The self-employed health insurance deduction could give you a big surprise when you file your taxes—and that’s not good. The law imposes a couple of restrictions that many people don’t know about and that might strip you of your tax savings. Take some time right now to figure out whether you qualify for the deduction and if not, what you can do about it.
If you want to convert your C corporation to an S corporation, you need a plan. No plan, BIG tax. The BIG tax means the tax on built-in gains at 35 percent. But it’s worse than that, and bigger than that, because after the 35 percent tax payment, you continue to pay at your regular tax rates on the remaining 65 percent that flows from your S corporation to you. This is torturous double taxation. So make a plan to avoid as much torture as possible, perhaps all of it. This article helps you with that plan by showing you four strategies that you can use.
Lawmakers have yet to decide if they will retroactively enact bonus depreciation and the higher Section 179 expensing limits for 2015 purchases. But if you’re looking to buy a large SUV or truck for your business, you may be surprised to learn how fast you can write off the full cost of the vehicle even if lawmakers fail to extend the tax breaks. Knowing the write-offs may entice you to pull the trigger on that purchase immediately instead of waiting for changes in the law.
A Roth IRA is not your average retirement plan. It’s a retirement savings, boondoggle savings, down payment savings, college savings, and emergency savings plan all wrapped into one. But to realize the benefits, you need to know how to avoid taxes and penalties when you take the money out. The good news: do this right and you can tap that Roth IRA and pay ZERO taxes and ZERO penalties.
Your rental properties provide tax shelter when you can deduct your losses against your other income. For you to deduct your losses, you need to pass the tax code’s 750-hour test. The good news in this article is that the home-office deduction can help you pass this test in some delightful ways that you would not usually think of.
You need to know a number of tax rules when it comes to selling your business. For example, you likely want tax-favored capital gains, but your buyer may not like that idea, as it cuts into the buyer’s tax deductions. This article is the first in a series of articles on selling your business, and it will help you understand how this process is going to work.
A great tax shelter is a rental property that shows a positive cash flow and a deductible tax loss. You can still have that type of tax shelter in today’s tax world. To make this work, most taxpayers, likely you included, need to avoid the investor trap to deduct their losses against all their other income (thus creating tax shelter). This article helps you avoid the investor trap so you can create the rental property tax shelter.
Have you ever faced this “problem”? A sudden boom in business requires you and your employees to work late in order to get everything finished. When this happens, how can you thank your employees for their overtime with a tax-free benefit that’s fully deductible to your business? You can provide a supper money fringe benefit if you follow four rules.
Most business meals suffer a 50 percent cut in the amount you can deduct. But here’s one of those business meal strategies that produces a 100 percent deduction. So if you spend $5,000 for meals with this strategy, you don’t deduct $2,500 because of the 50 percent. Instead, you deduct the full $5,000.
Business owners who operate their businesses as corporations and also deduct an office in the home commonly use one of three tax-deduction methods in an effort to achieve tax benefits. One method provides no tax benefit; it’s just smoke and mirrors. The second method might create a small deduction or none at all. The third method is the correct choice, as it ensures the full tax deduction and even reduces your chances of an IRS audit.
Tax law gives you several nice tax-saving strategies for your business assets but not many for your personal assets. So what happens when you convert a personal asset to a business asset? Does the personal taint last forever? No! This conversion opens the door to a world of new deductions.
You likely want to hire independent contractors whenever possible. But if you are bending and breaking the rules, you face big back taxes, horrific penalties, and interest. So, a question for you: Have you been misclassifying your workers? If so, the IRS has a good deal that lets you off the hook with just a tiny payment. We’re talking a fraction of what you would otherwise owe if you lost your contractor classification in an IRS employment tax audit.
The government wants to give you the gift of education. Your lawmakers in Washington created a tax break for courses that improve or maintain your business skills. You can deduct in full the cost of education ranging from a standalone seminar all the way up to an advanced degree—including the cost of an MBA program. But in order to get this deduction, you have to follow a couple simple rules.
