Roger Rossmeisl, CPA, Author at Roger Rossmeisl, CPA

17 Apr 2019

(#528) Could Your Business Benefit from the Tax Credit for Family and Medical Leave?

The Tax Cuts and Jobs Act created a new federal tax credit for employers that provide qualified paid family and medical leave to their employees. It’s subject to numerous rules and restrictions and the credit is only available for two tax years — those beginning between January 1, 2018, and December 31, 2019. However, it may be worthwhile for some businesses. The value of the credit An eligible employer can claim a credit equal to 12.5% of wages paid to qualifying employees who are on family and medical leave, if the leave payments are at least 50% of the normal wages paid to them. For each 1% increase over 50%, the credit rate increases by 0.25%, up to a maximum credit rate of 25%. An eligible employee is...

16 Apr 2019

(#527) Create a “Road Map” for your Estate Plan

Roger Rossmeisl, CPA

Estate Planning Briefs

No matter how much effort you’ve invested in designing your estate plan . . . your will, trusts and other official documents may not be enough. Consider creating a “road map” — an informal letter or other document that guides your family in understanding and executing your plan and ensuring that your wishes are carried out. Navigating your world Your road map should include, among other things: A list of important contacts, including your estate planning attorney, accountant, insurance agent and financial advisors, The location of your will, living and other trusts, tax returns and records, powers of attorney, insurance policies, deeds, stock certificates, automobile titles, and other important documents, A personal financial statement that lists stocks, bonds, real estate, bank accounts, retirement plans, vehicles and other...

02 Apr 2019

(#526) The 2018 Gift Tax Return Deadline is Almost Here

Roger Rossmeisl, CPA

Individual Tax Briefs

Did you make large gifts to your children, grandchildren or other heirs last year? If so, it’s important to determine whether you’re required to file a 2018 gift tax return — or whether filing one would be beneficial even if it isn’t required. Filing requirements Generally, you must file a gift tax return for 2018 if, during the tax year, you made gifts: That exceeded the $15,000-per-recipient gift tax annual exclusion (other than to your U.S. citizen spouse), That you wish to split with your spouse to take advantage of your combined $30,000 annual exclusion, That exceeded the $152,000 annual exclusion for gifts to a non-citizen spouse, To a §529 college savings plan and wish to accelerate up to five years’ worth of annual exclusions ($75,000) into...

02 Apr 2019

(#525) There’s Still Time for Small Business Owners to Set Up a SEP Retirement Plan for Last Year

Roger Rossmeisl, CPA

Small Business Tax Briefs

If you own a business and don’t have a tax-advantaged retirement plan, it’s not too late to establish one and reduce your 2018 tax bill. A Simplified Employee Pension (SEP) can still be set up for 2018, and you can make contributions to it that you can deduct on your 2018 income tax return. Contribution deadlines A SEP can be set up as late as the due date (including extensions) of your income tax return for the tax year for which the SEP is to first apply. That means you can establish a SEP for 2018 in 2019 as long as you do it before your 2018 return filing deadline. You have until the same deadline to make 2018 contributions and still claim a potentially substantial deduction...

02 Apr 2019

(#524) Is Return Fraud Cutting Into Your Store’s Profits?

Roger Rossmeisl, CPA

Fraud Briefs

For brick-and-mortar retailers, return fraud can be a serious financial threat. There are several types of schemes. But when they’re successful, they all end the same way: Stores issue refunds that they shouldn’t have. Here’s what to look for and how to limit losses. Myriad schemes Return fraud perpetrators could be customers, employees or even a criminal gang working with employee accomplices. In perhaps the most common scheme, an individual steals merchandise, and then returns it and insists on a cash refund, despite the lack of a receipt. Or a criminal steals merchandise from one retailer and then returns it to another for a cash refund. Some thieves do supply receipts — but they’re fake. The “customer” hands over an altered or completely counterfeit receipt that the original...

02 Apr 2019

(#523) Moving a Trust Over State Lines Can Offer Tax Savings and Other Benefits

Roger Rossmeisl, CPA

Estate Planning Briefs

People who live in states with high income taxes sometimes relocate to a state with a more favorable tax climate. A similar strategy can be available for trusts. If a trust is subject to high state income taxes, you may be able to change its residence — or “situs” — to a state with low or no income taxes. What can a “trust-friendly” state offer? In addition to offering low (or no) tax on trust income, some states: Authorize domestic asset protection trusts, which provide added protection against creditors’ claims, Permit silent trusts, under which beneficiaries need not be notified of their interests, Allow perpetual trusts, enabling grantors to establish “dynasty” trusts that benefit many generations to come, Have directed trust statutes, which make it possible to...

01 Apr 2019

(#522) Vehicle Expense Deduction Ins and Outs for Individual Taxpayers

Roger Rossmeisl, CPA

Individual Tax Briefs

It’s not just businesses that can deduct vehicle-related expenses. Individuals also can deduct them in certain circumstances. Unfortunately, the Tax Cuts and Jobs Act (TCJA) might reduce your deduction compared to what you claimed on your 2017 return. For 2017, miles driven for business, moving, medical and charitable purposes were potentially deductible. For 2018 through 2025, business and moving miles are deductible only in much more limited circumstances. TCJA changes could also affect your tax benefit from medical and charitable miles. Current limits vs. 2017 Before 2018, if you were an employee, you potentially could deduct business mileage not reimbursed by your employer as a miscellaneous itemized deduction. But the deduction was subject to a 2% of adjusted gross income (AGI) floor, which meant that mileage was deductible...

27 Mar 2019

(#521) Prevent Fraud With The Help Of Your Audit Committee

Roger Rossmeisl, CPA

Fraud Briefs

Your board’s audit committee is a first line of defense against fraud. But to be effective, committee members need to do more than simply review financial statements and audit results. Members should also adopt the following best practices: Conduct risk assessments. Identify the types of risks faced by your company and their likelihood of occurrence. These assessments should include an evaluation of existing internal controls. Be knowledgeable. Become familiar with relevant accounting issues and recent developments. Also ask questions and challenge management on the accounting for complex transactions. If your company’s industry has specialized accounting rules, consider consulting outside specialists. Communicate with external auditors. Regularly touch base with outside auditors, because the external audit team performs many fraud prevention functions. Schedule formal meetings before the audit to elicit input...

27 Mar 2019

(#520) Will Leasing or Buying Equipment Be More Tax Efficient for Your Business?

Roger Rossmeisl, CPA

Small Business Tax Briefs

Recent changes to federal tax law and accounting rules could affect whether you decide to lease or buy equipment or other fixed assets. Although there’s no universal “right” choice, many businesses that formerly leased assets are now deciding to buy them. Pros and cons of leasing From a cash flow perspective, leasing can be more attractive than buying. And leasing does provide some tax benefits: Lease payments generally are tax deductible as “ordinary and necessary” business expenses. (Annual deduction limits may apply.) Leasing used to be advantageous from a financial reporting standpoint. But new accounting rules that bring leases to the lessee’s balance sheet go into effect in 2020 for calendar-year private companies. So, lease obligations will show up as liabilities, similar to purchased assets that are financed...

21 Mar 2019