Tax Tips and Updates



Tax Tips & Updates - Small Business and Individuals



Tax Extensions Corporations

Business Partnerships Tax Filing

Business Partnerships Tax Filing Penalties

Deducting Entertainment Expenses

Deducting Travel Expenses

Donation Tax Laws

Earned Income Credit Increases

  • Wyoming Corporation Tax

    Wyoming Corporation Tax - Wyoming ranks 7st in the State Business Tax Climate Index, which measures the impact on business of five major elements of the tax system: the percentage of income taken by all taxes, the individual income tax rates, the corporate income taxes, the sales tax rate, and the complexity of the tax system.


  • Donation Tax Laws

    Donation Tax Laws - Tax breaks for charitable gifts provide rewards for both donors and their favorite nonprofit groups. In 2006, however, lawmakers decided some taxpayers had been pushing the envelope a bit too far. .


  • Kiddie Tax Laws

    Kiddie Tax Laws - In order to save for their child's college costs, parents open accounts in the child's name. Not only does this designate the fund for the youngster's use, but it also had the tax advantage of having the earnings taxed at the youth's usually lower rate. That changed in 2006.


  • 1031 Tax Exchange

    A 1031 tax exchange is an exchange in which capital gains tax deferral is possible to real estate owners who sell their investment, rental, business or vacation real estate, and reinvest the net proceeds in other real estate. Real Estate held for these purposes are called 1031 properties. Sometimes they are called like kind sales.




  • Section 179 Tax Deduction

    With the Section 179 Deductions property for business has a useful life of more than one year, the cost must be spread across several tax years as depreciation with a portion of the cost deducted each year.

    But there is a way to immediately receive these income tax benefits in one tax year. The provisions of Internal Revenue Code Section 179 allow a business, sole proprietor, partnership or corporation to fully expense tangible property in the year it is purchased.


  • 401K Tax Deduction

    A 401k is a defined contribution retirement plan that allows employees to have part of their pre tax pay deducted from their paycheck and put into an account that will be held tax exempt until such time as the money is actually used. In some cases, the employer agrees to match each dollar that the employee contributes to the 401k plan, up to a certain percentage that the employer determines, with a contribution to the account. There are two basic types of 401k plans, a bonus or profit-sharing plan, and a thrift plan.


  • 529 Plan for Savings

    A 529 Savings Plan for education is a state-sponsored program designed to help finance education expenses. Section 529 plans are administered by certain investment companies and subject to contribution requirements and investment guidelines. Withdrawals from the account are taxed at the child's tax rate, and anyone can contribute to a Section 529 plan, regardless of their income level. Within the 529 Plan, the money can be invested in a portfolio of various types of investments, such as stocks, bonds,mutual funds or a combination of all. Most states offer Section 529 plans. The proceeds can be used only for education purposes. Withdrawals for non-educational purposes trigger taxes and a 10% penalty. The investment company administering the account will be in control of how the money is invested, and will charge an ongoing fee for its services.


  • In 2001, after ten years of debate, Congress passed legislation that will repeal the federal estate tax, a tax imposed on the assets left by the nation's residents and many Small Business Owners. The full repeal, however, will not take place until 2010, and it is possible that Congress could revive the tax in some form before then. And in 2011, the estate tax will come back unless Congress votes to extend the repeal. Meanwhile, though, estate tax rates will go down and exemptions will go up.

  • Health Savings Account

    A health savings account is a new tax exempt health account. Under a health savings account employees or the self employed can accumulate pre-tax savings inside their health savings account for smaller expenses such as co-payments, non-covered health services, or medical services before the deductible are met.


  • Audit Proof Tax Returns

    Audit-proofing techniques can be used effectively to prevent audits, penalties and the wasting of time. The techniques are simple, and should be used especially since the IRS produces a special audit-proofing form you can use. Form 8275. Audit-proofing is based on the principal of providing with your return the information relevant to a claim in your return. You provide information for claims you think could raise a red flag and cause an audit.


  • Small Business Deductions

    The cost of doing business is an important part of calculating your Small Business Tax Deductions and/or your Home Business Tax Deductions. Use this checklist to ensure that you're maximizing your income tax deductions in this category of business expenses.


  • Donating Cars Tax Benefits

    Are you thinking of selling or trading in that old car, boat or RV? Why not donate the car or veheicle instead? As a charitable contribution your donation of a car could make a big difference.

    Designated charities are able to accept most cars and vehicles running or not (exceptions include older cars and vehicles whose value would not offset the cost of towing). Most organizations will make arrangements to conveniently and quickly pick up your car donation at no cost to you. The charitable organization will handle the car title transfer requirements and provide you with a tax deductible car donation receipt at the time of pick up.


