Probity Accounting, PLLC

11/13/2025

"When most people think about taxes, they immediately think of the federal income tax..." We have a lot of different taxes at all levels of government, and they help provide all the services we use and benefit from every day. This is a great short video from the Tax Foundation that explains these different levels.

Each level of government provides its own services and therefore levies its own taxes to generate revenue for these services.

04/14/2025

The IRS has granted tax filing and payment relief to Arkansans due to the storms, tornado, and flooding, beginning April 2. All filing deadlines and payment deadlines have been postponed to November 3, 2025.

This means, for example, that the Nov. 3, 2025, deadline will now apply to:

Individual income tax returns and payments normally due on April 15, 2025.
2024 contributions to IRAs and health savings accounts for eligible taxpayers.
Quarterly estimated tax payments normally due on April 15, June 16 and Sept. 15, 2025.
Quarterly payroll and excise tax returns normally due on April 30, July 31 and Oct. 31, 2025.
Calendar-year corporation and fiduciary returns and payments normally due on April 15, 2025.
Calendar-year tax-exempt organization returns normally due on May 15, 2025.

Previously, Arkansas has postponed deadlines for 63 counties to July 31, 2025. However, the Governor's office advised that an additional Executive Order will be issued to include the remaining 12 counties. It is not known yet if they will follow the Federal deadline yet.

If you live in Arkansas, or your business is located in Arkansas, you have some tax relief, but don't get behind. You don't want November 3 to sneak up on you like a mortgage balloon payment. Keep as current as you can.

Photo credit: Anete Lusina, 2020, downloaded from Pexels.com

04/04/2025

The Tax Foundation is a non-partisan tax policy nonprofit. They strive to improve lives through tax policies that lead to greater economic growth and opportunity.

Their research is sought by legislatures all over America, from sides of the aisle. And they do really good work.

Here's some of what they have to say about Trump's Tariffs claims. It's worth listening to and educating yourself about.

Do tariffs really level the playing field, or are they just bad economics? In this emergency episode, we fact-check the Trump administration’s claims that retaliatory tariffs make trade fairer.

08/01/2024

So, I just heard about a new term: Friendpreneurship. This is simply two friends who have an idea to make money and they go into business together.

This may be more common than you think. Friends are more likely to have similar ideas and interests. Also, if you have a friend, you likely like to spend time with that person, so why not have them as your coworker as well.

Starting a friendpreneurship has some tax consequences though, so be aware. Anytime you have more than one owner in a business, you have a special tax form. A very simple, "let's shake hands and agree" business is a partnership. You may not even have a Partnership Agreement (although you should), but it will be taxed like a partnership and have to be reported on the Form 1065, U.S. Return of Partnership Income.

Some individuals, particularly if they have personal assets they want to protect like a home or retirement, may want to start an LLC, or a Limited Liability Company. That's fine. But it doesn't change the fact that it is taxed as a partnership, unless the LLC makes an election to be taxed as a C Corporation or an S Corporation.

So, have those awesome business ideas. Make a ton of money with your friend. When you do, be aware that you've got an extra responsibility to file a separate tax return. And keep in mind that you want to plan for all the possibilities of the partners getting out of the business too: plan for selling their share of the business, their incapacity, and their death. Don't be stuck with a mess because you didn't do a Partnership Agreement (or an Operating Agreement if you use an LLC).

Photo by Amina Filkins: https://www.pexels.com/photo/laughing-women-having-conversation-in-flower-shop-5413994/

07/22/2024

Hey Everyone! If you have a company, you need to know about the new Beneficial Ownership Information (BOI) reporting requirements. Check out the attached fact sheets and www.FinCEN.gov/boi.

Let me know if you have any questions.

12/15/2023

Drive Your Deductions: The Standard Mileage Deduction

Hey everyone. Let's talk about turning your miles into money with the Standard Mileage Deduction!

First: BREAKING NEWS
The IRS has increased the rate to 67 cents per mile for 2024, up from 1.5 cents in 2023 (65.5 cents per mile).

What is it?
The Standard Mileage Deduction is like a magic wand for your business-related driving expenses. Instead of tracking every gas receipt and maintenance cost, the IRS lets you deduct a standard amount for each business mile driven.

When to Use it?
Wondering when to use the standard mileage deduction? It's great for those who prefer a simpler route. If you use your vehicle for work-related trips but don't want to log every expense, the standard mileage rate could be your best bet.

Saves Time, Maximizes Deductions
The standard rate is designed to encompass various costs like gas, maintenance, and depreciation in one neat package. So, it's not just a time-saver; it's a deduction-maximizer too.

Exceptions and Nitty-Gritty
As with any tax perk, there are details to consider. Commuting from home to your regular workplace usually doesn't count. But business meetings, client visits, and errands related to work certainly do!

Keep a Mileage Log
While the standard rate is a blessing, the IRS still wants some proof. Maintain a mileage log detailing your business travels. There are handy apps that can make this a breeze, ensuring you have the evidence you need.

Need Help Navigating?
If the Standard Mileage Deduction is sparking questions in your mind, I'm here to help. Let's make sure you're getting every mile's worth of deductions you deserve.

Drive smart, drive savvy, and let's turn those miles into money!



Photo by Mikhail Nilov: https://www.pexels.com/photo/aerial-view-of-the-seven-mile-bridge-above-the-sea-9400885/

09/06/2023

Roth IRA or Traditional IRA? Let's Find Your Fit!

