The American Institute of CPAs offers a brief review on what circumstances come in to play to determine if you ever find it necessary to request additional time to file a tax return. The review answers questions relating to what filing an extension does, why a CPA might suggest you file an extension, what the extension does in determining the likelihood of an audit, and the benefits of extending a return. To read the AICPA article, please click here. (PDF)
Social welfare organizations receive extension when notifying IRS of their intent to operate as non-profit
Social welfare organizations, or 501(c)(4) groups, will have more time to comply with a new IRS reporting rule. Those organizations established after December 18, 2015, must notify the IRS in writing of their formation and intention to operate as a social welfare organization and pay a user fee within 60 days of formation. Certain groups in existence on or before December 18, 2015, have until June 15 to comply.
As a small business owner, are you in need of a cash influx? Thanks to the new tax law -- the Protecting Americans from Tax Hikes (PATH) Act – small business owners can offer a unique tax incentive to investors: A 100 percent tax exclusion on the subsequent sale of “qualified small business stock” (QSBS). But there’s a catch: Among other requirements, the QSBS must be held at least five years before it’s sold.
Prior to the PATH Act, the tax exclusion for QSBS was scheduled to be cut in half to 50 percent for stock acquired after December 31, 2014. But the new law preserves the 100 percent exclusion, retroactive to January 1, 2015, and makes it permanent. This change could encourage investors to show more faith in small business operations.
While a tax deduction is only part of the reason you donate to charity, taking steps to protect your deduction is good planning. Here's what you need to know.
* When you give money. Support monetary contributions of any amount with a cancelled check, credit card statement, proof of payroll deduction, or a receipt. For monetary contributions of $250 or more, get a contemporaneous written acknowledgement. "Contemporaneous" means you have a receipt in hand no later than the date you file the return for the year the contribution is made (for your 2015 federal income tax return, that's generally April 18, 2016).
Do you offer a workplace financial education program to your employees? It's a perk they may be looking for, and one that can benefit your business at the same time. Here are some tips to get started.
* Investigate training program options. One-on-one counseling can be an efficient method for conveying financial information quickly, and provides the added advantage of confidentiality. An employee may be more likely to discuss, say, a problem with credit card debt if the conversation is held in a private setting. Group classes can be used to present more generic information about financial goals, household budgeting, insurance, debt, and investments.
Accounting Today addresses the most important tax changes affecting businesses this year in a January 19 online post entitled, "Major business tax changes for 2016."
Many were ushered in by the Protecting Americans from Tax Hikes (PATH) Act of 2015, although legislation enacted earlier in 2015 and in 2014 also contributed a fair share. Still other changes are the result of various administrative pronouncements by the IRS.
The recent legislation responsible for the lion's share of the changed rules for 2016 consists of:
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