Sales tax on interstate accounting services

Posted Leave a commentPosted in Accounting, News and Politics, Small Business, Taxes

The Democrat-led Finance Committee of the Connecticut General Assembly voted yesterday (4/29/2015) to expand its state sales tax to include accounting services. The Senate President Pro Tem said that he supports the changes but there appears to be opposition to the move beyond that. Three states currently tax professional services: New Mexico, Hawaii and South […]

Variance in taxes is part of the game

Posted Leave a commentPosted in Accounting, Tax Planning, Taxes

I have little patience lately for tax accountants who assert that their approach is “correct” and that all other results are “errors”. This is like having the sideline judge disagreeing with the referee on the field that called the play. We understand the mentality that the law is meant to be precise and therefore the results […]

Tax accounting for hobby income and expenses

Posted Leave a commentPosted in Tax Planning, Taxes

If you have an active hobby then you might find that you make some money at it. But it is important to recognize that the IRS makes a distinction between businesses run for profit and those that are hobbies without a profit motive. This post summarizes the four key differences in tax accounting between the two. […]

Why middle-income tax planning is dead

Posted Leave a commentPosted in Financial Planning, Tax Planning, Taxes

Bloomberg and Wall Street Journal ran articles this week that compile and analyze federal income tax data. These articles were meant for use as an exposé of policy tax policy. I skipped the social policy discussion entirely and I looked at the data from the perspective of a small solo CPA’s income tax service. It is interesting […]

Financial Planning Considerations When Your Business is Losing Money

Posted Leave a commentPosted in Accounting, Financial Planning, Small Business, Tax Planning, Taxes

This post was inspired by the stories of some of my neighbors and clients in southern New Jersey. Most were struggling with  a weak economy before super storm Sandy hit in late 2012. Those that re-opened over the next few years face continued business losses and the prospect of continued weakening of the local economy […]

Tax deduction for contributed time or services

Posted Leave a commentPosted in nonprofit, Taxes

I’ve often had the opportunity to work as the volunteer accountant, trustee or adviser for some great charitable organizations. In the course of this work, I meet plenty of other like-minded generous people. One amazingly common misperception that many of these people share is a misunderstanding of the tax treatment of donated time or services. […]