Tax Season – Time to Get Organized and Start Filing

If you didn’t begin creating year-end tax plans before last December 31, it could be worth your while now to start gathering together all your documentation and get organized. The Internal Revenue Service started accepting tax returns as of Tuesday, January 19, though you could have prepared a return on paper or with tax software and submitted it earlier. The IRS wouldn’t accept such returns until the 19th however. Filing early helps to lower any
Continue Reading

Benefits of the R & D Tax Credit for Small Business

The tax deal instituted by Congress at the end of 2015 makes the R & D tax credit permanent. This deal also includes two crucial changes to the R & D tax credit which provide a vital benefit to innovative small businesses, especially startups. Business owners need to examine these changes closely. First, the legislation permits small businesses to take the credit against their AMT (the AMT turnoff). Secondly, the bill permits small businesses to
Continue Reading

2015 Strategic Tax Planning for Businesses

YEAR-END BUSINESS PLANNING As with prior years, business tax planning is unsure due to the expiration of many popular but temporary tax breaks that have been of an “extenders” package of legislation. Another factor leading to uncertainty is the far-reaching Affordable Care Act. Additional changes to the tax law in 2015 made by new regulations and other IRS guidance also need to be weighed when evaluating year-end strategies. Code Sec. 179 Expensing Code Sec. 179
Continue Reading

2015 Strategic Tax Planning for Individuals

YEAR-END INDIVIDUAL PLANNING As in years past, there may be value in the customary year-end methods of shifting income. Taking stock of income and expenses to determine whether measures to defer or accelerate one or the other, before the close of the current tax year, should be considered as applicable at year-end 2015 as it has been in the past. As markets continue to adjust and fluctuate, it makes sense to evaluate current gains and
Continue Reading

Research and Development Credits Updates

On 12/19/2014, President Obama signed the H. R. 5771 Bill, known as the Tax Increase Prevention Act.  This means that a host of tax credits are being extended to another tax year. Among these is the Research and Development credit. Many small and middle sized businesses do not claim the credit because of the complications in calculating it: The research credit equals the sum of: (1) 20% of the excess (if any) of the qualified
Continue Reading

Latest Updates on the Tax Increase Prevention Act of 2014

On December 16, 2014, Congress passed what is known as an extenders package including more than 50 of the tax credits that expired at the end of 2013. President Obama has signed the Act on December 19, 2014 and it is effective for the 2014 tax year only. Some of the most prominent tax credits are: state and local sales tax deduction, higher education tuition deduction, and the exclusion for discharge of mortgage debt, business and
Continue Reading

Alternative Minimum Tax

AMT (Alternative Minimum Tax) AMT was created back in the 1970’s and then with serious teeth in the 1986 tax reform act which was to simplify taxes. AMT is a political system that renders certain tax deductions useless like state income and property taxes.  AMT was actually created and refined when Republicans held the legislative and executive branches and is seen by many as a way to equalize the field for taxpayers in high state
Continue Reading

Expiring 2014 Tax Provisions

  List of 2014 Expiring Tax Provisions 55 tax breaks are expiring, here is a list of some of the most important ones. A tax credit for research and development, benefiting a wide range of industries, including manufacturers, pharmaceutical makers and high tech companies. The tax break saved companies an estimated $6.2 billion in 2013.  This is a 20% tax credit on R&D expenditures. An exemption that allows banks, insurance companies and other financial firms
Continue Reading

IRS Audits

Anatomy of an IRS Audit As a taxpayer representative and preparer, I’ve recently finished up 3 interesting audit cases with the IRS and would like to share how they went: 1st Case: A client of mine was selected for an IRS audit due to a large partnership loss from a K1 that he invested in.  The IRS is currently auditing partnership losses especially for passive activity limitations.  Only issue is that partnership losses in this case
Continue Reading

Obamacare New Taxes 1/1/14

Obamacare Taxes 3% Tax on Medical Device Manufacturers 2014 10% Tax on Indoor Tanning Services 2014 Blue Cross/Blue Shield Tax Hike Excise Tax on Charitable Hospitals which fail to comply with the requirements of ObamaCare Tax on Brand Name Drugs Tax on Health Insurers $500,000 Annual Executive Compensation Limit for Health Insurance Executives Elimination of tax deduction for employer-provided retirement Rx drug coverage in coordination with Medicare Part D Employer Mandate on business with over
Continue Reading