Category: Tax Planning
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How we handle tax fraud
I wrote this comment tonight to a young Enrolled Agent struggling with a client committing tax fraud who described herself as naïve about the human behavior behind it. “XXXXXXX, this is a general comment and not in any way meant as a negative personal thing. I would suspect that anyone putting the massive time and…
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America Competes Act could bring tax changes
America Competes Act is not intended as tax reform legislation. Yet some tax advisers are talking about the impact it could have on individuals and businesses. First, we should consider that the probability of this proposal becoming law is high. This status is far different from the many rumors and massive amount of tax reform…
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Top 10 IRS audit triggers and what you should do about it if you are at risk
Here are the top 10 IRS tax audit triggers, as compiled and published by The Wall Street Journal1 on March 5, 2022:1. Education tax credits2. Small businesses3. Child tax credit4. Cryptocurrency5. Earned income tax credit6. Large charitable deductions7. Rental income8. Home office deductions9. Early withdrawals from IRAs and 401(k)s10. Health premium tax credit If you…
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Tax changes are not real
I find myself in the unfamiliar position of saying “It’s not real!” to the wide range of voices talking about the ‘Biden tax changes’. We (that is, the large majority of experienced tax professionals who earn their living talking about the future of taxes) have been saying that there are no significant change in the…
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Review of Biden administration tax policy progress after one year in office
The Biden administration proposed two major themes in its tax reform agenda. These were widely promoted during the campaign and then heavily promoted by the White House and the U.S. Department of the Treasury over the past year. Now, one year after the administration began work, this blog post reviews the progress made and the…
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Simple overview of tax options for LLCs
If you operate a business as a Limited Liability Company (LLC), the. you have some choice in how to have your business earnings taxed. There are protocols and restrictions that are not covered here in this post. This short post overviews the most common options, advantages and limitations of tax options available to LLCs. Sole…
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2021: the year of tax misinformation
2021 may be remembered as the year when more taxpayers were hurt by bad tax advice than any other. Some recently published sources say millions were led astray by just one illegal strategy involving IRAs. The scam was promoted by just a few sales companies but gained viral popularity as quickly as other fake news…
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After the fact payroll and defined contribution plans: the late December rush to save taxes
The two hottest small business tax planning topics in these final days of any year are: after-the-fact payroll, and defined contribution employee benefits. What this means is that simply by dating and documenting actions taken before December 31, the business and business owner can lock in valuable tax benefits. While some corrective or mediating action may…
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Avoiding SALT tax deduction limitation
Yesterday a financial advice column in NJ.com carried a Q&A from a guy who contemplated leaving New Jersey and moving to Florida because he could not deduct all of his state and local taxes. The post went methodically through all the pros and cons and associated calculations of the question posed. But it missed the…
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The toughest year for tax planning
Year end tax saving work for small business owners often involves compensation and benefits planning. Compensation and benefits planning has been at the core of my solo practice for 25+ years, especially since my 1995 graduation from Villanova Law that has an excellent program for this area of practice in their MT program. But the…