automotive cpa Archives - Page 11 of 34

03 Aug 2021

10 Facts About the Pass-Through Deduction for Qualified Business Income

Are you eligible to take the deduction for qualified business income (QBI)? Here are 10 facts about this valuable tax break, referred to as the pass-through deduction, QBI deduction or §199A deduction. It’s available to owners of sole proprietorships, single member limited liability companies (LLCs), partnerships and S corporations. It may also be claimed by trusts and estates. The deduction is intended to reduce the tax rate on QBI to a rate that’s closer to the corporate tax rate. It’s taken “below the line.” That means it reduces your taxable income but not your adjusted gross income. But it’s available regardless of whether you itemize deductions or take the standard deduction. The deduction has two components: 20% of QBI from a domestic business operated as...

27 Jul 2021

Business Meal and Vehicle Expense Recordkeeping DOs and DON’Ts

Roger Rossmeisl, CPA

Small Business Tax Briefs

Business Meal and Vehicle Expense Recordkeeping DOs and DONTs

If you’re claiming deductions for business meals or auto expenses, expect the IRS to closely review them. In some cases, taxpayers have incomplete documentation or try to create records months (or years) later. In doing so, they fail to meet the strict substantiation requirements set forth under tax law. Tax auditors are adept at rooting out inconsistencies, omissions and errors in taxpayers’ records, as illustrated by one recent U.S. Tax Court case. Facts of the case In the case, the taxpayer ran a notary and paralegal business. She deducted business meals and vehicle expenses that she allegedly incurred in connection with her business. The deductions were denied by the IRS and the court. Tax law “establishes higher substantiation requirements” for these and certain other expenses, the court noted....

20 Jul 2021

IRS 2021 “Dirty Dozen” – Persuading Taxpayers into Unscrupulous Actions

Roger Rossmeisl, CPA

Fraud Briefs

IRS 2021 Dirty Dozen - Persuading Taxpayers into Unscrupulous Actions

Compiled annually, the “Dirty Dozen” lists a variety of common scams that taxpayers may encounter anytime but many of these schemes peak during filing season as people prepare their returns or hire someone to help with their taxes. This year's "Dirty Dozen" is separated into four separate categories: Pandemic-related scams like Economic Impact Payment theft (See Blog Post 1049) Personal information cons including phishing, ransomware and phone "vishing" (See Blog Post 1050) Ruses focusing on unsuspecting victims like fake charities and senior/immigrant fraud (See Blog Post 1051) Schemes that persuade taxpayers into unscrupulous actions such as Offer In Compromise mills and syndicated conservation easements (This Blog Post) The Internal Revenue Service, in IR 2021-144, concluded the "Dirty Dozen" list of tax scams with a warning to taxpayers...

20 Jul 2021

IRS 2021 “Dirty Dozen” – Preying on Unsuspecting Victims

Roger Rossmeisl, CPA

Fraud Briefs

IRS 2021 Dirty Dozen - Preying on Unsuspecting Victims

Compiled annually, the “Dirty Dozen” lists a variety of common scams that taxpayers may encounter anytime but many of these schemes peak during filing season as people prepare their returns or hire someone to help with their taxes. This year's "Dirty Dozen" is separated into four separate categories: Pandemic-related scams like Economic Impact Payment theft (See Blog Post 1049) Personal information cons including phishing, ransomware and phone "vishing" (See Blog Post 1050) Ruses focusing on unsuspecting victims like fake charities and senior/immigrant fraud (This Blog Post) Schemes that persuade taxpayers into unscrupulous actions such as Offer In Compromise mills and syndicated conservation easements (See Blog Post 1052) The Internal Revenue Service, via IR 2021-141, continued its "Dirty Dozen" tax scams with a warning for people to watch...

20 Jul 2021

IRS 2021 “Dirty Dozen” – Pandemic-Related Scams

Roger Rossmeisl, CPA

Fraud Briefs

IRS 2021 Dirty Dozen - Pandemic Related Scams

Compiled annually, the “Dirty Dozen” lists a variety of common scams that taxpayers may encounter anytime but many of these schemes peak during filing season as people prepare their returns or hire someone to help with their taxes. This year's "Dirty Dozen" will be separated into four separate categories: Pandemic-related scams like Economic Impact Payment theft (This Blog Post) Personal information cons including phishing, ransomware and phone "vishing" (See Blog Post 1050) Ruses focusing on unsuspecting victims like fake charities and senior/immigrant fraud (See Blog Post 1051) Schemes that persuade taxpayers into unscrupulous actions such as Offer In Compromise mills and syndicated conservation easements (See Blog Post 1052) Economic Impact Payment theft A continuing threat to individuals is from identity thieves who try to steal Economic Impact Payments...

