Category: News
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New Business? It’s A Good Time To Start A Retirement Plan
If you recently launched a business, you may want to set up a tax-favored retirement plan for yourself and your employees. There are several types of qualified plans that are eligible for these tax advantages: A current deduction from income to the employer for contributions to the plan, A tax-free buildup of the value of…
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Buying And Selling Mutual Fund Shares: Avoid These Tax Pitfalls
If you invest in mutual funds, be aware of some potential pitfalls involved in buying and selling shares. Surprise sales You may already have made taxable “sales” of part of your mutual fund investment without knowing it. One way this can happen is if your mutual fund allows you to write checks against your fund…
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What Tax Records Can You Throw Away?
October 15 is the deadline for individual taxpayers who extended their 2019 tax returns. (The original April 15 filing deadline was extended this year to July 15 due to the COVID-19 pandemic.) If you’re finally done filing last year’s return, you might wonder: Which tax records can you toss once you’re done? Now is a…
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The Tax Rules For Deducting The Computer Software Costs Of Your Business
Do you buy or lease computer software to use in your business? Do you develop computer software for use in your business, or for sale or lease to others? Then you should be aware of the complex rules that apply to determine the tax treatment of the expenses of buying, leasing, or developing computer software.…
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Tax Implications Of Working From Home And Collecting Unemployment
COVID-19 has changed our lives in many ways, and some of the changes have tax implications. Here is basic information about two common situations. 1. Working from home. Many employees have been told not to come into their workplaces due to the pandemic. If you’re an employee who “telecommutes” — that is, you work at…
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5 Key Points About Bonus Depreciation
Under current law, 100% bonus depreciation will be phased out in steps for property placed in service in calendar years 2023 through 2027. Thus, an 80% rate will apply to property placed in service in 2023, 60% in 2024, 40% in 2025, and 20% in 2026, and a 0% rate will apply in 2027 and…
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More Parents May Owe “Nanny Tax” This Year, Due To COVID-19
In the COVID-19 era, many parents are hiring nannies and babysitters because their daycare centers and summer camps have closed. This may result in federal “nanny tax” obligations. Keep in mind that the nanny tax may apply to all household workers, including housekeepers, babysitters, gardeners, or others who aren’t independent contractors. If you employ someone…
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The Possible Tax Consequences Of PPP Loans
If your business was fortunate enough to get a Paycheck Protection Program (PPP) loan taken out in connection with the COVID-19 crisis, you should be aware of the potential tax implications. PPP basics The Coronavirus Aid, Relief and Economic Security (CARES) Act, which was enacted on March 27, 2020, is designed to provide financial assistance…
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Are Scholarships Tax-Free Or Taxable?
COVID-19 is changing the landscape for many schools this fall. But many children and young adults are going back, even if it’s just for online learning, and some parents will be facing tuition bills. If your child has been awarded a scholarship, that’s cause for celebration! But be aware that there may be tax implications.…
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Businesses: Get Ready For The New Form 1099-NEC
There’s a new IRS form for business taxpayers that pay or receive nonemployee compensation. Beginning with the tax year 2020, payers must complete Form 1099-NEC, Nonemployee Compensation, to report any payment of $600 or more to a payee. Why the new form? Prior to 2020, Form 1099-MISC was filed to report payments totaling at least…