Recently the IRS released "Notice 2018-64" regarding the new Qualified Business Income (QBI) 20% deduction. Now I won't go into great details regarding the notice, but it basically provides small businesses with a method for calculating W-2 wages for the purposes of determining if a small business qualifies for QBI. The notice outlines the regulations and specifies which business types qualify for the deduction. These regulations are proposed regulations (may be subject to change) and tax payers and professionals will need to rely on this guidance until final regulations are published.
The new QBI regulations will affect a great deal of small business owners in more ways than one. Some questions that small business owners need to address include:
We are currently developing a presentation that will go into greater detail regarding the QBI deduction and what you need to do as a small business owner to protect your hard earned dollars.
Presidential Candidates Tax Proposals
With just a few days left to go out and vote, here are the tax proposals for the two leading candidates.
If procrastination were the Super Bowl, many small business owners (SBO's) would have multiple "Lombardi" trophies.
Time to put away those whites (unless you are Billy "White Shoes" Johnson) and pull out the ole playbook of late summer early fall tax planning ideas. Just like the start of the NFL football season brings teams a new playbook, SBO's need to update their tax strategy playbooks now to ensure that they will be ready for the tax planning season starting now.
Most SBO's can take a look at their previous season's record to give them an idea of how good their tax playbook was and where they need to be this year. If you have not "completed the 2013 tax season" yet, here are some of the more important "game" dates in the coming months where many SBO's can complete the 2013 tax season.
• September 15th - Tax extension deadline for C-Corps, S-Corps and Partnerships
• October 15th - Tax extension deadline for personal tax returns
• December 31st - Final day of tax planning for 2014 season
If you have completed the 2013 tax, great, but this is not the time to sit back on your laurels! Time is now to focus on new tax plays for the 2014 season. The tax league’s “Front Office” is making quite a few rule changes this year that may make it difficult for SBO’s to score many tax savings touchdowns (expiring tax provisions for SBO’s), but the basic rules are still in effect. Since the season is shorter than the NFL one, tax planning is key to saving your small business thousands. Using legal "black letter" tax strategies in your playbook will ensure you have a winning record this season.
Need help devising your tax strategy playbook, feel free to contact us.
There is a tax firm out there that can help their clients pay no income tax. This tax firm is comprised of a large work force that has access to all the necessary technology tools and tax information to ensure that their clients use all the legal loopholes to bring their tax liability to zero and many times a surplus. This tax firm is so good at saving their clients tax dollars that major accounting firms even loan their employees to them!
Sounds like a great accounting right? Only one problem this accounting firm has one client...and that client is GE.
GE's Tax department is one of the most prestigious tax firms in the country. A quick Google search of "GE Tax Department" shows the efforts that GE goes through to pay no taxes.
Most small business owners don't have the resources and time to research the tax strategies like their "Big Boy" counterparts. They then go about taxes much the same way most personal taxpayers do, taking the last minute "SALY" approach. Learn more about "SALY" here.
Approaching taxes as a routine is ok, if your routine is done on a consistent basis. But even a consistent routine has small changes. Take your morning routine for instance. You may get up at the same time every day, but is the same song playing when you wake, or do you have the same breakfast every morning? The same goes for your tax planning routine. There is a consistent guide that you follow, but you must always monitor for the changes. This includes staying up to date on tax changes, and how they affect your business decisions during the year.
There are quite a few tax issues affecting small businesses currently. From the changes in depreciation, and deduction rules to healthcare now is the time to take advantage of tax strategies for main street businesses like yours.
It's doesn't take having a large tax firm as your tax department to save your hard earned money, but it does take some work (with a little help from a tax expert friend like us :-).
So do like "Nike" the Goddess of motivation/implementation and "just do it".
As the Independence Day 4th of July celebrations are being finalized for later this week, I got to thinking about the feeling I had as an entrepreneur the day I claimed independence from the typical route and set out on my own destiny. Being an entrepreneur can provide a person with the ability to be independent but that can be both an asset and a liability.
On the one hand you get to make all the decisions. Many of those decisions are made however with either little to no knowledge of the situation or the effects of those choices made (especially in the early stages of a business). Typically when decisions are made in this manner, a setback (or as some would call it a learning experience) occurs.
We have learned, from taking a look back at history, the main reason we celebrate Independence Day is due to the tax burden placed on American colonists by the British. Taxes have always caused many small business owners grief. In a recent report by Paychex, a leading payroll provider; 47% of small business owners ranked taxes as the largest issue impacting them in 2014. If that includes you, then now is the time to claim your tax independence.