Let's dive into a hot topic today: Roth IRA vs. Traditional IRA. These retirement accounts might look similar, but they have some differences that could make a big impact on your financial future.

Roth IRA
When to Consider It: If you're in the early stages of your career or you anticipate your tax rate to be higher in retirement, the Roth IRA is your go-to account. With a Roth, you invest post-tax money, and the magic happens when you make withdrawals in retirement – they're usually tax-free! "Post-tax money" means you don't get a deduction or any reduction on your employment and income taxes when you take the money home.

Special Savings: The Roth IRA offers flexibility. You can access your contributions (not earnings) penalty-free at any time. This can be a lifeline in emergencies. I don't recommend doing this often, but it is something to consider.

Keep in Mind: There are income limits for contributing to a Roth IRA, so high earners may need to explore other options. Also, you have to have a ROTH open for five years before you can take out earnings, even if you are over 59 1/2. So, plan for that five-year to just contribute instead of withdraw.

Traditional IRA
When to Consider It: If you're looking to lower your taxable income now or expect to be in a lower tax bracket when you retire, the traditional IRA is your best choice. Your contributions are tax-deductible today, but you'll pay taxes when you withdraw the funds in retirement.

Employer Match: If your employer offers any retirement plan that matches your contributions, do that first. It's like free money ('cause it is)! Grab that opportunity if it's on the table. But, that's not the point of this post. Just wanted to throw that out there.

RMD Reminder: Remember, with a traditional IRA, you'll need to take required minimum distributions (RMDs) starting at age 72 or 73 (depends on when you were born). Keep this in mind for your retirement planning. ROTH IRAs do not require withdrawals until after the death of the owner.

The Hybrid Option: Backdoor Roth
If your income exceeds the Roth IRA limits, there's a nifty backdoor option. You can contribute to a traditional IRA and then convert it to a Roth. Just be aware of the tax implications when you make the conversion.

Let's Chart Your Course
The right choice depends on your unique financial situation and goals. It's not a one-size-fits-all deal. That's where your CPA and financial advisors come in. We're here to help you navigate these choices and make the best decision for your financial plan.

Let's Chat
Have questions or want to explore your retirement account options further? Drop me a message or give me a call. I'm here to make sure you're on the path to financial success!

08/31/2023

Mark Your Calendars: September 15th Tax Deadline Ahead!

Just a friendly heads-up: the September 15th tax deadline is on the horizon. Who is this for? This is for Partnerships and S Corporations who filed an extension from March 15th. Let's break it down:

Who's in the Spotlight?
September 15th isn't just another day for business owners—it's an important moment if you're part of a partnership or an S corporation. If that's you, you'll want to ensure your tax returns are polished and ready to shine. But also, these owners and sole proprietors should be considering making their third estimated quarterly payment for their 2023 taxes by September 15th.

Why It Matters
You know the saying, "Procrastination is the thief of time"? Well, the tax version goes like this: "Filing late can lead to penalties!" Avoid those by getting ahead of the game and submitting your returns on time.

Getting Help
Got questions or feeling a bit overwhelmed? Remember, you don't have to tackle this solo. Your friendly neighborhood CPA (that's me!) is here to answer your questions, guide you through the process, and ensure you're making the most of every deduction and credit available.

Countdown Commences
The clock is ticking, but there's still time to conquer the September 15th deadline. Remember, it's not just about filing—it's about filing right.

So, mark that date, gather your documents, and let's rock this September 15th tax deadline together. If you've got questions, comments, or just want to chat about your tax strategy, I'm here and ready to chat.

08/23/2023

Selling Your Home? Let's Talk Tax!

Hey there! If you're thinking about selling your home or curious about the tax side of things, stick around. I'm here to shed some light on the if, when, and how much when it comes to taxable gains from selling your home. Let's dive in!

Primary Residence Perks
First things first, if you've been using that lovely abode of yours as your primary residence, you're in luck. The IRS has a sweet deal for you called the Home Sale Exclusion. This means that if you meet certain criteria (like living there for at least 2 out of the past 5 years), you can exclude up to $250,000 of gain from your tax calculation. If you're married and filing jointly, that number doubles to a whopping $500,000! In Arkansas, not many homes sell for more than half a million more than what you paid for it.

Timing Matters
Now, about when. To make the most of that juicy exclusion, your home sale needs to happen after you've owned the place for at least two years and lived in it for two years as your main residence. So, if you've been planning to move on to your next adventure, keep the timing in mind to maximize your tax benefits.

What's Taxable?
Here's the scoop on how much might be taxable. If your gain exceeds that amazing exclusion limit we talked about, the additional amount is generally considered a capital gain. This gain could be subject to capital gains tax. But fear not, it's not as bad as it sounds! Depending on your income and the specific situation, the tax rate can vary, from a maximum of 20% all the way down to 0% for the IRS!

Exceptions and Nitty-Gritty
Like any tax tale, there are exceptions and nitty-gritty details. If you've rented out parts of your home, have a super fancy price tag on your property, or you're selling due to special circumstances, things can get a bit more complex. That's when having a tax expert (yours truly!) can come in handy. We'll navigate the twists and turns for you.

Document, Document, Document
Remember, good documentation is your best friend here. Keep records of purchase and improvement costs, as they can help offset your gains. And of course, your trusty CPA (yes, that's me!) can guide you on what to track and how to do it.

Phew, that was a whirlwind! Just remember, selling your home can be a fantastic opportunity, and understanding the tax implications is a crucial part of the process. If you're gearing up to sell or you have questions about your specific situation, don't hesitate to reach out.