Harless Tax Blog
Know your rights
For any type of audit, professional assistance can be valuable. Indeed, you’re entitled to have a CPA, an attorney, or an enrolled agent represent you at an office or a field audit. In such a situation, it may be possible for the audit to take place at your CPA’s office.
You also can receive help in requesting a postponement, if you need time to gather your records. If you must be present during the audit, you should answer all questions accurately, but there’s no need to volunteer any information that the IRS does not request. If an appeal of IRS findings seems warranted, your CPA can handle that as well. See More
Employers. For Social Security, Medicare, and withheld income tax, file Form 941 for the first quarter of 2017. This due date applies only if you deposited the tax for the quarter in full and on time.
Employers. For Social Security, Medicare, withheld income tax, and nonpayroll withholding, deposit the tax for payments in April if the monthly rule applies. See More
Tax season can be one of the most stressful times of the year for business owners. However, it's necessary if you want to avoid audits or getting penalized by the IRS.
But, tax season is also beneficial for business owners since it can help you deduct certain expenses, which means that you can reduce your overall tax burden.
To make sure that you don't leave any money on the table, here are the best deductions for small businesses to write-off this upcoming tax season. See More
The average published cost for tuition, fees, room and board at private nonprofit colleges and universities is $45,570 in the 2016-17 academic year. At public institutions, that average cost is $35,370 for out-of-state students, while state residents pay $20,090, on average. Financial aid and tax benefits may reduce the actual cost of higher education. See More
Among employer-sponsored retirement plans, 401(k)s have become the standard. Some prospective employees assume that a job will come with a 401(k). Therefore, offering a 401(k) at your company may help you hire desired workers, and help you retain valued employees.
That said, there can be drawbacks to sponsoring a traditional 401(k). Such plans require annual testing to ensure that a 401(k) does not discriminate in favor of highly compensated employees, including owner-employees. Failing such a test may limit the amount that company principals and certain others may contribute to the plan, resulting in a reduced tax-deferred retirement fund for key individuals.
One solution is to offer a safe harbor 401(k) for your small business. A study released in late 2016 by Employee Fiduciary, a 401(k) provider for small businesses, found that 68% of the small firms responding to the survey use a safe harbor 401(k) plan design to avoid annual nondiscrimination testing. A safe harbor 401(k) allows sponsoring companies to avoid these tests, providing the business makes certain contributions to employees’ accounts. The mandatory employer contributions are always 100% vested. See More
Medicare, the federal government’s health insurance program for people 65 and older, has four parts (see Trusted Advice, “ABCDs of Medicare”). Although Medicare offers good value to many seniors, high-income Medicare enrollees can pay over $5,000 a year for Part B, whereas high-income couples on Medicare can pay over $10,000 in annual premiums. For that money, high-income enrollees get the same Medicare coverage that most seniors get for about $1,300 a year, or $2,600 for couples.
Medicare Part B, which covers doctor visits and some other medical outlays, charges a monthly premium. Most enrollees have that premium deducted from their Social Security deposits, paying around $109 a month in that manner. (The “standard” amount, paid by some enrollees, is $134 a month in 2017, about $1,600 a year.) However, in 2017, seniors with certain levels of income will pay more, with premiums increasing as income tops certain thresholds. See More
Source CCH Tax Group. Read Original Article
President Trump released his much-anticipated 2018 budget blueprint, also known as a “skinny” budget, on March 16. The budget blueprint calls for a reduction in IRS funding by $239 million for the next fiscal year (FY) 2017-2018, including an overall funding reduction of $519 million, or 4.1 percent decrease, for the Treasury from current levels. “The Budget will bring renewed discipline to the Department by focusing resources on collecting revenue, managing the Nation’s debt, protecting the financial system from threats, and combating financial crime and terrorism financing,” the blueprint states.
According to the budget blueprint, the proposed reduction of the IRS budget by $239 million would be made in conjunction with savings accrued from diverting resources from “antiquated operations.” The blueprint states that the budget proposal preserves key operations of the IRS, including combating fraud and identity theft, as well as the enforcement of tax laws. See More
As of this writing, major U.S. stock market indexes are at or near record highs. This bullish run might continue...or it might end with a severe slide. Here are some strategies to consider.
Stay the course Many investors will prefer to keep their current stock market positions. For nearly a century, every stock market reversal has been followed by a recovery. Even the severe shock of late 2008 through early 2009 has led to new peaks, less than a decade later. See More
Partnerships. File a 2016 calendar-year return (Form 1065). Provide each partner with a copy of Schedule K-1 (Form 1065), Partner’s Share of Income, Deductions, Credits, etc., or a substitute Schedule K-1. If you want an automatic six-month extension of time to file the return and provide Schedule K-1 or a substitute Schedule K-1, file Form 7004. Then file Form 1065 by September 15.
S corporations. File a 2016 calendar-year income tax return (Form 1120S) and pay any tax due. Provide each shareholder with a copy of Schedule K-1 (Form 1120S), Shareholder's Share of Income, Deductions, Credits, etc., or a substitute Schedule K-1. If you want an automatic six-month extension of time to file the return, file Form 7004 and deposit what you estimate you owe. See More