What kind of business is a mom-and-pop operation? It’s probably not a question you pondered when you dreamed of going into business. Suppose you employ your child. How is this handled so that you are in compliance with IRS rules and regulations? Payments for a child under age 18 aren’t subject to Social Security or Medicare taxes if the…
Read MoreIn general, individual and trust income tax returns are due on April 15th of each year, while partnerships and corporations must file by March 15th. If your accountant thinks there is a reasonable chance that you will not be able to file your tax return on time, they will file an automatic request for extension with…
Read MoreDeath doesn’t cancel a final responsibility: paying income taxes. A decedent’s executor must file one last income tax return for the deceased if the deceased’s income surpassed a certain threshold. And even if a return isn’t required, a return may be necessary anyway to obtain a refund. The executor must take into account all the…
Read MoreWhen you sell a capital asset—property owned and used for personal or investment purposes, let’s say—the sale will result in either a capital gain or a capital loss. You report that gain or loss on Schedule D of Form 1040. The capital assets you’ll most likely report on Schedule D are stocks, bonds, and homes…
Read MoreCan you deduct medical and dental expenses? That’s a complicated question. To start with, your deductions must exceed 7.5 percent of your adjusted gross income. And they must fall into an IRS-approved category. Deductible medical expenses may include, but aren’t limited to, the following: Payments of fees to doctors, dentists, surgeons, chiropractors, psychiatrists, psychologists, and…
Read MoreThe IRS has updated some rules for deductible expenses, as guidance in areas that may have been murky as a result of the Tax Cuts and Jobs Act (TCJA). The rules being updated involve using optional standard mileage rates when figuring the deductible costs of operating an automobile for business, charitable, medical, or moving expense purposes, among…
Read MoreIn an effort to boost the production of U.S. goods, the 2017 Tax Act introduced a Foreign Derived Intangible Income (FDII) deduction for tax years 2018 and beyond. But despite the deduction representing a significant reduction in tax rates, the benefit remains under-utilized. If your corporation exports goods or sells services outside of the U.S.,…
Read MoreIn order to help taxpayers avoid scams in which criminals impersonate IRS employees, IRS has issued a Fact Sheet in which it sets out the ways that it does and does not contact taxpayers. Here are various ways that legitimate IRS employees contact taxpayers. IRS initiates most contacts with taxpayers through regular mail delivered by…
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