Big Changes Coming for Investors in 2013

• Posted on April 24, 2012

2013 will bring some big changes for investors, and none of them for the better. Taxpayers affected by these upcoming changes may wish to consider taking actions in 2012 to mitigate the impact of these changes. The following are the changes that will affect investors in 2013.
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Is Your Child a Full-Time Student?

• Posted on April 24, 2012

If you have a qualified child you can claim an exemption for that child on your tax return, which results in a $3,800 deduction for 2012 (up from $3,700 in 2011). Depending upon your tax bracket, that deduction can produce a substantial tax savings. To be treated as a qualified child, a child must be under the age of 19 or a full-time student under the age of 24.
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Is Your Hobby a For-Profit Endeavor?

• Posted on April 24, 2012

The tax treatment for a hobby is substantially different than it is for a business, which sometimes makes it difficult to distinguish one from the other. The IRS provides appropriate guidelines when determining whether an activity is engaged in for profit, such as a business or investment activity, or is engaged in as a hobby.
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How Business Website Expenses Are Deducted

• Posted on April 24, 2012

With the explosion of online businesses, one would think that there would be a standard method of deducting the cost of your business website. But some questions still exist as to what part of a website is considered software, and to date, the IRS has not fully clarified that issue for tax purposes.
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Cutting Expenses Key To Profitability, But How? Some Tips

• Posted on April 24, 2012

It may seem like a no-brainer – cut expenses to make more money – but many small changes can result in significant savings.
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Can’t Pay Your Taxes by the April Due Date?

• Posted on March 26, 2012

The vast majority of Americans get a tax refund from the IRS each spring, but what if you are one of those who end up owing?
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Are You an Employee or an Independent Contractor?

• Posted on March 26, 2012

The distinction has significant implications for both the employer and the employee. Employers like to treat individuals as independent contractors because they avoid having to match the employees’ payroll tax, pay benefits, pay unemployment insurance, etc. This results in a significant savings for employers.
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Penalty Relief for Financially Distressed Taxpayers

• Posted on March 26, 2012

The IRS has new penalty relief for the unemployed and certain self-employed individuals on failure-to-pay penalties, which are one of the biggest factors a financially distressed taxpayer faces on a tax bill.
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Individual Estimated Tax Payments for 2012 Start Soon

• Posted on March 26, 2012

Our tax system is a “pay-as-you-go” system, and if your pre-paid amount is not enough, you become liable for non-deductible interest penalties. To facilitate that concept, the government has provided several means of assisting taxpayers in meeting the “pay-as-you-go” requirement. The primary among these include:
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Tax Tidbits

• Posted on March 26, 2012

From time to time issues related to taxes arise that are interesting, informative or humorous that is not directly related to the preparation of a tax return but are related issues associated with federal taxation.
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Billing for Time and Expenses: How It Works

• Posted on March 26, 2012

QuickBooks handles billable expenses capably, but it's critical that you understand the process thoroughly before proceeding.
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Using Direct Deposit is a Smarter Option for your Refund.

• Posted on February 22, 2012

Want your refund faster? Have it deposited directly into your bank account. More taxpayers are choosing direct deposit as the way to receive their federal tax refunds. More than 79 million people had their tax refunds deposited directly into their bank accounts in 2011. It’s a secure and convenient way to get your money in your pocket faster.
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Recently Enacted Tax Breaks for Small Businesses

• Posted on February 22, 2012

Keeping track of tax changes these days is quite a task. Congress is constantly tweaking the tax laws in an effort to stimulate the economy and deal with the budget deficit. The following is a compilation of recent changes to keep you up date.
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Good News – Payroll Tax Cut Extended through 2012!

• Posted on February 22, 2012

Congress gave all wage earners a short-lived 2012 reprieve by temporarily extending the 2% payroll tax cut though February of 2012.
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Reporting Stock Transactions Becomes More Complicated

• Posted on February 22, 2012

Beginning with the 2011 tax return, reporting stock transactions has become significantly more complicated because of the new requirement for brokerage firms to track the purchase price of stocks acquired in 2011 and subsequent years and to include that information on the information-reporting document 1099-B.
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1099-K Business Return Reconciliation Eliminated

• Posted on February 22, 2012

The Housing and Economic Recovery Act of 2008 required third-party payment entities, such as credit card companies, to begin filing informational returns with the IRS reporting merchant card transactions, such as credit and debit card payments. The purpose was to give the IRS the ability to match a business’s credit and debit card sales with the amount the business reported on their tax return.
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Charity Purchases and Auctions

