automotive cpa Archives - Page 35 of 37

28 Jun 2019

Chances of IRS Audit are Down

The IRS just released its audit statistics for the 2018 fiscal year, and the chances of IRS audit are down. Fewer taxpayers had their returns examined as compared with prior years. Even though less returns are being audited, that will be little consolation if yours is one of them. Chances of IRS audit are down: latest statistics Overall, just 0.59% of individual tax returns were audited in 2018, as compared with 0.62% in 2017. This was the lowest percentage of audits conducted since 2002. However, as in the past, those with very high incomes face greater odds. For example, in 2018, 2.21% of taxpayers with AGIs of between $1 million and $5 million were audited. That's down from 3.52% in 2017. The richest taxpayers, those with AGIs of $10...

28 Jun 2019

Consider a Roth 401(k) Plan

Roger Rossmeisl, CPA

Small Business Tax Briefs

Roth 401(k) accounts have been around for 13 years now. Studies show that more employers are offering them each year. A recent study by the Plan Sponsor Council of America (PSCA) found that Roth 401(k) Plans are now available at 70% of employer plans, up from 55.6% of plans in 2016. However, despite the prevalence of employers offering Roth 401(k)s, most employees aren’t choosing to contribute to them. The PSCA found that only 20% of participants who have access to a Roth 401(k) made contributions to one in 2017. Perhaps it’s because they don’t understand them. If you offer a Roth 401(k) Plan or you’re considering one, educate your employees about the accounts to boost participation. Roth 401(k) Plans: a 401(k) with a twist As the name implies, these...

27 Jun 2019

Employee Conflicts of Interest

Roger Rossmeisl, CPA

Fraud Briefs

One of the governing principles of the employee/employer relationship is that employees have a fiduciary duty to act in their employer’s interests. Undisclosed employee conflicts of interest can be a serious breach of this duty. In fact, when employees aren't on your side, companies often suffer financial consequences. Employee conflicts of interest: ignorance isn’t bliss Here’s a fictional example of a common conflict of interest: Matt is the manager of a manufacturing company’s purchasing department. He’s also part owner of a business that sells supplies to the manufacturer — a fact Matt hasn’t disclosed to his employer. And, in fact, Matt has personally profited from the business’s lucrative long-term contract with his employer. What makes this scenario a conflict of interest isn’t so much that Matt has profited...

26 Jun 2019

Combining Business with Pleasure Travel

Roger Rossmeisl, CPA

Small Business Tax Briefs

Summer is here, so you might be thinking about getting some vacation time. If you’re self-employed or a business owner, you have a golden opportunity for combining business with pleasure travel for a few extra days and offset some of the cost with a tax deduction. But be careful, or you might not qualify for the write-offs you’re expecting. Combining business with pleasure travel: basic rules Business travel expenses can potentially be deducted if the travel is within the United States and the expenses are: “Ordinary and necessary” and Directly related to the business. Note: The tax rules for foreign business travel are different from those for domestic travel. Business owners and the self-employed are generally eligible to deduct business travel expenses if they meet the tests described...

26 Jun 2019

Key Q3 2019 Deadlines for Businesses

Roger Rossmeisl, CPA

Small Business Tax Briefs

Here are some of the key Q3 2019 deadlines for businesses and other employers that are tax related. Keep in mind that this list isn’t all-inclusive, so there may be additional deadlines that apply to you. July 31 Report income tax withholding and FICA taxes for the second quarter of 2019 (Form 941) and pay any tax due. (See the exception below, under “August 12.”) File a 2018 calendar-year retirement plan report (Form 5500 or Form 5500-EZ) or request an extension. August 12 Report income tax withholding and FICA taxes for the second quarter of 2019 (Form 941), if you deposited on time and in full all of the associated taxes due. September 16 If a calendar-year C corporation, pay the third installment of 2019...

