23 Mar 2025
0

Many Business Tax Limits Have Increased in 2025

Roger Rossmeisl, CPA
Small Business Tax Briefs
Many Business Tax Limits Have Increased in 2025

A variety of tax-related limits that affect businesses are indexed annually based on inflation. Many have increased for 2025, but with inflation cooling, the increases aren’t as great as they have been in the last few years. Here are some amounts that may affect you and your business. . 2025 deductions as compared with 2024 Section 179 expensing: Limit: $1.25 million (up from $1.22 million) Phaseout: $3.13 million (up from $3.05 million) Sec. 179 expensing limit for certain heavy vehicles: $31,300 (up from $30,500) Standard mileage rate for business driving: 70 cents per mile (up from 67 cents) Income-based phaseouts for certain limits on the Sec. 199A qualified business income deduction begin at: Married filing jointly: $394,600 (up from $383,900) Other filers: $197,300 (up from $191,950) . Retirement plans in...

23 Mar 2025
0

The Standard Business Mileage Rate Increased in 2025

Roger Rossmeisl, CPA
Small Business Tax Briefs
The Standard Business Mileage Rate Increased in 2025

The nationwide price of gas is slightly higher than it was a year ago and the 2025 optional standard mileage rate used to calculate the deductible cost of operating an automobile for business has also gone up. The IRS recently announced that the 2025 cents-per-mile rate for the business use of a car, van, pickup or panel truck is 70 cents. In 2024, the business cents-per-mile rate was 67 cents per mile. This rate applies to gasoline and diesel-powered vehicles as well as electric and hybrid-electric vehicles. The process of calculating rates The 3-cent increase from the 2024 rate goes along with the recent price of gas. On January 17, 2025, the national average price of a gallon of regular gas was $3.11, compared with $3.08 a year earlier, according...

09 Mar 2025
0

Small Business Strategy: A Heavy Vehicle Plus a Home Office Equals Tax Savings

Roger Rossmeisl, CPA
Small Business Tax Briefs
Small Business Strategy: A Heavy Vehicle Plus a Home Office Equals Tax Savings

New and used “heavy” SUVs, pickups and vans placed in service in 2025 are potentially eligible for big first-year depreciation write-offs. One requirement is you must use the vehicle more than 50% for business. If your business usage is between 51% and 99%, you may be able to deduct that percentage of the cost in the first year. The write-off will reduce your federal income tax bill and your self-employment tax bill, if applicable. You might get a state tax income deduction too. Setting up a business office in your home for this year can also help you collect tax savings. Here’s what you need to know about the benefits of combining these two tax breaks. First, buy a suitably heavy vehicle The generous first-year depreciation deal is...

03 Mar 2025
0

Treasury Announces Suspension of BOI Reporting

Roger Rossmeisl, CPA
Automotive, Current Events, Small Business Tax Briefs
Treasury Announces Suspension of BOI Reporting

As posted to US Department of Treasury website on 3/2/25 The Treasury Department announced on 3/2/25 that, with respect to the Corporate Transparency Act, not only will it not enforce any penalties or fines associated with the beneficial ownership information reporting rule under the existing regulatory deadlines, but it will further not enforce any penalties or fines against U.S. citizens or domestic reporting companies or their beneficial owners after the forthcoming rule changes take effect either. The Treasury Department will further be issuing a proposed rulemaking that will narrow the scope of the rule to foreign reporting companies only. Treasury takes this step in the interest of supporting hard-working American taxpayers and small businesses and ensuring that the rule is appropriately tailored to advance the public...

23 Feb 2025
0

How Section 1231 Gains and Losses Affect Business Asset Sales

Roger Rossmeisl, CPA
Small Business Tax Briefs
How Section 1231 Gains and Losses Affect Business Asset Sales

When selling business assets, understanding the tax implications is crucial. One area to focus on is Section 1231 of the Internal Revenue Code, which governs the treatment of gains and losses from the sale or exchange of certain business property. Business gain and loss tax basics The federal income tax character of gains and losses from selling business assets can fall into three categories: Capital gains and losses. These result from selling capital assets which are generally defined as property other than 1) inventory and property primarily held for sale to customers, 2) business receivables, 3) real and depreciable business property including rental real estate, and 4) certain intangible assets such as copyrights, musical works and art works created by the taxpayer. Operating businesses typically don’t own capital assets, but they...

