By now, some businesses have completed their 2021 budgets while others are still crunching numbers and scrutinizing line items. As you put the finishing touches on your company’s spending plan for next year, be sure to cover the finer points of the process. This means not just creating a budget for the sake of doing … Read More
As year end approaches, it’s a good idea for calendar-year entities to review the guidelines for recognizing revenue and expenses. There are specific rules regarding accounting cutoffs under U.S. Generally Accepted Accounting Principles (GAAP). Strict observance of these rules is generally the safest game plan. The basics Companies that follow GAAP must use the accrual … Read More
The IRS has provided a safe harbor for deducting expenses if a Paycheck Protection Program (PPP) loan isn’t forgiven. The safe harbor allows a taxpayer to claim a 2020 deduction for deductible eligible expenses if they received a PPP loan that: 1) the taxpayer expects to be forgiven after the 2020 tax year, and 2) … Read More
Make filing your 2020 federal income tax return easier with some preparation. The IRS is reminding taxpayers to get ready for the 2021 filing season. Steps you can take now include, gathering your W-2, Wage and Tax Statements and Forms 1099 for Misc. Income, notices of unemployment compensation, refund interest, gig economy income and virtual … Read More
Small business owners are well aware of the increasing cost of employee health care benefits. As a result, your business may be interested in providing some of these benefits through an employer-sponsored Health Savings Account (HSA). Or perhaps you already have an HSA. It’s a good time to review how these accounts work since the … Read More
Did you not receive an Economic Impact Payment (EIP) in 2020? If so, you may be able to claim a Recovery Rebate Credit when filing your tax return in 2021. The credit is figured like the EIP, except the amounts are based on tax year 2020, instead of tax year 2019 or 2018 information. The … Read More
Owners of closely held corporations are often interested in easily withdrawing money from their businesses at the lowest possible tax cost. The simplest way is to distribute cash as a dividend. However, a dividend distribution isn’t tax-efficient, since it’s taxable to you to the extent of your corporation’s “earnings and profits.” And it’s not deductible … Read More
Happy Thanksgiving from our family to yours! Wishing you good food and great company today and always. Best, Mike & Team
The IRS has added two questions and an answer to its website regarding receipt of an Economic Impact Payment (EIP) by a deceased individual: Does someone who died qualify for the payment? Why did the IRS send payments to deceased individuals? The IRS answered: No, a payment made to someone who died before receiving it … Read More
Although planning is needed to help build the biggest possible nest egg in your traditional IRA (including a SEP-IRA and SIMPLE-IRA), it’s even more critical that you plan for withdrawals from these tax-deferred retirement vehicles. There are three areas where knowing the fine points of the IRA distribution rules can make a big difference in … Read More