You can protect yourself against the financial consequences of chronic illness or disability by purchasing long-term care insurance. The premiums for this insurance are not cheap, but tax law lets you write off the cost, thus subsidizing your purchase. But beware—there are three ways to take this deduction. Choosing the wrong method could cost you thousands of dollars in tax benefits.
If you have to sell your personal home at a loss, tax law gives you a deduction for the portion of your home you use as a home office or that you use for some other income-producing activity. This is a nice silver lining to an otherwise unpleasant financial situation. It puts money in your pocket.
If your tax debts have spiraled out of control, don’t give up hope. You may be able to use one of four IRS-created relief procedures to reduce or eliminate your debt. And if these methods still aren’t enough, find out whether bankruptcy can eliminate your remaining income tax liabilities.
If you don’t have a log of your business mileage, you are simply looking for trouble. And the IRS is happy to supply the trouble you are looking for. You might think that you just don’t have the time to keep a mileage log, but if you suffer an audit you will regret not spending that time, as you will lose your auto deductions because you did not have a mileage log. In this article, you will find good news that will help you keep a mileage log without spending lots of time.
What happens if you live in a house and make mortgage payments, but someone else owns the property? Can you still get a tax benefit? Absolutely! By proving that you have legal or equitable title to the property, you can deduct up to 100 percent of the mortgage interest you pay. For one subscriber, this generated an extra $18,000 per year of deductions she did not know she could claim.
You could add hundreds or even thousands of dollars to your wallet simply by putting the title of your vehicle in the right name—whether yours or the corporation’s. That’s about as easy as it gets to earn extra tax deductions. You put the title in the right name and then enjoy your extra cash.
Tax law has an incredible savings opportunity for your child—but only if he or she has a job. And if your child doesn’t have a job yet, you need to put him or her to work in your business, now. A job grants your child some tax-free income and makes your child eligible for a tax-savings retirement account that can create thousands or millions of extra dollars for your child to use for college, retirement, or a first home.
If your company wrongly classifies you as an employee rather than an independent contractor, you face one of the most unfair rules in tax law—you must pay tax on your deductions for business expenses! Find out why this happens and what you can do to fix it.
The IRS recently created a rule to make your life simpler and better. How is that for a change? It’s true. Now when you buy almost any tangible asset for $500 or less, you can immediately deduct the purchase if you follow the two easy steps laid out by the IRS. That means tax savings for you and fewer headaches for you and your tax preparer.
The IRS is making an unusually nice offer to you as a business or rental property owner—but it’s good for just a few months. You can take extra deductions right now if you performed certain major renovations on your business or rental property in prior years. If you think this applies to you, act fast so you do not miss the October (or September, if incorporated) 2015 deadline.
If you are an S corporation owner, you can get a full deduction for your health insurance premiums—despite Obamacare and even if your S corporation provides zero health benefits to non-owner employees. You have to follow a few steps to qualify for this deduction, but that’s a piece of cake once you know the rules.
If you hire workers and want to classify some of them as independent contractors, you absolutely need to know about Section 530 and its safe harbor. By law, Section 530 is the first step in an employment tax audit. And if you don’t know about Section 530, you are making a potentially fatal financial mistake.
Have you been longing for the good old days when you could offer a Section 105 health plan to your employees without having to comply with the new Obamacare rules? Well, you can still offer such a plan—provided that you limit the benefits to vision and dental.
Where can you hold your tax-deductible board meetings if you operate your business as a corporation? Could you go to a nice resort? What if you and your spouse are the only board members? This article answers these common questions. It’s sure to make you smile.
The government wants you to have happy employees. That’s why the tax code grants you extra deductions when you provide entertainment and entertainment facilities that primarily benefit rank-and-file employees. In this article, we examine how the rules work when you take your employees on a party trip.