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Availability of Home Office Deductions
If you’re self-employed and work out of an office in your home, don't forget the availability of home office deductions. However, you must satisfy strict rules. If you qualify, you can deduct the “direct expenses” of the home office. This includes the costs of painting or repairing the home office and depreciation deductions for furniture [...]
When the Fraud Suspect is an Executive
Businesses and fraud experts often face a long, arduous process when investigating any occupational fraud incident. When the fraud suspect is an executive . . . a member of upper management . . . it’s exponentially harder. In theory, investigating executives shouldn’t differ from the process of investigating rank-and-file employees. In reality, the authority and [...]
How to Keep Weddings Affordable
(This is Blog Post #803)
Beneish Model Helps Detect Earnings Manipulation
Financial statement manipulation is the costliest type of occupational fraud. The latest Report to the Nations published by the Association of Certified Fraud Examiners found that the median loss from financial statement fraud was $800,000, compared to median losses of $114,000 for asset misappropriation and $250,000 for corruption. With any type of fraud, the sooner it’s [...]
Reduce Tax with an S Corporation
Do you conduct your business as a sole proprietorship or as a wholly owned limited liability company (LLC)? If so, you’re subject to both income tax and self-employment tax. There may be a way to reduce tax with an S corporation. Self-employment tax basics The self-employment tax is imposed on 92.35% of self-employment income at [...]
When is Married Filing Separate Better?
Married couples often wonder whether they should file joint or separate tax returns. When is married filing separate betrter? The answer depends on your individual tax situation. It generally depends on which filing status results in the lowest tax. But keep in mind that, if you and your spouse file a joint return, each of [...]
Tax Aspects of Selling Mutual Fund Shares
Perhaps you’re an investor in mutual funds or you’re interested in putting some money into them. You’re not alone. The Investment Company Institute estimates that 56.2 million households owned mutual funds in mid-2017. But despite their popularity, the tax rules involved in selling mutual fund shares can be complex. Selling mutual fund shares: tax basics [...]
Downside to High Employment Rates
(This is Blog Post #798)
Going Into Business for Yourself
When you make the decision of going into business for yourself, you'll find that many people who launch small businesses start out as sole proprietors. Here are nine tax rules and considerations involved in operating as that entity. 1. You may qualify for the pass-through deduction. To the extent your business generates qualified business income, [...]
Don’t Approve That Office Supply Invoice Yet
When Dan received a large shipment of highlighter markers, he was confused. He didn’t remember ordering them — and he was the company’s sole office supplies buyer. Yet when he received an invoice for the markers a week later, he approved it for payment. After all, employees were already using the highlighters. Dan fell for a [...]
Guidance on PPP Loan Calculations for Self-Employed Individuals
The Small Business Administration (SBA), in consultation with the Department of the Treasury, has issued guidance to assist businesses in calculating their payroll costs for purposes of determining the amount of a Paycheck Protection Program (PPP) loan businesses can apply for. Borrowers and lenders may rely on the guidance provided in this document as SBA’s interpretation [...]
Eligible IRA Withdrawals Now Penalty-Free
(This is Blog Post #794)
Economic Impact Payment FAQs
Millions of eligible Americans have already received their Economic Impact Payments (EIPs) via direct deposit or paper checks, according to the IRS. Others are still waiting. The payments are part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Here are some answers to Economic Impact Payment FAQs. Who’s eligible to get an EIP? [...]
Employment Tax Deposit Deferral FAQs
On its website, IRS has issued FAQs on the deferral of the deposit and payment of the employer's share of Social Security taxes and self-employed individuals to defer payment of certain self-employment taxes that is provided by the Coronavirus, Aid, Relief and Economic Security Act (CARES Act). These employment tax deposit deferral FAQs will be updated [...]
CARES Act’s Impact on Excess Business Losses
Back in Blog Post #778 on 4/1/20, I summarized the Coronavirus Aid, Relief, and Economic Security (CARES) Act tax provisions. That post included a brief discussion of the CARES Act’s impact on excess business losses. Here is more about the deferral of, and changes to the limit on, excess business losses. Deferral of the excess [...]
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.
