The worst mistake a business owner can make

Posted Leave a commentPosted in Accounting, Small Business, Taxes

The worst mistake a small business owner can make is to pay employee wage taxes that were withheld from employee salary. The second worst mistake, in my observation, is to try to handle the problem yourself. I see cases where the business owners or managers are damaged for more than a decade as a result of mishandling […]

Tax planning for young high income individuals

Posted Leave a commentPosted in Accounting, Taxes

Our tax system is designed to limit the tax reducing opportunities for high income individuals. The higher our income, the more difficult it it to reduce our taxes through traditional tax planning tools. First, to help frame the discussion, I use the term “tax efficiency” rather than “tax savings”. The difference is subtle but better […]

A change to my income tax service agreement

Posted 1 CommentPosted in Accounting, Tax Planning, Taxes

    IRS knows that if five different tax professionals prepare the same moderately complicated income tax return, there will be 5 different returns with 5 different outcomes in terms of the amounts of income tax liability. IRS also knows that it will receive at least 4 of these 5 submitted returns as filed and accepted tax […]

How to get a copy of your tax return

Posted Leave a commentPosted in Tax Planning, Taxes

If you need a copy of your tax return the fastest, easiest, cheapest solution is to order a transcript from IRS. This is free but delivered only by mail for security reasons. Put in an online request at https://www.irs.gov/Individuals/Get-Transcript . A transcript is a printed version of the electronic data contained in your tax return. It is formatted differently […]

How to deduct 98% of your cell phone bill

Posted Leave a commentPosted in Accounting, Computers and Internet, Data Management, Small Business, Taxes

A few months ago during tax season I wrote about how changing wireless phone billing practices are having an impact on income tax preparation practices. But I did not realize the extent of that change – and how it directly applied to me – until now. I concluded that I can legitimately deduct 98% of […]

A better way to take a home office deduction

Posted Leave a commentPosted in Accounting, Small Business, Taxes

IRS and state tax authorities allow taxpayers to deduct expenses for areas of their home used exclusively for a home office. But there are downsides and risks to taking the deduction. Those disadvantages include: Part of the sales price of the home may eventually become taxable (most home sales are otherwise non-taxable) Detailed accounting records […]

Tax deductible employee business expenses

Posted Leave a commentPosted in Accounting, Entertainment, Taxes, Travel

The basics of an often-misunderstood tax topic If you are an employee with expenses related to your job, these expenses are not taxable income. If your employer reimburses these expenses separately from your wages then these amounts are not taxed and you need to take no further action. But if the amounts were included in your […]