From a December 7, 2016, Accounting Today online article.
On December 7, the Senate passed legislation eliminating a tax penalty on employers who reimburse employees for the cost of health insurance premiums, following passage of the measure last week in the House.
The IRS began enforcing the penalty on employers last year, even though it isn’t part of the Affordable Care Act. Employers who violate the rule can be fined up to $100 per day for each employee, or up to $36,500 a year, which is 18 times more than the penalty imposed on larger employers that don’t offer insurance to workers.
Under Section 18001 of the 21st Century Cures Act, business owners would be permitted to compensate employees for the cost of individual insurance premiums or medical visits. President Obama has issued a statement in support of the legislation.
Are you planning to make donations to charitable organizations as part of your holiday celebrations? Be aware of fake charities set up by scam artists. This type of fraud routinely lands on the "Dirty Dozen" list of tax scams prepared each year by the IRS.
Here are two simple tips to protect yourself.
Don't be fooled by names that sound like established charities but really aren't. The IRS maintains a searchable list of qualified charities on the official irs.gov website.
2016 is winding down, but you still have time to wrap up business tax strategies before December 31. Here are five to put on your list.
Make capital contributions. When you have losses in your Subchapter S corporation, the amount you can deduct on your personal tax return may be restricted. That's because losses are limited to your basis, which includes your investment in the business stock and certain loans. Injecting capital or making a direct loan to your business before year-end can increase your basis and keep your losses deductible.
Review inventory. Remove obsolete, unsalable, or damaged items to reduce your year-end inventory balance. Donating inventory to qualified charities may result in an enhanced deduction.
While credit cards can be very useful financial tools, the borrowed money is not "free." Here are two opportunities to share that lesson with your kids.
When choosing a card. Show your kids the entire credit card lifecycle. Explain that when evaluating credit cards, a comparison of benefits is crucial. For example, although choosing a credit card that offers a large signing bonus may be tempting, an annual fee associated with the card can mean the benefit is not worth the cost.
By Andrew Schmidt, CPA
Andrew Schmidt is a senior associate in the Tax Department of Dugan & Lopatka. His responsibilities are comprised of preparing tax returns for businesses and their individual owners. Andrew provides tax planning and compliance services for our clients, to include performing tax research on a variety of topics. This article appeared in the November 14, 2016, edition of the Daily Herald Business Ledger.
It’s that time of the year again; time to evaluate your business's end of the year tax planning strategies. Business owners can and should be evaluating and planning for strategies to utilize throughout the year but that can be challenging with uncertainty of how the year is going to progress. The end of the year provides a clearer picture. Here are some things to consider now.
December 31 is the last day you can take advantage of this year's annual gift tax exclusion. The exclusion is the amount you can give away each year without triggering gift tax. For 2016, the exclusion is $14,000 per recipient. If you and your spouse "split" your gifts, you can give up to $28,000. Here's what you need to know.
- All gifts during the year, including birthday and holiday presents, count toward the $14,000 (or $28,000) annual gift tax exclusion. For example, say you give a $500 birthday present to your grandchild. You can give that grandchild up to an additional $13,500 without triggering the requirement to file a gift tax return.
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