Are you thinking about launching a business with some partners and wondering what type of entity to form? An S corporation may be the most suitable form of business for your new venture. Here’s an explanation of the reasons why. The biggest advantage of an S corporation over a partnership is that as S corporation … Read More
President Biden signed the $1.9 trillion American Rescue Plan Act (ARPA) on March 11. While the new law is best known for the provisions providing relief to individuals, there are also several tax breaks and financial benefits for businesses. Here are some of the tax highlights of the ARPA. The Employee Retention Credit (ERC). This … Read More
When you file your tax return, you must check one of the following filing statuses: Single, married filing jointly, married filing separately, head of household or qualifying widow(er). Who qualifies to file a return as a head of household, which is more favorable than single? To qualify, you must maintain a household, which for more … Read More
If you have a life insurance policy, you may want to ensure that the benefits your family will receive after your death won’t be included in your estate. That way, the benefits won’t be subject to federal estate tax. Current exemption amounts For 2021, the federal estate and gift tax exemption is $11.7 million ($23.4 … Read More
The big news recently was an extension of the income tax filing and payment deadline for individuals from April 15 to May 17, 2021. But the IRS just announced the deadline is also extended to May 17 for tasks including: 1) making contributions to IRAs and Roth IRAs and 2) reporting and paying the 10% … Read More
The new American Rescue Plan Act (ARPA) provides eligible families with an enhanced child and dependent care credit for 2021. This is the credit available for expenses a taxpayer pays for the care of qualifying children under the age of 13 so that the taxpayer can be gainfully employed. Note that a credit reduces your … Read More
Food and beverage establishments may be able to get a tax credit for their employees’ tips. The credit is for the Social Security and Medicare (FICA) taxes the employer paid on the employee’s tip income. After employees report their tips to you, you must withhold and remit their share of FICA taxes and also pay … Read More
A popular health care tax credit is temporarily enhanced by the American Rescue Plan Act (ARPA). The premium tax credit (PTC) is a refundable credit that helps individuals and families pay for health insurance through the Marketplace (part of the Affordable Care Act). Previously, taxpayers with household income above 400% of the federal poverty line … Read More
If your family owns a vacation home, you know what a relaxing refuge it can be. This is especially true these days due to the limited travel options you may have because of COVID-19 pandemic restrictions. However, without a solid plan and ground rules that all family members agree to, conflict and tension may result … Read More
The IRS is swamped with a backlog of unprocessed returns, according to a recent report. The Treasury Inspector General for Tax Administration (TIGTA) report stressed that the IRS’s ability to resolve the backlog “could be affected by the need to divert resources to issue additional Economic Impact Payments or an unforeseen closure of IRS Tax … Read More