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Numerous Tax Limits Affecting Businesses Have Increased for 2022
Many tax limits that affect businesses are annually indexed for inflation, and a number of them have increased for 2022. Here’s a rundown of those that may be important to you and your business. Social Security tax The amount of an employee’s earnings that is subject to Social Security tax is capped for 2022 at [...]
Help Safeguard your Personal Information by Filing your 2021 Tax Return Early
The IRS announced it is opening the 2021 individual income tax return filing season on January 24. (Business returns are already being accepted.) Even if you typically don’t file until much closer to the April deadline (or you file for an extension until October), consider filing earlier this year. Why? You can potentially protect yourself [...]
To Prove Fraud, You Need to Preserve Evidence
Prevention is the heart of any fraud mitigation program. But sometimes even solid internal controls fail (because, for example, a manager overrides controls) and occupational fraud occurs. If you suspect an employee of stealing, you’ll want to do everything you can to ensure the perpetrator is caught. In most cases, you should hand a fraud [...]
Keep Your Tax Return Safe from “Ghosts”
(This is Blog Post #1159)
How Will Revised Tax Limits Affect Your 2022 Taxes?
While Congress didn’t pass the Build Back Better Act in 2021, there are still tax changes that may affect your tax situation for this year. That’s because some tax figures are adjusted annually for inflation. If you’re like most people, you’re probably more concerned about your 2021 tax bill right now than you are about [...]
When Subsequent Events Count
The value of a business interest is valid as of a specific date. The effective date is a critical cutoff point because events that occur after that date generally are not taken into account when estimating value. However, there are two key exceptions when subsequent events count. (1) When an event is foreseeable Subsequent events [...]
Businesses with Employees who Receive Tips may be Eligible for a Tax Credit
If you’re an employer with a business where tipping is customary for providing food and beverages, you may qualify for a federal tax credit involving the Social Security and Medicare (FICA) taxes that you pay on your employees’ tip income. Basics of the credit The FICA credit applies with respect to tips that your employees [...]
Are You Eligible for a Medical Expense Tax Deduction?
You may pay out a bundle in out-of-pocket medical costs each year. But can you deduct them on your tax return? It’s possible but not easy. Medical expenses can be claimed as a deduction only to the extent your unreimbursed costs exceed 7.5% of your adjusted gross income. Plus, medical expenses are deductible only if [...]
Defer Tax with a Like-Kind Exchange
Do you want to sell commercial or investment real estate that has appreciated significantly? One way to defer a tax bill on the gain is with a §1031 “like-kind” exchange where you exchange the property rather than sell it. With real estate prices up in some markets (and higher resulting tax bills), the like-kind exchange [...]
Salespeople and Commission Fraud
Many employees — from retail workers to sales staffers involved in complex business-to-business transactions — receive part of their compensation from sales-related commissions. To attract and retain top talent, some companies even allow employees to earn unlimited commissions. Unfortunately, some commission-compensated employees may be tempted to abuse this system by falsifying sales or rates. Fraud [...]
Tax Obligations of Gig Workers
The number of people engaged in the “gig” or sharing economy has grown in recent years. In an August 2021 survey, the Pew Research Center found that 16% of Americans have earned money at some time through online gig platforms. This includes providing car rides, shopping for groceries, walking dogs, performing household tasks, running errands [...]
What Factors into the Cost of Capital?
Valuation experts often use discounted cash flow (DCF) techniques to determine the value of a business or estimate economic losses. A critical input in a DCF model is the cost of capital. This is the rate that’s used to discount future earnings into today’s dollars. Small changes in this rate can have a major impact [...]
2022 Business Mileage Rate
After two years of no increases, the optional standard mileage rate used to calculate the deductible cost of operating an automobile for business will be going up in 2022 by 2.5 cents per mile. The IRS recently announced that the cents-per-mile rate for the business use of a car, van, pickup or panel truck will [...]
Do You Qualify for the Student Loan Interest Deduction?
If you’re paying back college loans for yourself or your children, you may wonder if you can deduct the interest you pay on the loans. The answer is yes, subject to certain limits. The maximum amount of student loan interest you can deduct each year is $2,500. Unfortunately, the deduction is phased out if your [...]
2022 Q1 Tax Calendar: Key Deadlines for Businesses
Here are some of the key tax-related deadlines affecting businesses and other employers during the first quarter of 2022. 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 requirements. January [...]
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.
