Your husband-and-wife business may already be a success. That’s great. Now, with a little tax planning for the husband-and-wife business, you can increase your after-tax profits and sleep better at night knowing that your business form is good.

New guidance from the IRS on the new health care law says the owner of a business (proprietorship, corporation, LLC, etc.) may not claim the 35 percent tax credit on the health insurance premiums paid to cover his or her spouse.

The new health care law grants a nice tax credit to business owners who cover their employees. How about the owners themselves? Lawmakers did them no favors, but one group of proprietors might catch a break.

Tax law favors the son or daughter working for the mother or father in a proprietorship or husband and wife partnership. If you operate your business as a corporation, you also can come out ahead by hiring your child.

Having your child work in your business produces college funding strategies with both the Roth and the traditional IRA. As an added bonus, you can use the traditional IRA with earned income to eliminate some kiddie tax.

The woman in this audit learned how knowledge can turn what appears as a nightmare (an IRS audit) into a positive happening—meaning cash refunds for the year of the audit and subsequent years. As the old sayings goes, “knowledge is power.”

The Heineman case gives a roadmap to how a husband and wife might deduct the cost of attending a board of directors meeting where they are the only participants. Using the principles enunciated in Heineman, husband-and-wife corporate owners will find deducting the out-of-town board meeting easier than deducting board meetings that occur in town.

Use this Section 105 medical reimbursement plan template to make sure you provide maximum medical benefits to you and your family while legally discriminating under both tax law and ERISA rules.

You are talking to yourself (for tax purposes) when you discuss business with your husband over dinner. This is a nondeductible experience.

When husband and wife receive individual 1099s from the same firm, they generally can improve their after-tax cash results by having one spouse earn the 1099 income and having the other spouse work as an employee.

In an ISP, the IRS asserted that the Section 105 medical reimbursement plan may not reimburse the employee-spouse for the cost of health insurance purchased in the employee-owner’s name. This court case held that this IRS position is wrong and that the owner may deduct the cost of medical insurance purchased in his name when that insurance is covered by the Section 105 medical reimbursement plan.

Answering “yes” to the 11 puts you on the road to audit-proof status for your Section 105 medical reimbursement plan.

The husband and wife who work together must consider the joint venture election if they want the business treated by the IRS the way they think it should be treated.

The combination of a Section 105 medical plan and a $15,500 salary to the spouse generated a $32,875 tax deduction for the business, no taxable income for the spouse, and a cash contribution to the spouse’s 401(k) retirement account of $19,375.

The new Iraq war funding law contains a new tax law section on “family business tax simplification.” If you and your spouse work together in the business, it is time to pay attention and examine this new law.

As owners of an S corporation, you probably are allowed to forego the stockholders’ and directors’ meetings. However, you may not want to. By skipping these meetings and other “corporate” activities, you appear less like a corporation in the eyes of the law.

Incorporated and unincorporated businesses can use the solo 401(k) to benefit the owner (including a husband and wife). In most cases, the solo 401(k) allows the one-owner or husband-and-wife owners to put away more than they could in other plans (up to $49,000 this year, depending on age and earnings—adjusted for inflation in future years).

To treat your rental property as a tax shelter and deduct your rental property losses against non-passive income, you first need classification as a real estate professional and then you need material participation on the individual properties, or if grouped, on the group. Good and proper tracking of time spent by you and, if married, your spouse is required to prove both your real estate professional status and material participation.

When the husband and wife work together in the business, but report that business on one Schedule C, they create a tax problem for themselves. Is this a partnership or joint venture where both husband and wife have earned income subject to self-employment taxes? You can avoid this problem by hiring the spouse not reporting on a Schedule C. You then can avoid payroll taxes on the wages to the employee-spouse by making the compensation non-W-2 income.

The expansion of the kiddie tax to children under the age of 18 has zero negative effect on the hire-your-child strategy.

The one-owner or husband-and-wife owned businesses can gain significant income by learning how to reduce the largest expense they pay during their lifetimes (taxes). In this respect, the self-employed are both cursed and blessed. Cursed because they pay a larger percentage of their net income in taxes than anyone else in the country. Blessed with business deductions that, when used properly, not only balance their taxes with those of the average employee, but actually mean (if they are paying attention) that they pay a whole lot less.

The IRS fulfilled its promise and audited twice as many Form 1040-Schedule C taxpayers and S corporation returns. Your odds of audit vary by both choice of entity and gross receipts in that entity.