23 Feb 2025
0

Understanding the Work Opportunity Tax Credit

Roger Rossmeisl, CPA
Small Business Tax Briefs
Understanding the Work Opportunity Tax Credit

According to the U.S. Bureau of Labor Statistics, the unemployment rate continues to be historically low, ranging from 4.0% to 4.3% from May to November of 2024. With today’s hiring challenges, business owners should be aware that the Work Opportunity Tax Credit (WOTC) is available to employers that hire workers from targeted groups who face significant barriers to employment. The tax credit is generally worth as much as $2,400 for each eligible employee (higher for certain veterans and “long-term family assistance recipients”). It’s generally limited to eligible employees who begin working for the employer before January 1, 2026. To satisfy a requirement of the WOTC, a pre-screening notice must be completed by the job applicant and the employer on or before the day a job offer...

20 Feb 2025
0

FinCEN Reinstates Beneficial Ownership Reporting Mandate with New March 21, 2025 Deadline

Roger Rossmeisl, CPA
Automotive, Current Events, Small Business Tax Briefs
FinCEN Reinstates Beneficial Ownership Information Mandate with New March 21, 2025 Deadline

In a major development for U.S. businesses, the Financial Crimes Enforcement Network (FinCEN) has announced the reinstatement of the beneficial ownership information (BOI) reporting mandate under the Corporate Transparency Act (CTA). The decision comes on the heels of a February 18, 2025, ruling by the U.S. District Court for the Eastern District of Texas, which lifted a preliminary injunction in the case of Smith, et al. v. U.S. Department of the Treasury, et al. (Case No. 6:24-cv-00336). With this ruling, the filing requirement is back in effect, and a new deadline of March 21, 2025, has been set for most reporting companies. This announcement, detailed in FinCEN Notice FIN-2025-CTA1, marks a significant shift after months of legal uncertainty surrounding the CTA’s BOI requirements. The reinstated mandate...

16 Feb 2025
0

Operating as a C Corporation: Weigh the Benefits and Drawbacks

Roger Rossmeisl, CPA
Small Business Tax Briefs
Operating as a C Corporation: Weigh the Benefits and Drawbacks

When deciding on the best structure for your business, one option to consider is a C corporation. This entity offers several advantages and disadvantages that may significantly affect your business operations and financial health. Here’s a detailed look at the pros and cons of operating as a C corporation. Tax implications A C corporation allows the business to be treated and taxed separately from you as the principal owner. The corporate tax rate is currently 21%, which is lower than the highest non-corporate tax rate of 37%. One of the primary disadvantages of a C corporation is double taxation. The corporation’s profits are taxed at the corporate level and then any dividends distributed to shareholders are taxed again at the individual level. This can result in a higher overall tax...

16 Feb 2025
0

Tax Treatment of Intangible Assets

Roger Rossmeisl, CPA
Small Business Tax Briefs
Tax Treatment of Intangible Assets

Intangible assets, such as patents, trademarks, copyrights and goodwill, play a crucial role in today’s businesses. The tax treatment of these assets can be complex, but businesses need to understand the issues involved. Here are some answers to frequently asked questions. What are intangible assets? The term “intangibles” covers many items. Determining whether an acquired or created asset or benefit is intangible isn’t always easy. Intangibles include debt instruments, prepaid expenses, non-functional currencies, financial derivatives (including, but not limited to, options, forward or futures contracts, and foreign currency contracts), leases, licenses, memberships, patents, copyrights, franchises, trademarks, trade names, goodwill, annuity contracts, insurance contracts, endowment contracts, customer lists, ownership interests in any business entities (for example, corporations, partnerships, LLCs, trusts and estates) and other rights, assets, instruments and...

07 Feb 2025
0

Update on BOI Reporting from FinCEN 02-06-25 Alert

Roger Rossmeisl, CPA
Automotive, Current Events, Small Business Tax Briefs
Update on BOI Reporting from FinCEN 02-06-25 Alert

In a significant development for businesses across the United States, the legal landscape surrounding the Corporate Transparency Act (CTA) has taken a pivotal turn with the case of Smith et al. v. U.S. Department of the Treasury. Here’s what you need to know about the current state of affairs and what might lie ahead: The Legal Background On January 7, 2025, the U.S. District Court for the Eastern District of Texas issued a preliminary injunction in the case Smith v. U.S. Department of the Treasury, halting the enforcement of the CTA's beneficial ownership information (BOI) reporting requirements. This decision was a direct response to concerns raised by the plaintiffs, Samantha Smith and Robert Means, regarding the applicability and implications of these regulations on their businesses. Recent Developments The Department...

ROGER ROSSMEISL, CPA

Kho & Patel CPAs
160 E. Arrow Highway
San Dimas, CA 91773

(714) 325-0442
roger@khopatel.com

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