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Some Taxpayers Qualify for More Favorable “Head of Household”Tax Filing Status
When preparing your tax return, we’ll check one of the following statuses: Single, married filing jointly, married filing separately, head of household or qualifying widow(er). Filing a return as a head of household is more favorable than filing as a single taxpayer. For example, the 2023 standard deduction for a single taxpayer is $13,850 while [...]
How to Outsmart Social Media Scammers
With billions of users worldwide, social media platforms can be a breeding ground for illicit activity — from simple identity theft to sophisticated and wide-ranging fraud schemes. Here’s an overview of some of the most common social media scams and tips to help prevent you or your business from becoming a fraud victim. Crooks find [...]
Choosing an Entity for Your Business? How About an S Corporation?
If you’re starting a business with some partners and wondering what type of entity to form, an S corporation may be the most suitable form of business for your new venture. Here are some of the reasons why. A big benefit of an S corporation over a partnership is that as S corporation shareholders, you won’t [...]
2023 Q2 Tax Calendar: Key Deadlines for Businesses and Employers
Here are some of the key tax-related deadlines that apply to businesses and other employers during the second quarter of 2023. Keep in mind that this list isn’t all-inclusive, so there may be additional deadlines that apply to you. Contact us to ensure you’re meeting all applicable deadlines and to learn more about the filing [...]
7 Questions to Ask About a Business Valuation Report
Business valuation experts will usually provide formal written reports that explain how they arrived at their conclusions. Asking seven questions can help you determine whether an expert’s report is comprehensive and on-point. (1) Did the expert properly define the engagement? Most valuation reports start with a detailed description of the assignment. Beyond the name of [...]
Gift Tax Return Basics
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 2022 gift tax return. And in some cases, even if it’s not required to file one, you may want to do so anyway. Filing requirements The annual gift tax [...]
That Investment Opportunity Could be a Pyramid Scheme
The “investment opportunity” someone just pitched could be a legitimate way to get in on the ground floor of a soon-to-be profitable business. However, it could also be a pyramid, Ponzi or similar fraudulent multi-level marketing scheme. How can you tell the difference between a real investment and a scam? Don’t get scammed Pyramid schemes [...]
Changes in Sec. 174 Make it a Good Time to Review the R&E Strategy of Your Business
It’s been years since the Tax Cuts and Jobs Act (TCJA) of 2017 was signed into law, but it’s still having an impact. Several provisions in the law have expired or will expire in the next few years. One provision that took effect last year was the end of current deductibility for research and experimental [...]
Claiming Losses on Depreciated or Worthless Stock
Have you bought stock in a company that later dropped in value? While you may prefer to forget such an ill-fated investment, at least you can claim a capital loss deduction on your tax return. Here are the rules that apply when a stock you own is sold at a loss or becomes completely worthless. [...]
Measuring Fair Value for Financial Reporting Purposes
Fair market value is the appropriate standard of value in most business valuation assignments. But when valuing an asset for financial reporting purposes, fair value is generally used. Here’s an overview of what fair value is and how it differs from fair market value. Eyes on GAAP The terms “fair value” and “fair market value” [...]
The Tax Advantages of Hiring Your Child This Summer
Summer is around the corner so you may be thinking about hiring young people at your small business. At the same time, you may have children looking to earn extra spending money. You can save family income and payroll taxes by putting your child on the payroll. It’s a win-win! Here are four tax advantages. [...]
Protect the “Ordinary and Necessary” Advertising Expenses of Your Business
Under tax law, businesses can generally deduct advertising and marketing expenses that help keep existing customers and bring in new ones. This valuable tax deduction can help businesses cut their taxes. However, in order to be deductible, advertising and marketing expenses must be “ordinary and necessary.” As one taxpayer recently learned in U.S. Tax Court, [...]
IRS Issues Guidance Related to the New Clean Vehicle Critical Mineral and Battery Components
As appearing in IRS Newswire IR-2023-64 The Internal Revenue Service just issued a proposed regulation related to certain requirements that must be met for critical minerals and battery components for the new clean vehicle credit. The Inflation Reduction Act (IRA) allows a maximum credit of $7,500 per vehicle, consisting of $3,750 in the case of [...]
Awarded Money in a Lawsuit or Settlement? It’s Only Tax-Free in Certain Circumstances
You generally must pay federal tax on all income you receive but there are some exceptions when you can exclude it. For example, compensatory awards and judgments for “personal physical injuries or physical sickness” are free from federal income tax under the tax code. This includes amounts received in a lawsuit or a settlement and [...]
Turn That Fraud Dispute into a Loyalty-Building Opportunity
If customers report fraud or suspicious charges on their accounts, what might seem like a challenge can actually be an opportunity for your business. Handle these disputes efficiently and you can regain — and even strengthen — customer loyalty. The alternative: angry customers, damage to your reputation and financial losses. Your customer dispute resolution processes [...]
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.
