In recent years, the accounting rules for certain balance sheet items have transitioned from historical cost to “fair value.” Examples of assets that may currently be reported at fair value are asset retirement obligations, derivatives and intangible assets acquired in a business combination. Though fair value may better align your company’s financial statements with today’s … Read More
According to a U.S. Treasury analysis, the “tax gap” totaled nearly $600 billion in 2019 and will rise to about $7 trillion over the course of the next decade if left unaddressed. The tax gap is the difference between the amount of tax owed and the amount that’s actually timely paid. President Biden’s proposals to … Read More
Many businesses use independent contractors to help keep their costs down. If you’re among them, make sure that these workers are properly classified for federal tax purposes. If the IRS reclassifies them as employees, it can be a costly error. It can be complex to determine whether a worker is an independent contractor or an … Read More
The Congressional Budget Office (CBO) has estimated that the federal budget deficit for the first seven months of fiscal year 2021 reached $1.9 trillion, $449 billion more than the deficit recorded during the same period in fiscal year 2020. The CBO said that even though there was an upsurge in revenue, the deficit continues to … Read More
Before the COVID-19 pandemic hit, the number of people engaged in the “gig” or sharing economy had been growing, according to several reports. And reductions in working hours during the pandemic have caused even more people to turn to gig work to make up lost income. There are tax consequences for the people who perform … Read More
Many businesses provide education fringe benefits so their employees can improve their skills and gain additional knowledge. An employee can receive, on a tax-free basis, up to $5,250 each year from his or her employer for educational assistance under a “qualified educational assistance program.” For this purpose, “education” means any form of instruction or training … Read More
Are you wondering whether alternative energy technologies can help you manage energy costs in your business? If so, there’s a valuable federal income tax benefit (the business energy credit) that applies to the acquisition of many types of alternative energy property. The credit is intended primarily for business users of alternative energy (other energy tax … Read More
“Tax day” is just around the corner. This year, the deadline for filing 2020 individual tax returns is Monday, May 17, 2021. The IRS postponed the usual April 15 due date due to the COVID-19 pandemic. If you still aren’t ready to file your return, you should request a tax-filing extension. Anyone can request one … Read More
The IRS has released its 2021 Collection Financial Standards. These standards are used to determine the ability of a taxpayer to pay a delinquent tax debt. They’re effective for an IRS analysis of a person’s finances conducted on or after April 26. There are national standards for food, clothing, personal care, household items, and healthcare. … Read More
The May 17 deadline for filing your 2020 individual tax return is coming up soon. It’s important to file and pay your tax return on time to avoid penalties imposed by the IRS. Here are the basic rules. Failure to pay Separate penalties apply for failing to pay and failing to file. The failure-to-pay penalty … Read More