Superior Results. Delivered.
Blog
The “Nanny Tax” Must be Paid for Nannies and Other Household Workers
You may have heard of the “nanny tax.” But if you don’t employ a nanny, you may think it doesn’t apply to you. Check again. Hiring a housekeeper, gardener or other household employee (who isn’t an independent contractor) may make you liable for federal income and other taxes. You may also have state tax obligations. [...]
Liquidation vs Going-Concern Value: What’s Right for a Distressed Business?
U.S. commercial bankruptcies surged in 2023, as businesses across many industries struggle with rising costs, a tight labor market, lackluster demand, economic uncertainty and geopolitical risks. When valuing a distressed business, its value as a going concern might not necessarily be appropriate. Some situations call for liquidation value. Here’s how these premises of value differ [...]
Giving Gifts and Throwing Parties Can Help Show Gratitude and Provide Tax Breaks
During this holiday seasons, your business may want to show its gratitude to employees and customers by giving them gifts or hosting holiday parties. It’s a good time to review the tax rules associated with these expenses. Are they tax deductible by your business and is the value taxable to the recipients? Employee gifts Many [...]
A Company Car is a Valuable Perk But Don’t Forget About Taxes
One of the most appreciated fringe benefits for owners and employees of small businesses is the use of a company car. This perk results in tax deductions for the employer as well as tax breaks for the owners and employees driving the cars. (And of course, they enjoy the non-tax benefit of using a company [...]
Are Vendors Cheating Your Company?
Every year, U.S. companies lose millions of dollars to vendor fraud. These schemes can be complex and usually involve collusion of multiple suppliers or suppliers and employees of the defrauded business. Small businesses that don’t use sophisticated vendor software or don’t have other anti-fraud resources are particularly vulnerable. But knowledge is power. Learn what vendor [...]
Don’t Forget to Empty Out Your Flexible Spending Account
If you have a tax-saving flexible spending account (FSA) with your employer to help pay for health or dependent care expenses, there’s an important date coming up. You may have to use the money in the account by year-end or you’ll lose it (unless your employer has a grace period). As the end of 2023 [...]
There May Still Be Time to Reduce your Small Business 2023 Tax Bill
In the midst of holiday parties and shopping for gifts, don’t forget to consider steps to cut the 2023 tax liability for your business. You still have time to take advantage of a few opportunities. Time deductions and income If your business operates on a cash basis, you can significantly affect your amount of taxable [...]
Levels of Value: Why it Matters in a Business Valuation
A business may have more than one value, depending on the purpose of the business valuation and the characteristics of the ownership interest. Before an expert starts working on a business valuation, it’s important to discuss the appropriate level of value. Otherwise, confusion over levels of value may lead to miscommunication and misinformed business decisions. [...]
Unclaimed Property Voluntary Compliance Program Now Available in California
California AB 2280 established a new Unclaimed Property Voluntary Compliance Program that waives interest for taxpayers who voluntarily come into compliance with unclaimed property reporting requirements. The State Controller’s Office (SCO) has now opened the sign up process for businesses to apply for the program. Unclaimed Property Reporting Explained California businesses holding property belonging to [...]
Filing a Final Return for a Deceased Taxpayer
As reported via IRS Tax Tip 2023-51 4/17/2023 After someone with a filing requirement passes away, their surviving spouse or representative should file the deceased person's final tax return. On the final tax return, the surviving spouse or representative should note that the person has died. The IRS doesn't need a copy of the death certificate [...]
Tax Basics for Setting up a Businesses
As reported via IRS Tax Tip 2023-103 9/5/2023 Starting a new business can seem overwhelming for new entrepreneurs or even seasoned professionals. The IRS has resources to help new business owners understand the tax responsibilities of running a business. Here are a few things any entrepreneur needs to do when starting their business. Choose a [...]
Individual Home Energy Tax Credits for 2023
Taxpayers who make home energy improvements in 2023 may be able to benefit from tax credits for a portion of the qualifying expenses. The credit amounts have been increased, and types of qualifying expenses were expanded, by the Inflation Reduction Act of 2022. This post is intended to assist taxpayers in comparing the tax credits [...]
Tax Tips for New Parents
As reported via IRS Tax Tip 2023-89 in October 2019 Kids are expensive. Whether someone just brought a bundle of joy home from the hospital, adopted a teen from foster care, or is raising their grandchild. There are several tax breaks that can help. Here are some tax tips for new parents Get the child [...]
Employment Tax Considerations When Hiring Parents or Children
As reported via IRS Fact Sheet 2019-14 in October 2019 One of the advantages of someone running their own business is hiring family members. But when including family members in business operations, certain tax treatments and employment tax rules apply. Here are some facts to know when working with a spouse, parent or child. Both [...]
Is Your Side Hustle a Hobby or a Business?
As reported via IRS Tax Tip 2023-61 on 5/3/2023 Sometimes the line between having a hobby and running a business can be confusing, but knowing the difference is important because hobbies and businesses are treated differently when it's time to file a tax return. The biggest difference between the two is that businesses operate to [...]
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.
