in acknowledgment letters
• Anything beyond “token” items

✅ Safe exceptions (generally):
• Low-value items (under ~$139 in 2026)
• Intangible religious benefits

📌 Bottom line:
QCDs are incredibly tax-efficient — but only if you follow the rules perfectly.

Before making a donation, double-check:
👉 “Am I receiving anything in return?”

That one question can save you thousands in taxes.

04/07/2026

🚨 BIG TAX WIN FOR EMPLOYERS IN 2026 🚨

The One Big Beautiful Bill Act (OBBBA) just supercharged the Employer Childcare Credit — turning what used to be a small perk into a major tax strategy 💡

Here’s what you need to know 👇

👶 What qualifies?
You can now claim credits for:
• On-site childcare facilities
• Partnering with daycare centers or preschools
• Third-party childcare platforms
• Childcare referral services

👉 And no — you don’t need to own a facility to qualify.

💰 The new numbers (starting 2026):
• Small businesses (< $32M revenue):
→ 50% credit up to $600,000
• Larger businesses:
→ 40% credit up to $500,000

📈 That’s up to 4X larger than previous years.

🤝 Game-changing update for small businesses:
You can now team up with other businesses to:
• Share childcare facilities
• Jointly contract with providers

➡️ Each business still claims its share of the credit
➡️ Lower cost + less admin burden

🏢 Who qualifies?
Any business with W-2 employees:
• Sole proprietors
• Partnerships
• LLCs
• S corps

⚠️ Note: You generally can’t claim this for your own childcare — but you can for employees (including spouse-employees).

💡 Even if the benefit is taxable to the employee, the tax credit can still create significant net savings.

📌 Bottom line:
If you’re offering (or even considering) childcare support for employees…

👉 This credit is now too valuable to ignore.

04/02/2026

🏡 Husband & Wife LLC? Don’t overlook this tax surprise…

Many couples set up an LLC for rental property thinking it’s simple protection. But when tax time rolls around, a big question pops up:

👉 Do you have to file a partnership return?

Here’s the reality 👇

💼 By default, the IRS treats a 2-member LLC (yes—even spouses) as a partnership
📄 That means filing Form 1065 + issuing K-1s
⚠️ Even if it’s “just your rental property”

🚫 Common misconceptions:

“We’re married, so it’s simpler” → Not necessarily
“It’s just co-ownership” → Not if it’s inside an LLC
“We can use a joint venture election” → Not allowed with an LLC

📍 There IS one exception:

If you live in a community property state (only 9 states), you may be able to treat the LLC as a single entity and file one Schedule E ✅

But in the other 41 states?

👉 You’re filing as a partnership—no shortcuts.

💡 Bottom line:

An LLC gives liability protection, but it can also mean extra tax filings and complexity.

Before you set one up, make sure you understand both sides of the equation ⚖️

03/31/2026

🚨 Taxpayers, beware: a small mailing mistake could cost you BIG 💸

For years, the rule was simple: mail your tax return by the deadline, and you’re good. But things have changed—and it’s catching people off guard.

📬 Here’s the problem:

USPS now often applies postmarks at regional processing centers, not your local post office. That means even if you drop your return off on April 15… it might get stamped April 16 (or later). 😬

👉 The IRS goes by the postmark date, not when you mailed it.
👉 Even ONE day late can mean penalties + interest (up to 5% of what you owe 💥)

⚠️ It gets worse:

Some mail doesn’t get postmarked at all
At-home or kiosk postage labels don’t count as proof of mailing.

✅ How to protect yourself:

✔️ Go to the post office counter and request a manual postmark
✔️ Use certified mail for proof (your receipt = legal protection)
✔️ Or better yet—file electronically for instant confirmation 💻

📌 Bottom line: Don’t let a technicality turn into a costly mistake. A few extra minutes today can save you serious money tomorrow.

03/17/2026

Most firms say they have “systems.”

Very few actually run on them.

We were recently featured by Trainual on how we’ve built our internal operations at Sterling Tax & Accounting, from onboarding to team structure to maintaining consistency as we grow.

This wasn’t about having pretty SOPs.

It’s about:
• A team that actually uses the systems
• Clear expectations across roles
• Consistency during tax season (not chaos)
• Building something that scales beyond the founder

Trainual only works if the team buys in, and I’m proud to say ours does.

If you’ve ever felt like your firm (or business) lives in your head instead of in systems, this is your reminder that it doesn’t have to stay that way.

How do modern accounting firms scale without chaos?In this customer story, Lea Graf (CPA, CGMA), Founder & President of Sterling Tax & Accounting, explains h...

01/22/2026

🚨 Got IRS Penalties? Don’t Pay Just Yet! 💸

Before you send a dime to the IRS, pause—you may be able to wipe those penalties out entirely 👀👇

The IRS often charges hefty penalties for:
⏰ Filing late
💳 Paying late
👷 Missing employment tax deposits

But here’s the good news 👉 many penalties can be reduced, removed, or even refunded 💥

🔍 Common IRS Penalties
▪️ Late filing: Up to 25% of unpaid tax 📈
▪️ Late payment: 0.5% per month, up to 25%
▪️ Employment tax deposits: 2%–10% depending on how late

🛡️ Ways to Get Penalty Relief
✅ First-Time Abate – Clean compliance history? You may qualify to have penalties removed with one simple request 📞
🤝 Partnership Relief – Small partnerships (10 or fewer partners) may qualify under special IRS rules
📄 Reasonable Cause – Illness, disasters, or major life events can justify relief

🔄 Already paid the penalty?
You may still be able to get your money back by filing IRS Form 843 💵 (time limits apply!)

📌 Pro tip: Using the right language when speaking with the IRS can make all the difference.

⚖️ Bottom line: IRS penalties aren’t always final. Know the rules, ask the right questions, and you might owe nothing at all.