News & Updates

2022 – 08/23 – Home sweet home: Do you qualify for office deductions?

September 12, 2022
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If you’re a business owner working from home or an entrepreneur with a side gig, you may qualify for home office deductions. On the other hand, employees who work remotely can’t deduct home office expenses under current federal tax law. To qualify for a deduction, you must use part of your home regularly and exclusively as your principal place of business, or a place to meet with customers, clients or patients in the normal course of business. Typically, the business use percentage is determined by your home office’s square footage but there are other methods. We can address questions about the best way to compute home office deductions and the tax implications when you sell your home.

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2022 – 08/29 – Inflation Reduction Act provisions of interest to small businesses

September 10, 2022
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The new Inflation Reduction Act contains a provision that provides tax relief for small businesses. Under current law, qualified small businesses can elect to claim a portion of their research credit as a payroll tax credit against their employer Social Security tax liability, rather than against their income tax liability. A qualified small business can now claim up to $250,000 of its credit for increasing research activities as a payroll tax credit. Under the new law, qualified small businesses can apply an additional $250,000 in qualifying research expenses as a payroll credit against the employer share of Medicare. This provision takes effect for tax years beginning after Dec. 31, 2022.

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2022 – 07/25 – Three tax breaks for small businesses

August 15, 2022
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Sometimes small is better: Your small business may be eligible for tax breaks that aren’t available to large businesses. For example, the qualified business income (QBI) deduction is available to eligible individuals but not to C corporations or their shareholders. The deduction can be up to 20% of: 1) QBI earned from a sole proprietorship or single-member LLC treated as one for federal income tax purposes, plus 2) QBI passed through from a pass-through business, meaning a partnership, S corp or LLC classified as a partnership. Pass-through businesses report tax items to their owners, who then take them into account on their own returns. The rules are complex. Contact us with questions.

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2022 – 08/02 – Is your withholding adequate? Here’s how to check

August 12, 2022
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When you filed your federal tax return this year, were you surprised to find you owed money? Or did you wind up getting a large refund? Either situation might mean it’s time to review and adjust your withholding. This might be necessary because something in your life is different this year (for example, you got married, divorced, had a child, purchased a home or had changes in your income). The IRS has a withholding calculator where you can perform a paycheck checkup. You can access the calculator at https://bit.ly/33iBcZV.  Contact us if you need help determining whether you should adjust your 2022 withholding.

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2022 – 05/23 – Partners may have to report more income on tax returns than they receive in cash

June 20, 2022
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If you’re a partner in a business, you may have come across a situation that’s puzzling. In a given year, you may be taxed on more partnership income than was distributed to you from the partnership in which you’re a partner. Why? It’s due to the way partnerships and partners are taxed. Unlike C corporations, partnerships aren’t subject to income tax. Instead, each partner is taxed on partnership earnings whether or not they’re distributed. And if a partnership has a loss, it’s passed through to partners. (However, various rules may prevent partners from currently using their share of a partnership’s loss to offset other income.) Contact us if you’d like to discuss how a partner is taxed.

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