20 Jul 2021

IRS Releases It’s “Dirty Dozen” Scam List for 2021

Roger Rossmeisl, CPA

Fraud Briefs

IRS Announces Dirty Dozen Scams for 2021

Compiled annually, the “Dirty Dozen” lists a variety of common scams that taxpayers may encounter anytime but many of these schemes peak during filing season as people prepare their returns or hire someone to help with their taxes. On 6/28/21 the Internal Revenue Service, via IR 2021-135, began its "Dirty Dozen" list for 2021 with a warning for taxpayers, tax professionals and financial institutions to be on the lookout for these 12 nefarious schemes and scams. This year's "Dirty Dozen" will be separated into four separate categories: Pandemic-related scams like Economic Impact Payment theft (See Blog Post 1049) Personal information cons including phishing, ransomware and phone "vishing" (See Blog Post 1050) Ruses focusing on unsuspecting victims like fake charities and senior/immigrant fraud (See Blog Post 1051) Schemes...

11 Jul 2021

Revisiting the Employee Retention Tax Credit

Roger Rossmeisl, CPA

Small Business Tax Briefs

Revisiting the Employee Retention Tax Credit

The Employee Retention Tax Credit (ERTC) is a valuable tax break that was extended and modified by the American Rescue Plan Act (ARPA), enacted in March of 2021. Here’s a rundown of the rules for businesses that have considered revisiting the Employee Retention Tax Credit. Background Back in March of 2020, Congress originally enacted the ERTC in the CARES Act to encourage employers to hire and retain employees during the pandemic. At that time, the ERTC applied to wages paid after March 12, 2020, and before January 1, 2021. However, Congress later modified and extended the ERTC to apply to wages paid before July 1, 2021. The ARPA again extended and modified the ERTC to apply to wages paid after June 30, 2021, and before January 1, 2022. Thus, an eligible employer can...

16 Jun 2021

An S Corporation Could Cut Your Self-Employment Tax

Roger Rossmeisl, CPA

Small Business Tax Briefs

An S Corporation Could Cut Your Self-Employment Tax

If your business is organized as a sole proprietorship or as a wholly owned limited liability company (LLC), you’re subject to both income tax and self-employment tax. There may be a way to cut your tax bill by conducting business as an S corporation. Fundamentals of self-employment tax The self-employment tax is imposed on 92.35% of self-employment income at a 12.4% rate for Social Security up to a certain maximum ($142,800 for 2021) and at a 2.9% rate for Medicare. No maximum tax limit applies to the Medicare tax. An additional 0.9% Medicare tax is imposed on income exceeding $250,000 for married couples ($125,000 for married persons filing separately) and $200,000 in all other cases. What if you conduct your business as a partnership in which you’re a...

15 Jun 2021

Understanding How to Report Large Cash Transactions (Form 8300)

Roger Rossmeisl, CPA

Automotive, Small Business Tax Briefs

Understanding How to Report Large Cash Transactions (Form 8300)

The Internal Revenue Service recently reminded businesses (in News Release 2021-47) of their responsibility to report large cash transactions via the filing of Form 8300, Report of Cash Payments Over $10,000, and encourages e-filing to help them file accurate, complete forms. Although many cash transactions are legitimate, information reported on Form 8300 can help stop those who evade taxes, profit from drug trading, engage in terrorist financing and conduct other criminal activities. The government can often trace money from these illegal activities through payments reported on complete, accurate forms. To help businesses prepare and file reports, the IRS created a video on How to Complete Form 8300 – Part I, Part II. The short video points out sections of Form 8300 for which the IRS commonly finds...

10 Facts About the Pass-Through Deduction for Qualified Business Income

Business Meal and Vehicle Expense Recordkeeping DOs and DON’Ts

IRS 2021 “Dirty Dozen” – Persuading Taxpayers into Unscrupulous Actions

IRS 2021 “Dirty Dozen” – Preying on Unsuspecting Victims

IRS 2021 “Dirty Dozen” – Pandemic-Related Scams

IRS Releases It’s “Dirty Dozen” Scam List for 2021

Revisiting the Employee Retention Tax Credit

An S Corporation Could Cut Your Self-Employment Tax

Understanding How to Report Large Cash Transactions (Form 8300)

ROGER ROSSMEISL, CPA

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