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FAQs About Resolving Small Business Tax Issues
Tax problems can happen to even the most organized small business owners. A cash flow crunch, an unexpected tax notice, a missed filing deadline or a payroll tax oversight can be stressful — especially when penalties and interest begin to add up. Fortunately, businesses can get back on track by addressing tax issues promptly and [...]
Ask Your Audit Committee to Oversee Fraud Prevention
Fraud prevention starts at the top — with the board of directors. In fact, an engaged audit committee (or other oversight team, such as an advisory board) can help protect your organization from criminal threats, both internal and external. Reviewing financial statements and audit results remains an important responsibility of the committee. But audit committees [...]
Mid-Year Tax Planning: Review Opportunities to Save Taxes This Year (or Next)
Summer is a good time to see whether your income, deductions and investment activity are lining up as expected. Let’s take a look at a few areas that commonly provide tax-saving opportunities. Your tax bracket The legislation commonly known as the One Big Beautiful Bill Act (OBBBA), which was signed into law on July 4, [...]
Selecting a Tax Accounting Method for your Small Business
Small business owners must answer an important question: Should we use the cash or accrual accounting method for federal income tax purposes? Larger entities are required to use the accrual method. But certain small businesses can elect to use the cash method. You may want to consider this option if it will help lower your [...]
Why Business Owners Need a Valuation to Address Estate Planning Needs
Summer is often a good time to revisit your estate plan, especially if you’re getting together with loved ones for vacations or family gatherings. Of course, if you own a closely held business, it should be a critical part of your plan. Although you might be aware of some rules of thumb for valuing businesses [...]
Will Your Social Security Benefits be Taxable?
Last year, the new tax deduction for taxpayers 65 and older was sometimes referred to as “no tax on Social Security.” In actuality, this up-to-$6,000-per-individual deduction, also known as the “senior” deduction, is generally available whether or not someone receives Social Security benefits. (But other limits do apply, such as an income-based phaseout.) Of course, [...]
Fraud Targeting Veterans is a Small Business Issue
U.S. military veterans own majority stakes in more than 1.6 million businesses and represent 5.3% of this country’s business owners, according to the U.S. Small Business Administration. Even if you aren’t a veteran, you might employ individuals who’ve served. Employees who suffer fraud losses may be distracted and less productive at work — and the resulting [...]
What’s the Right Entity Type for your New Business
Start-ups must choose a legal entity for their business activities. The type of entity you select affects how the business is taxed and who may be held personally liable for its debts and obligations, among other things. Two popular options — assuming you’re going into business with one or more other people — are S [...]
When the Sale of an Appreciated Home Triggers Taxes — and When it Doesn’t
Home values have risen significantly in many areas of the country over the last several years, leaving some homeowners with substantial gains when they sell. Of course a large profit is generally a good thing. But, depending on the amount of your gain, how long you’ve owned and resided in the home, and your income [...]
Don’t Let the IRS Treat Your Sideline as a Hobby
Do you operate a side gig in addition to your regular day job? Whether you’ve turned a love for crafting into an online store or you play the guitar at a local venue, you’ll need to report the income from your sideline activity on your tax return. But can you deduct the related expenses? The [...]
Revenue Ruling 59-60: Does Your Business Valuation Cover All The Bases?
The IRS created Revenue Ruling 59-60 to outline the methods and factors to consider when valuing closely held businesses for federal gift and estate tax purposes. Today, it’s often referenced in valuations prepared for other reasons, including divorce cases and shareholder disputes. Here’s a closer look at what it prescribes, including lesser-known details that you [...]
Don’t Overlook These Tax Issues After a Job Loss
Even with a relatively low unemployment rate (averaging around 4.4% over the past year), layoffs and terminations continue to affect workers across many industries. If you’ve recently lost your job, you’re likely focused on replacing income and evaluating your next steps. But some tax implications related to a job loss also may require attention. Here [...]
Demystifying Like-Kind Exchanges
If you’re a real estate developer or a small business owner who owns commercial real estate, you might be thinking about selling a property. If it has appreciated significantly, a §1031 like-kind exchange may allow you to defer tax on some or all of the gain. With this transaction, you exchange one property for another [...]
Prevent Task Fragmentation from Hiding Fraud
Fraud can be difficult to detect when different employees handle different parts of a transaction. A dishonest manager may instruct several employees to perform routine tasks that appear legitimate. But because each employee sees only a small piece of the process, no one recognizes that the overall transaction might be fraudulent. This tactic, known as [...]
The “Kiddie Tax” Can Apply Long After Childhood
Many parents don’t know that the so-called “kiddie tax” exists. Others assume it affects only minor children. But it also can apply to full-time students through age 23 and 18-year-olds even if they aren’t full-time students. When it applies, most of the child’s unearned income may be taxed at the parent’s higher tax rate. The [...]
Disclaimer
This blog is designed to provide competent and reliable information regarding the subject matter covered. However, it is being provided with the understanding that the blogmaster is not engaged in rendering investment advice. Laws and practices often vary from state to state and if investment assistance is required, the services of a licensed investment professional should be sought. The blogmaster resolutely encourages the reader/viewer to do their own research and due diligence before acting on any information contained herein. As such, Roger Rossmeisl specifically disclaims any liability that is incurred from the use or application of the contents of this blog. It should also be noted that the views contained in this blog are not necessarily representative of the opinions/beliefs of the other owners, management and/or employees of Kho & Patel CPAs.
