Viewing posts categorised under: Uncategorized
30May
A “back door” Roth IRA can benefit higher-income taxpayers
Retirement Planning

 

A potential downside of tax-deferred saving through a traditional retirement plan is that you’ll have to pay taxes when you make withdrawals at retirement. Roth plans, on the other hand, allow tax-free distributions; the tradeoff is that contributions to these plans don’t reduce your current-year taxable income.

Unfortunately, your employer might not offer a Roth 401(k) or another Roth option, and modified adjusted gross income (MAGI)-based phaseouts may reduce or eliminate your ability to contribute to a Roth IRA. Fortunately, there is a solution: the “back door” Roth IRA.

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10Mar
Deduct all of the mileage you’re entitled to — but not more
Taxes

Rather than keeping track of the actual cost of operating a vehicle, employees and self-employed taxpayers can use a standard mileage rate to compute their deduction related to using a vehicle for business. But you might also be able to deduct miles driven for other purposes, including medical, moving and charitable purposes.  

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05Jan
Why nonprofits should be careful about doing business with board members
Non-profit

 

Your not-for-profit’s board members may be able to offer access to better deals or services than your organization could get on its own. However, there’s a fine line between a board member helping your nonprofit get fair pricing and the member receiving perceived or actual personal benefits. The latter can threaten your exempt status.

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21Dec
Ensure your year-end donations will be deductible on your 2016 return
Charitable Giving

 

Donations to qualified charities are generally fully deductible, and they may be the easiest deductible expense to time to your tax advantage. After all, you control exactly when and how much you give. To ensure your donations will be deductible on your 2016 return, you must make them by year end to qualified charities.

When’s the delivery date?

To be deductible on your 2016 return, a charitable donation must be made by Dec. 31, 2016. According to the IRS, a donation generally is “made” at the time of its “unconditional delivery.” But what does this mean? Is it the date you, for example, write a check or make an online gift via your credit card? Or is it the date the charity actually receives the funds — or perhaps the date of the charity’s acknowledgment of your gift?

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14Nov
A quick look at the President-elect’s tax plan for businesses
Taxes

 

The election of Donald Trump as President of the United States could result in major tax law changes in 2017. Proposed changes spelled out in Trump’s tax reform plan released earlier this year that would affect businesses include:

• Reducing the top corporate income tax rate from 35% to 15%,
• Abolishing the corporate alternative minimum tax,
• Allowing owners of flow-through entities to pay tax on business income at the proposed 15% corporate rate rather than their own individual income tax rate, although there seems to be ambiguity on the specifics of how this provision would work,
• Eliminating the Section 199 deduction, also commonly referred to as the manufacturers’ deduction or the domestic production activities deduction, as well as most other business breaks — but, notably, not the research credit,
• Allowing U.S. companies engaged in manufacturing to choose the full expensing of capital investment or the deductibility of interest paid, and
• Enacting a deemed repatriation of currently deferred foreign profits at a 10% tax rate.
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21Oct
Sorting through the “levels of assurance” in financial reporting
Uncategorized

 

How confident (or assured) are you that your financial reports are reliable, timely and relevant? In order of increasing level of rigor, accountants generally offer three types of assurance services: compilations, reviews and audits. What’s appropriate for your company depends on the needs of creditors or investors, as well as the size, complexity and risk level of your organization.

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05Oct
3 strategies for tax-smart giving
Estate Planning

 

Giving away assets during your life will help reduce the size of your taxable estate, which is beneficial if you have a large estate that could be subject to estate taxes. For 2016, the lifetime gift and estate tax exemption is $5.45 million (twice that for married couples with proper estate planning strategies in place).

Even if your estate tax isn’t large enough for estate taxes to be a concern, there are income tax consequences to consider. Plus it’s possible the estate tax exemption could be reduced or your wealth could increase significantly in the future, and estate taxes could become a concern.

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19Aug
What you need to know about estimated tax payments
Uncategorized

 

Paying the proper amount of tax by the annual federal income tax filing deadline isn’t enough to avoid interest and penalties; you must also meet requirements for paying tax throughout the year through withholding and/or quarterly estimated tax payments. If you have income from sources such as self-employment, interest, dividends, alimony, rent, prizes, awards or the sales of assets, you may have to pay estimated tax.

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21Jul
The “kiddie tax”: A trap for the unwary
Personal Finance

 

It’s common for parents, grandparents and others to make gifts to minors and college students. Perhaps you want to help fund education expenses or simply remove assets from your taxable estate. Or maybe you’re hoping to shift income into a lower tax bracket. Whatever the reason, beware of the “kiddie tax.”

What is the kiddie tax?

For children subject to the kiddie tax, any unearned income beyond $2,100 (for 2016) is taxed at their parents’ marginal rate (assuming it’s higher), rather than their own likely low rate.

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18May
Moving Employers? Don’t Miss This 3-Step Checklist
Personal Finance

filing cabinets at the officeAll around us, a change is happening in the workforce. Much of today’s work looks significantly different than work of days past. Unlike past decades where employees exchanged loyalty and hard work for long tenures with one company, new generations of workers are switching jobs more frequently.

But switching jobs isn’t as simple as, well, “just” switching jobs. Moving from one company to another without making proper tax considerations, especially if you get a raise, is an almost surefire way to end up with an unpleasant surprise come April.

So: what exactly should you do when leaving one job to start a new one? Here’s a simple, three-step checklist to kickstart your process:

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