Special Tax Benefits for Members of the Military

Special Tax Benefits for Members of the Military

Military personnel and their families face unique life challenges with their duties, expenses, and transitions. As such, military members may qualify for tax benefits not available to civilians. For example, they don’t have to pay taxes on some types of income. Special rules may lower the tax they owe or allow them more time to file and pay their federal taxes.

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Choosing the Correct Business Entity

Choosing the Correct Business Entity

One of the most important decisions you'll make when starting a business is choosing the right business entity. It's a decision that impacts many things--from the amount of taxes you pay to how much paperwork you have to deal with and what type of personal liability you face. Forms of Business The most common forms of business are Sole Proprietorships, Partnerships, Limited Liability Companies (LLC), and Corporations. Federal tax law also recognizes another business form called the S-Corporation. While state law controls the formation of your business, federal tax law controls how your business is taxed. What To Consider Businesses fall under one of two federal tax systems, and the first major consideration in choosing the form of doing business is whether to choose an entity that has...

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Estimated Tax Payments: The Facts

Estimated Tax Payments: The Facts

Estimated tax is the method used to pay tax on income that is not subject to withholding, including income from self-employment, interest, dividends, alimony, rent, and gains from the sale of assets, prizes, and awards. You also may have to pay estimated tax if the amount of income tax being withheld from your salary, pension, or other income is not enough. Filing and Paying Estimated Taxes Both individuals and business owners may need to file and pay estimated taxes, which are paid quarterly. The first estimated tax payment of the year is normally due on the same day as your federal tax return is due. This year, that date was April 18, 2022. For estimated tax purposes, the year is divided into four payment periods, and each period has a specific payment due date. For the 2022 tax year,...

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What To Do if You Missed the April Tax Deadline

What To Do if You Missed the April Tax Deadline

Monday, April 18, 2022, was the tax deadline for most taxpayers to file their tax returns, but if you haven’t filed a 2021 tax return yet, it’s not too late. Here’s what you need to do: First, gather any information related to income and deductions for the tax years for which a return must be filed, then call the office to set up an in-person or virtual appointment.

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Tax Tips for April 2022

Tax Tips for April 2022

Click on the links below to jump to each section in this article: File on Time Even if You Can't Pay What To Do if You're Missing Important Tax Documents Tax Credits To Help Cover Costs of Higher Education Small Business: Rent Expenses May Be Tax-deductible Taxpayer Rights: Pay No More Than the Correct Amount File on Time Even if You Can't Pay Generally, taxpayers should file their tax returns by the deadline even if they cannot pay the total amount due, but if you can't, there are several options. Let's take a look at a few scenarios: 1. An individual taxpayer owes taxes but can't pay in full by the deadline. If this is the case, file a tax return or request an extension of time to file by the April 18 deadline. If tax is owed and a return is not filed on time - or an extension is not...

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Cash Management Tips for Your Small Business

Cash Management Tips for Your Small Business

Cash flow is the lifeblood of every small business but many business owners underestimate just how vital managing cash flow is to their business's success. In fact, a healthy cash flow is more important than your business's ability to deliver its goods and services. While that might seem counterintuitive, consider this: if you fail to satisfy a customer and lose that customer's business, you can always work harder to please the next customer. If you fail to have enough cash to pay your suppliers, creditors, or employees, you are out of business. What is Cash Flow? Cash flow, simply defined, is the movement of money in and out of your business; these movements are called inflow and outflow. Inflows for your business primarily come from the sale of goods or services to your customers but...

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Got Debt? How To Improve Your Financial Situation

Got Debt? How To Improve Your Financial Situation

Being debt-free is a worthwhile goal; unfortunately, for most people, it is unrealistic - especially for those of pre-retirement age with children, a car payment or two, and a mortgage. As such, most people need to focus on managing their debt first since it's likely to be there for much of their adult life. With inflation on the rise (and subsequent interest rate hikes), your credit card debt could be even more difficult to pay off. Eliminating debt is especially crucial for anyone approaching retirement age. However, the good news is that when debt is handled wisely, you won't need to shell out every cent of your hard-earned money to your lender because of exorbitant interest rates or feel like you're always on the verge of bankruptcy. Here's how you can pay off debt the smart way...

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The Tax Consequences of Crowdfunding

The Tax Consequences of Crowdfunding

Crowdfunding websites such as Kickstarter and GoFundMe have become an increasingly popular way for small business owners to stay afloat. The upside is that it's often possible to raise the cash you need; the downside is that the IRS considers that money taxable income. Let's take a closer look at how crowdfunding works and how it could affect your tax situation. What is Crowdfunding? Crowdfunding is the practice of funding a project by gathering online contributions from a large group of backers. It was initially used by musicians, filmmakers, and other creative types to raise small sums of money for projects that were unlikely to turn a profit. More recently, it has been used to fund projects, events, and products and, in some cases, has become an alternative to venture capital....

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Reminder: Rules for Depreciation and Expensing

Reminder: Rules for Depreciation and Expensing

As part of final guidance issued that pertains to the Tax Cuts and Jobs Act of 2017, new rules and limitations are in effect for taxpayers who deduct depreciation for qualified property acquired after September 27, 2017. As a business owner, they could affect your tax situation. Let's take a closer look: Businesses Can Immediately Expense More Under Tax Reform A taxpayer may elect to expense the cost of any section 179 property and deduct it in the year the property is placed in service. These changes apply to property placed in service in taxable years beginning after December 31, 2017. As a reminder, the new law (ie., the Tax Cuts and Jobs Act of 2017) increased the maximum deduction from $500,000 to $1 million. It also increased the phase-out threshold from $2 million to $2.5 million....

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Tax Return Tips for Last-minute Filers

Tax Return Tips for Last-minute Filers

When it comes to working on your taxes, earlier is better, but many people find preparing their tax return stressful and frustrating and wait until the last minute. If you've been procrastinating on filing your tax return this year, here are eight tips that might help. Don't Delay Resist the temptation to put off your taxes until the last minute. Your haste to meet the filing deadline may cause you to overlook potential sources of tax savings and will likely increase your risk of making an error. Getting a head start (even if it is a week or two) will keep the process calm and mean you get your return faster by avoiding the last-minute rush. Gather Tax Documents in Advance Make sure you have all the records you need, including W-2s and 1099s. Don't forget to save a copy for your files....

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