By month: March 2017
The 105-HRA is the medical reimbursement plan you likely want to use if (a) you report your business income and expenses on Schedule C of your Form 1040 and (b) you can make your spouse your one and only eligible employee. Also, if you are single and operate your business as a C corporation, and if you are the one and only eligible employee of your C corporation, the 105-HRA is the medical reimbursement plan for you.
Mileage-rate addicts usually think that the mileage rate takes care of everything—then they cost themselves money by failing to deduct a loss on the sale of a business vehicle.
Do you pay yourself on a 1099 for the work you do in your S corporation? Why wouldn’t you, right? It makes life so simple. No payroll taxes to deal with, no withholding deposits, and no payroll services to pay for. Stop right there! Your simple life is about to get very complicated unless you make a change right now.
You’ve decided to create a partnership for a new or existing business. Good news: forming a business partnership is usually tax-free. But you must meet the basic requirements for a tax-free formation, and you need to avoid the situations that cause you to owe taxes on the transfer of property.
Business owners continue to get caught in the complex rules of the self-rental trap. A recent case taken from the Tax Court to the Fifth Circuit shows how business owners can get into tax trouble with self-rentals. But with proper tax planning and possible use of special rules called “grouping,” you can minimize and even eliminate the tax cost of the self-rental trap.
If you receive an award or settlement due to an injury claim, the law allows you to exclude some or all of the money you receive from taxation. You can use this exclusion along with other tax reduction strategies to minimize any tax you must pay on the amount you receive.
When you buy a business, you have much to consider. As you learned in prior articles, you need to consider the type of entity that owns the business and the type of entity you will use to operate the business. On top of that, every asset of the business you are going to buy impacts your tax results. In this article, you see how this all comes together and what you need to do to get the best results.