Hello friends. As the world gets more and more chaotic every day, I have been thinking about the recent passing of friends and family members. Not everybody wants to talk about life insurance, but we all will leave this world one day. Life happens, and we should all be prepared. Whether it’s funeral expenses or income protection for your family and loved ones, this is a conversation that you should have with your insurance advisor sooner rather than later. So are you in need of life insurance?
To talk to an independent licensed insurance advisor, contact us today!
Business expenses are the cost of carrying on a trade or business. Deductible business expenses (business deductions) are those that are ordinary and necessary which were paid (cash basis) or incurred (accrual basis) during the year. An ordinary expense is one that is common and accepted in your trade or business. A necessary expense is one that is helpful and appropriate for your trade or business.
Business deductions are usually tax deductible if the business operates to make a profit. Tax deductions are valid business expenses that you claim on your taxes. Claiming these business deductions saves you money by… Continue reading
If it’s been a rough number of years for you recently, you’re not alone. Many Americans lost their homes to foreclosure following the 2008 financial crisis. Even today, many Americans are still facing foreclosure action or are unable to sustain paying their bills. If you experienced this, I am sure you are hoping the worst is behind you…. But to add insult to injury, if you went through foreclosure, had a short sale of your house or simply had a balance forgiven on a credit card, then you most likely will be receiving a 1099-C – Cancellation Debt Income form… Continue reading
S Corporation shareholders often come up with a plethora of questions when deciding what to pay themselves and trying to figure out their S Corporation reasonable salary as owners. As tax advisors, we often find ourselves answering most of these questions, especially when it comes to determining ‘reasonable compensation’.
The instructions to Form 1120S, U.S. Income Tax Return for an S Corporation, state “distributions and other payments by an S corporation to a corporate officer must be treated as wages to the extent the amounts are reasonable compensation for services rendered to the corporation.” Furthermore, the IRS states that “S… Continue reading
Early Distributions from Retirement Plans: What to know
Whether it’s a 401(k) or IRA; if you need to access your qualified retirement funds prematurely, you will likely pay a stiff penalty.
If you take a distribution from your retirement plan early (meaning before the day you turn 59 1/2) you will generally have to pay a 10% early distribution tax above and beyond any regular income taxes you may owe on the withdrawal, which is included in your taxable income. That extra 10% might be called a tax, but in reality it is just an early withdrawal penalty. In fact,… Continue reading
Received an IRS Notice? Here’s what to do.
Each year the IRS sends millions of letters and notices to taxpayers. Although some people may feel anxious when they receive one, many are able to be resolved. Here’s what to do if you receive a letter or notice from the IRS:
1) There are many reasons the IRS sends notices to taxpayers. The notice usually covers a specific issue about your account or tax return. It may request payment of taxes, notify you of a change to your account or ask for additional information.
2) Don’t panic. Follow the instructions in… Continue reading
Tax implications of a C Corporation converting to an S Corporation
There are basically two tax options for a corporation. A regular corporation (or C corporation) pays tax on its earnings at the corporate level. Then, a second tax is paid when those same earnings are distributed as dividends to the shareholders. This system of double taxation is precisely the reason why many people choose S corporation status, as S Corporations pay no tax on their own at the corporate level. Rather, the S corporation income flows through to the shareholders, and they pay the tax personally at the individual… Continue reading
With April 15th right around the corner, we are here to assist you in getting your tax return or extension filed!
Q: Let’s get everyone on the same page – what is the actual deadline for filing your taxes?
A: You have until Wednesday, April 15th to send in your tax return. Whether you are filing by snail mail or online, remember your return must be postmarked or time-stamped by 11:59 pm. I recommend my clients file their returns electronically. That will help you avoid long lines at the post office, and if you’re expecting… Continue reading