26 Jun 2019

Leaving Specific Assets to Specific Heirs

Roger Rossmeisl, CPA

Estate Planning Briefs

Estate Plans That Leave Specific Assets to Specific Heirs

Planning your estate around specific assets is risky and, in most cases, should be avoided. If you are leaving specific assets to specific heirs (such as homes, cars or stock), you may inadvertently disinherit them. Leaving specific assets to specific heirs: Illustrating the problem Let’s say Debbie has three children — Abbie, Mary Kate and Lizzie. Debbie wishes to treat them equally in her estate plan. In her will, Debbie leaves a $500,000 mutual fund to Abbie and her home valued at $500,000 to Mary Kate. She also names Lizzie as beneficiary of a $500,000 life insurance policy. Now consider this scenario when Debbie dies years later: the mutual fund balance has grown to $750,000, Debbie had sold the home for $750,000, invested the proceeds in the mutual...

22 Jun 2019

Formula Funding Clause in Older Estate Plans

Roger Rossmeisl, CPA

Estate Planning Briefs

The gift and estate tax exemption is higher than it’s ever been. You can thank the Tax Cuts and Jobs Act (TCJA) for that. TCJA temporarily doubled the exemption to an inflation-adjusted $10 million. $20 million for married couples who design their estate plans properly. This year, the exemption amount is $11.4 million ($22.8 million for married couples). Because of this, estate plans containing a formula funding clause (FFC) should be reviewed. If you’re married and you executed your estate planning documents years ago, when the exemption was substantially lower, review your plan to ensure that the increased exemption doesn’t trigger unintended results. It’s not unusual for older estate planning documents to include a FFC. FFCs split assets between a credit shelter trust and the surviving...

19 Jun 2019

Facebook’s New Crypto “Libra” Explained

Roger Rossmeisl, CPA

Current Events, Social Thoughts, Technology

As posted to the Ben Swann YouTube Channel on 6/18/19 Facebook's New Crypto "Libra" Explained Investigative journalist Ben Swann gives his take on how Facebook's new crypto "Libra" is not actually decentralized. Plus, it's been established with a "pay to play" scheme for governence of the coin. The players are Facebook, Uber, Lyft, Spotify Visa, Mastercard. and other multinationals who paid a $10 million entry fee. Decentralization Ben goes on to explain "the concept of decentralization. Cryptocurriency's power, is to break the current financial systems that are in effect, and returning that power to the people. Libra does not do that, it has no interest in doing that. It only continues to reinforce the power structures that are already in place." Why Facebook Won't Know What You're Spending Your Libra...

19 Jun 2019

How to Spot Influencer Fraud

Roger Rossmeisl, CPA

Fraud Briefs

To increase brand awareness and influence consumer behavior, businesses of all sizes spend vast amounts on social media marketing. Social media “influencers” can help companies reach and engage customers. But not all influencers operate above board. Here’s how to spot influencer fraud. And in so doing, avoid hiring or associating with a dishonest influencer. How to spot influencer fraud: The more, the better There’s no commonly accepted definition of how many followers an influencer must have to claim such status. But in general, the more, the better. After all, clients want access to as many eyes as possible. Knowing how important followers, likes and shares are, some influencers find it hard to resist the temptation to inflate their numbers. In general, they can command higher fees and attract...

19 Jun 2019

Hire Your Children This Summer

Roger Rossmeisl, CPA

Small Business Tax Briefs

If you’re a business owner and you hire your children (or grandchildren) this summer, you can obtain tax breaks and other non-tax benefits. The kids can gain on-the-job experience, save for college and learn how to manage money. And you may be able to: Shift your high-taxed income into tax-free or low-taxed income, Realize payroll tax savings (depending on the child’s age and how your business is organized), and Enable retirement plan contributions for the children. Hire your children, but it must be a real job When you hire your child, you get a business tax deduction for employee wage expenses. In turn, the deduction reduces your federal income tax bill, your self-employment tax bill (if applicable), and your state income tax bill (if applicable). However, in...

Chances of IRS Audit are Down

Consider a Roth 401(k) Plan

Employee Conflicts of Interest

Combining Business with Pleasure Travel

Key Q3 2019 Deadlines for Businesses

Leaving Specific Assets to Specific Heirs

Formula Funding Clause in Older Estate Plans

How to Spot Influencer Fraud

Hire Your Children This Summer

ROGER ROSSMEISL, CPA

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