  • The Health Coverage Tax Credit (HCTC)

    The Health Coverage Tax Credit (HCTC) is a program that can help pay for nearly two-thirds of eligible individuals' health plan premiums. To be eligible, taxpayers must be enrolled in a qualified health plan, which includes COBRA, state-qualified health plans, or if the taxpayer is enrolled under a spouse's work plan and pays more than 50 percent of the total health care costs.


  • Home Business Tax Deductions

    "It's not how much you make ,it's how much you keep." Take advantage of the Home Business Tax Savings, savings and Tax deductions for Your Home Business.

    Whether you are self employed or are an employee, you may be able to deduct certain expenses and/or cost for a part of your home, which is used for your home business.


  • LLC and Paying Taxes to the IRS

    LLC and Taxes- An LLC is not a separate tax entity like a corporation; it is what the IRS calls a pass through entity, like a partnership or sole proprietorship. All of the profits and losses of the LLC pass through the business to the LLC owners, who report this information on their personal tax returns. The LLC itself does not pay federal income taxes, but some states do charge the LLC itself a tax.


  • Offer in Compromise - OIC

    An offer in Compromise is when you receive a notice from the IRS that you owed them a lot of money and perhaps they are threatening to take your home or garnish your wages.However you cannot come close to paying what they say you owe. AND, the IRS is demanding a payment for the entire amount owed.


  • Offer in Compromise - Qualifications

    Before you can file an Offer in Compromise, all due tax returns must be filed. There is simply no way to assess how much to offer if you do not know how much you really owe. The IRS may assess what you owe, even if you do not file. However, when the IRS assesses taxes for un-filed years, they do not take into consideration any deductions or other tax breaks you may be eligible for.


  • Reduce Taxes

    In 2001, the tax laws were changed to lower the tax rates across the board and create a new 10 percent income rate. Beginning in 2003, the Jobs and Growth Tax Relief Reconciliation Act of 2003 accelerates further tax rate reductions that were to take effect in 2006.


  • New Sales Tax Deduction Option

    The American Jobs Creation Act of 2004 provides taxpayers with the option to claim state and local sales taxes instead of state and local income taxes when itemizing deductions. The sales tax deduction option is only available for the 2004 and 2005 fiscal years.


  • Self Employment Tax

    However, Self Employment Tax is a much larger amount than what comes out of your paycheck as an employee. As an employee, 7.65% is deducted from your pay. The Self Employment Tax amount you will pay is almost twice what you pay as an employee. The reason for this is that your employer matches what comes out of your check so that 15.3% actually gets paid in to the Social Security Administration on your behalf. When you are self-employed, you are essentially both the employee and the employer. Since there is no one else to pay the other half for you, you get to pay them both. You do get a couple of breaks so that the amount is not quite double. We'll get to that in the computation section.


  • Tax Extensions for Corporations

    If you conduct business as a corporation with a fiscal year-end of December 31st, you are required to file your 2004 tax returns on or before March 15, 2005. You can get an automatic extension, however, by filing form 7004 before the March 15 deadline. Form 7004 applies both to "C" and "S" corporations and grants you an automatic 6-month extension to September 15, 2005.


  • Tax Benefits and Savings

    Congress wants to encourage taxpaying Americans just like YOU to have a home-based business because it is good for the overall U.S. economy. So, they passed legislation that allows you HUGE tax breaks if you do. They'll even let you take tax deductions on losses from your home-based business.


  • Tax Software Solutions

    Most of the best resources for tax software can be found on the internet. The initial step is to decide what your tax software needs are. You then will need to locate a tax software package that provides all of the features and functionality that you are looking for.


  • Vehicle Donations and The New Tax Law

    Under the new law, allowable deductions for charitable contributions of vehicles, boats and airplanes (collectively referred to as "assets" in this summary) for which the claimed value exceeds $500 will depend how the asset is used by the recipient charity. If the organization sells the asset without any significant intervening use or material improvement, the donor’s deduction is limited to the gross sales proceeds received by the charity. But, if the organization uses the asset in direct furtherance of its charitable purpose the donor may deduct the "fair market value" of the asset. (According to the IRS, the donor, not the recipient charity, must determine the "fair market value" which the IRS describes as the price that a willing buyer and willing seller would agree upon if neither were pressured to do so.


  • W2 - Employee vs 1099 - Independent Contractor

    For most of us the actual difference between 1099 Independent Contractors and W-2 Employees is clear cut for several reasons. But there are many of us out there that have never encountered it or never even thought to discover and understand their differences. In this article, I will convey to you the proper and necessary information so that you may determine which situation is best suited for you.


  • Business Partnerships Tax Filing

    Business Partnerships Tax Filing - Every partnership that engages in a trade or business or has gross income must file an information return on Form 1065 showing its income, deductions, and other required information. The partnership return must show the names and addresses of each partner and each partner's distributive share of taxable income. The return must be signed by a general partner. If a limited liability company is treated as a partnership, it must file Form 1065 and one of its members must sign the return.


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