Category: Accounting
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Trump Accounting: cooking the books at the expense of the rest of us
Details are slowly emerging about Trump’s methods of accounting that place vastly different values on assets depending on the purpose of the report. One example cited by the Washington Post is the Trump National Golf Club in In Ossining, New York: The municipal tax assessor values the golf club at roughly $15 million. Trump’s attorneys…
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The worst mistake a business owner can make
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…
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Tax planning for young high income individuals
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…
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IRS admits erroneous tax penalties
IRS announced today that a software error is causing some small business taxpayers to receive a tax penalty notice for late filing and payment of second quarter payroll taxes. IRS is working to resolve the issue and it will correct the erroneous penalty assessments in the near future. Those affected will receive correspondence when the…
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A change to my income tax service agreement
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…
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How to deduct 98% of your cell phone bill
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…
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Bank needs accountant’s verification
Your mortgage lender asks for an accountant’s verification of your income or tax return information or that you are self-employed. Simple right? Not always. CPAs are controlled by strict rules for these “comfort letters”. I do my best to help clients with their loan application and satisfy the lender. To learn more about this topic…
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Uber wins independent contractor case in California
Worker classification has been one of the hottest issues of business management affecting large and small businesses alike. Yesterday one of the high profile cases in this arena was resolved when Uber announced that it negotiated the right to continue to classify workers as independent contractors in the state of California. Uber gave up the…
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A better way to take a home office deduction
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…
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Tax deductible employee business expenses
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…