Tag: accounting help

The Household Employee Problem

The Household Employee Problem

This often overlooked bookkeeping and payroll tax requirement can cause a tangle of tax problems if not handled correctly. It ended a run for Congress by Caroline Kennedy (JFK’s daughter) and killed a U.S. Attorney General nominee’s chances for appointment. Could you be impacted? This is what you need to know. Nanny Tax Explained In an effort to capture income…

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Five Big Tax Mistakes

Five Big Tax Mistakes

Every year taxpayers are hit with tax surprises that could be avoided if they just knew the rules. Here are five big ones that are easy to avoid with some simple planning. Mistake #1. Withholding too little. This results in a tax surprise when filing your income tax. Don’t be too hard on yourself if this happens to you. Social…

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14 year-end tax tips

14 year-end tax tips

The earlier the better when it comes to adopting a strategy to reduce your taxes. But even if time gets away from you, there are some year-end actions you can take to cut your taxes. Here are some last-minute tax cutters you might consider: 1. Review income and deductions. It’s all in the timing. The most fundamental year-end tax moveis…

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How to Defend Your Deductions

How to Defend Your Deductions

When faced with questions on your tax return deductions, it is getting all too common for tax authorities to deny everything and then make you prove that your deductions are valid. Do not let this happen to you. Here are some suggestions. The one-two punch To prove your deduction most auditors are looking for two key documents. Miss one of…

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Financial Basics: Buy the Right Insurance

Financial Basics: Buy the Right Insurance

To keep your insurance costs down, don’t buy insurance to pay for every small medical bill, auto repair, or financial loss. Build a savings account to handle life’s small financial inconveniences. Think of insurance as protection against catastrophes. You can lower your insurance premiums significantly by taking larger deductibles. Also, look for comprehensive insurance, not coverage for one specific event.…

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Cut Taxes With Lifetime Giving

Cut Taxes With Lifetime Giving

If you want certain individuals to receive property from your estate, there may be advantages to making those gifts while you are still alive. Consider these facts about making lifetime gifts: Gifts to spouses. The tax law permits a married individual to make gifts of any amount to a spouse without incurring any gift tax. The value of these gifts is…

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Tax strategies for homeowners

Tax strategies for homeowners

Be aware that important tax consequences are often associated with some fairly common events involving your home. Here are some handy things to know. Home purchase. When purchasing a home, you may pay a portion of the mortgage interest in advance. This loan origination fee, or “points,” is a percentage of the total amount borrowed. If points are paid for…

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Protect Your Privacy in 5 Simple Steps

Protect Your Privacy in 5 Simple Steps

Do you use a smart phone, tablet, or desktop computer to connect with friends and make purchases, as well as share health concerns with your doctor? If so, your privacy may be at risk. Companies called “data brokers” routinely compile information about your habits and preferences, including your favorite brands, recreational pursuits, and credit habits. Data brokers use this information…

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Conquer your financial clutter

Conquer your financial clutter

Financial records are notorious for being messy. Bills, paycheck stubs, tax returns and bank statements have a way of getting tucked into random places. Luckily, there are a few pretty painless ways to organize your important documents.   Put all your financial records in one dedicated spot To ensure that bills are paid on time, bank statements are reconciled and…

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Tax planning is good for corporations too

If you own a calendar-year corporation, you can benefit from planning moves you make before December 31.  For example, corporations can accelerate or defer income or deductions to stay within a certain tax bracket.  You’ll also want to look at your corporate alternative minimum tax exposure to determine whether you qualify for an exception to the tax.  Finally, reviewing estimated…

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A Quick Recordkeeping Guide

Is your cabinet overflowing?  Do you hesitate to purge tax information because you’re not sure what to keep and what to discard?  Here’s a quick guide to help you cut through the clutter. Expenses.  Substantiation for deductions includes charitable donation acknowledgments, receipts for employee business expenses, and automobile mileage logs.  Retain these at least seven years after you file the…

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Don’t overlook above-the-line deductions

Even if you don’t itemize deductions on your tax return, you may be entitled to certain “above-the-line” deductions.  These deductions are subtracted from your income to arrive at your adjusted gross income, an important number because it determines your qualification for certain tax credits and various tax breaks.  Above-the-line deductions include such things as IRA contributions, health savings account contributions,…

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Summer job tax tip

If your child has a summer job, consider opening an IRA for him or her.  According to the tax rules, anyone under age 70 1/2 who has earned income can contribute to a traditional IRA.  There’s no age restriction for Roth accounts, though the amount of the contribution phases out at higher income levels.  The advantage of a Roth over…

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Midyear tax planning tip

Take time this summer to examine your investment portfolio for potential tax savings, such as selling stocks that are worth less than you paid to offset your capital gains.  You might also donate appreciated stock that you have held for more than one year to charity and avoid capital gains altogether – plus getting a deduction for the stock’s fair…

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IRS launches new “misclassification initiative”

How you classify your workers – as “independent contractors” or “employees” – matters a great deal to the IRS.  The IRS is aware that employers prefer to treat workers as independent contractors to avoid paying fringe benefits and payroll taxes.  The IRS estimates that 80% of workers who are classified as independent contractors are actually employees.  About 100 new auditors…

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Filing deadline extended in 2016

Next year, taxpayers will get a few extra days to file their 2015 income tax returns.  The District of Columbia will be observing Emancipation Day on April 15, 2016, the usual filing deadline.  Because April 16 and 17 fall on a weekend, the 2016 filing deadline is moved to the next business day which is April 18.  Taxpayers in Maine…

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Year-End Tax Strategies for Businesses

YEAR-END TAX STRATEGIES FOR BUSINESSES Gift shares of stock to family members who are in a low tax bracket before declaring a dividend, as part of a larger plan to shift ownership of the business to younger family members. The owners of pass-through entities, such as S corporations and partnerships, have the income taxed on their personal tax returns.  The…

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IRS Impostors Phishing for Personal and Financial Information: Report them immediately

It is important to be aware of pop-ups or emails ‘phishing’ for personal information. They are transmitted electronically and done so very easily. You may even receive a text, SMS message or a personal message through social media platforms. These false requests are daily occurrences and are sent in hopes to lure innocent victims into disclosing personal and/or financial information.…

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