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Helping Your Fellow Business Owner

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Your firm survived 2020. Now you may be asking yourself when will the economy return to pre-pandemic levels? Will it be this fall? A year from now? Longer? Until the economy fully emerges from the pandemic, small businesses can help one another stay afloat. By collaborating with other like-minded firms, your business can find creative ways to strengthen local markets and encourage consumer loyalty. Consider the following ideas of how you can help each other: Partner with industry peers.  One Vietnamese restauranteur in New York City was eager to open his business for in-person dining. Then the pandemic hit. According to a Time Magazine article, two years of careful planning, hard work and sacrifice seemed fruitless. But sympathetic restaurant owners in nearby Chinatown reached out with an innovative idea: offer a punch card to encourage customers to support local businesses. By partnering with this newly-minted entrepreneur and introducing him
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Donating to Charities? Do it RIGHT! Donation basics to ensure a tax deduction

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D onating to charity not only helps others, it can reduce your tax bill — but only if the charity qualifies as a tax-exempt organization. Checking for qualified status If you plan on itemizing your deductions on your tax return, make sure the organization you're donating to is designated by the IRS as a 501(c)(3) organization in good standing. You can find a list qualified  501(c)(3) organizations  on the IRS website. Remember, even last year's qualified organizations could lose their non-profit status if they do not submit their annual tax filing! Is it a good charity? Ensuring a tax-exempt status is not your only step. You should also conduct research on your charitable organization. There are many websites that evaluate organizations, how they spend their funds, and how efficient your donation is being used. So check out your charities on sites such as  Charity Navigato r ,  Charity Watch  and   BBB Wise Giving Alliance . Get your documentation right Here are
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IRS Comments on Unused Transportation Fringe Benefits

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In a recent Information Letter, the taxpayer was participating in her employer's qualified transportation fringe benefit plan when she was fired. At that time, she had approximately $380 of unused commuter benefits. (The benefits were obtained through compensation reduction contributions.) According to the IRS, employees who stop participating in a qualified transportation benefit plan without cancelling their compensation reduction election can't receive a refund of any amount (even if contributions exceed actual benefits). This is the case whether the employee is fired or quits voluntarily. The IRS also concluded that the terminated employee can't use the funds for continued transportation expenses.  Source : Thomson Reuters/ http://www.sadhcpa.com
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Owe Taxes? Make Payment Arrangements Now!

I f you owe taxes on your 2018 tax return, the due date to make the payment is Monday, April 15. Miss this deadline by just one day and the IRS will charge you interest and penalties! Don’t risk adding unnecessary dollars to your tax bill. Review the payment options below and make a plan now to ensure your payment arrangements are completed before the deadline. Options to pay immediately IRS direct pay . This free service allows you to pay your balance online using a checking or savings account. Electronic Federal Tax Payment System (EFTPS) . This free service also allows payment from a checking or savings account, but you can pay online OR by phone. Debit or credit card payment . The IRS has three authorized third-party processors to accept payment by debit or credit card, but they charge a fee. Debit card transactions have flat fees that range from $2 to $4. Credit cards are more costly at 2 percent of the entire transaction. Check or money order. These payments can be made
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Homeowner Alert! Review Your Tax Forms New tax rules are creating confusion

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B ecause of new laws many home related tax rules have changed and now require you to prove how funds are used to qualify for a deduction. This is catching many taxpayers by surprise. So when your mortgage company reports tax-related information to you and the IRS using Form 1098, it no longer means all the interest and points reported on these statements are tax-deductible. Mortgage interest deductions have new loan amount limits. For new mortgages starting on or after Dec. 15, 2017, you can deduct interest on up to $750,000 of the loan (down from $1 million for mortgages initiated before Dec. 15, 2021) . If your original mortgage is above the threshold, a calculation will be done to determine the deductible amount of interest. You can’t simply deduct the full amount of interest being reported on your Form 1098. Proceeds not used to buy a home add complexity. Proceeds from home equity debt that are not used to build, buy or substantially improve a qualified home are no longer t
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The New Business Deduction ( Stop worrying and start preparing )

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A new deduction is available to businesses with qualified business income (QBI). While that's great news, new deductions (especially ones with lots of rules) can bring anxiety and confusion. Never fear! Ensuring you receive a maximum deduction will come down to providing the proper information. Here is some knowledge to help you cut through the confusion: What is the QBI deduction? In short, it's a 20 percent deduction against ordinary income, taken on your personal tax return,   that reduces qualified business income earned for most pass-through businesses (sole proprietorships, partnerships and S-corporations). It's not an itemized deduction , so you can take it in addition to the standard deduction. To qualify without limitations, your total taxable income needs to be below $157,500 ($315,000 for married couples) for 2021. If your income exceeds the threshold, it gets complicated. What you need to know: ·          If your total taxable income is above th
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Achieve Tax Resolution with an Offer in Compromise

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Did you know that you can settle your debt with the IRS for just small amount on the dollar with their Offer in Compromise program? The program allows taxpayers to settle with the IRS on tax debt that has been not correctly assessed or for liabilities they cannot afford to pay. . It's a program for taxpayers who owe the ‏IRS more money than they can afford to pay. It’s the IRS’s version of a "fresh start" when it comes to  back tax debt. If approved, the IRS accept a lesser amount sometimes a fraction of what’s owed to settle your debt. Therefore, it is not always easy to gain approval due to its strict criteria. Your odds for acceptance increase significantly when you have experience negotiating with the Internal Revenue Service. The IRS considers your income, assets, expenses, ability to pay, & whether paying the full amount would cause financial hardship. For more Information You Need to Submit an Application for an Offer in Compromise.. It's
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