• Posted on February 22, 2012

A regular form of fundraising by charitable organizations consists of sales or auctions of property or services at a price in excess of value. These are referred to as “quid pro quo” contributions or dual payments made that consist partly of a charitable gift and partly of consideration for goods or services provided to the donor.
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New Reporting Requirement for Individuals with Foreign Financial Assets

• Posted on January 24, 2012

New for 2011 is a requirement for any individual who, during the tax year, holds any interest in a “specified foreign financial asset” to complete and attach Form 8938 to his or her income tax return if a reporting threshold is met. The reporting threshold varies depending on whether the individual lives in the U.S. and files a joint return with his or her spouse. For example, someone who is not married and doesn’t live abroad will need to file Form 8938 for 2011 if the total value of his or her specified foreign financial assets was more than $50,000 as of December 31, 2011, or more than $75,000 at any time during 2011. For married taxpayers filing a joint return and living in the U.S., the threshold amounts are doubled. The thresholds also are higher for taxpayers residing abroad.
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Those Gold Sales May Be Taxable

• Posted on January 24, 2012

If you took advantage of the escalating gold and silver prices and made any sales of gold, silver, gems, jewelry, or the like during 2011, you are required to report the sales on your tax return. Whether or not the sales are subject to tax, and at what tax rate, depends upon the type of item sold and your tax basis for the item.
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Schedule Cs in the IRS' Bull's-eye

• Posted on January 24, 2012

Schedule C is the form that unincorporated sole proprietor businesses use to report their income and expenses as part of their individual tax returns. Schedule Cs have been center stage in recent IRS “tax gap” estimates.
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Nominees Have 1099 Reporting Requirements

• Posted on January 24, 2012

Candidates seeking political offices aren’t the only individuals who are “nominees.” For tax purposes, if you receive, in your name, income that actually belongs to someone else, you are also a nominee. Being a nominee means you must file with the IRS a 1099 form appropriate to the type of income you received and give a copy of the 1099 to the actual owner of the income. However, if the other person is your spouse, no 1099 filing is required.
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It’s Not Too Late

• Posted on January 24, 2012

It’s not too late to make an IRA and/or SEP contribution or undo a Roth IRA conversion for 2011.
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QuickBooks Income Tax Reports And Filtering Options: Target The Right Output

• Posted on January 24, 2012

April 15 is getting uncomfortably close. QuickBooks, of course, can't do your taxes for you. But it helps you lay some of the groundwork. Following up on last month's column on customizing reports, we'll look at the program's tax-related reports and its powerful report-filtering options. 
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Are You Liable for a Gift Tax Return?

• Posted on December 26, 2011

Frequently, taxpayers think that gifts of cash, securities, or other assets they give to other individuals are tax-deductible and, in turn, the gift recipient sometimes thinks income tax must be paid on the gift received. Nothing is further from the truth. To fully understand the ramifications of gifting, one needs to realize that gift tax laws are related to estate tax laws.
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Are You Required to File 1099s?

• Posted on December 26, 2011

If you use independent contractors to perform services for your business and you pay them $600 or more for the year, you are required to issue them a Form 1099 after the end of the year to avoid facing the loss of the deduction for their labor and expenses and to avoid a monetary penalty. The 1099s for 2011 must be provided to the independent contractor no later than January 31, 2012.
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The IRS Is Attacking the Medical Marijuana Business

• Posted on December 26, 2011

Generally a business can deduct normal business expenses such as rent, payroll, etc. However, the IRS is using an obscure section of the code passed during the Reagan Administration as part of the “War on Drugs” to deny normal business expenses to medical marijuana-related businesses.
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2012 Standard Mileage Rates Announced

• Posted on December 26, 2011

The Internal Revenue Service has issued the 2012 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical, or moving purposes.
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New Credits for Hiring Veterans

• Posted on December 26, 2011

Congress recently passed legislation that extends and expands the Work Opportunity Credit (WOTC) for hiring unemployed veterans. This effectively gave a one-year lease on life to the WOTC, but only with respect to qualified veterans who begin work for the employer before January 1, 2013. For all other classifications, the credit ended at the close of 2011.
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Modifying QuickBooks Reports Gives You Better Insight Into Past, Future: Part 1

• Posted on December 26, 2011

If you make one resolution about improving your accounting procedures in 2012, it should be this: Make extensive use of the tools that QuickBooks offers for report modification. Comprehensive, meticulously-shaped reports that flow out of your carefully-constructed records and transactions are your reward for pounding on the keys every day, conscientiously recording income and expenses.
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