So in between the plates of hot dogs, ribs and watching the fireworks, download the "Tax Independence Survey" below and stop making the expensive tax mistakes that keep many entrepreneurs and small businesses worried about their tax future. The survey focuses on key areas of your life (business and personal) where there may be tax savings that you can use to celebrate more holidays (maybe Christmas in July) with your family. Then after the holiday contact us so we can begin implementing some of the tax strategies.
We hope you have a safe and happy Independence Day 4th of July celebration.
While getting in my morning run at the local high school track, I came across a notice informing parents that summer football camp would be starting next week with practices starting at 7am -1pm (have to start early with the hot summer days in the south). This got me thinking about how many high school football teams prepare for the upcoming season with summer practices, cardio and strength training and of course class work (except in this case it’s watching film and learning the playbook). As you can see, many high school football teams are not taking off this summer.
Another team that is not taking off for the summer is the IRS, and it seems that their playbook gets more complicated year after year. As a small business owner, you need to also “train” in the off-season so that your small business will be ready. Just like the football team, preparation before the season is a key component to success. You need to come up with tax strategies in your playbook to save your hard earned money. The summer is not the time to take off so use the “down” time and the calendar to your advantage.
The summer football camp also got me thinking about a tax strategy that can help small business owners pay for the football camp via income shifting to their kids (add this one to your tax strategy playbook). Hiring your kids in your small business will shift income to a lower tax bracket and at the same time allowing the football camp payment to be a business expense. For more details on hiring kids in your small business be sure to read the chapter, How Employing Family Can Cut Taxes in my book “Expensive Tax Mistakes That Cost Small Business Owners Thousands” on Amazon.
So use the summer to your advantage as a small business owner and hire your kids. Just be sure that their work schedule does not conflict with football camp.
With the Memorial Day holiday in the rearview mirror, many small business owners and entrepreneurs and busy planning their holiday vacations and many other summer activities. Another planning activity that really needs to be on every small business and entrepreneur’s list is tax planning. If you are like most small business owners and entrepreneurs, you waste thousands of dollars every year in taxes you don’t need to pay. You then grumble about it on April 15 . . . then wait until next year to get smacked again…you see a pattern here.
The sad truth is, it doesn’t matter how good your tax accountant (let’s call him “Fully Depreciated Frank”) is with a stack of receipts on April 15. The key to beating the IRS is tax planning. The summer is a great time for tax planning.
As a small business owner and entrepreneur, has “Fully Depreciated Frank” contacted you with answers to all of these questions?
If not, you need to go to Amazon and get our new book “Expensive Tax Mistakes That Cost Small Business Owners Thousands”. The book reveals the mistakes and missed opportunities that can cost you thousands in tax; then shows you how proactive tax planning can rescue those wasted dollars.
Stop by Amazon now and stop making those expensive tax mistakes that make you hotter than the summer heat.
We all know a happy employee can increase your bottom line. Today on the local #FOX5ATL morning show there was a segment about the new Fortune 100 list of best places to work and the reasons these companies made the list (citing a happy work environment, fair pay, perks, benefits). Of course we are talking about large corporations, because as small business owners and entrepreneurs, OUR business is the best place to work so give yourself a pat on the back small business owners and entrepreneurs you made the list!
The morning show probed deeper on their social media network's "Question of the Day" asking what kinds of perks would people like. The answers were typical and pretty much validated the Fortune study. Mind you I am listening to this in the background as I manage the workflow of the early season tax returns in our virtual office....wait is that a perk?
The question did get me thinking of ways small business owners can make their businesses the best place to work for them and their employees. one of the major ways is to offer benefits and perks to you and your employees, however many small business owners and entrepreneurs do not offer benefits because they think they are to expensive and/or difficult to implement.
Did you know that by not offering perks and benefits your are more likely than not losing money instead of saving it? By offering perks and benefits you and your employees will have the opportunity to write off many of the expenses that you currently can't (or have been capped by the IRS).
Making the most out of your tax deductions, credits and income shifting are just a few of the tax strategies outlined in my recent book Expensive Tax Mistakes That Cost Small Business Owners Thousands that can be found on Amazon. Be sure to pick it up and find ways to offer perks and benefits that will keep you and your employees on the list of best places to work.
The day to give "Thanks" is behind us and the holidays are in full swing. Millions of Americans are kicking off the season with “Black Friday” shopping. Braving the crowds and the cold, facing scorn from family they’ve left behind, they line up at obscenely early hours (or duck out of Thanksgiving dinner before the pumpkin pie is even served) to save $20 on a iPad or $40 on a flat-screen television.
It’s sad, but true, that most Americans spend more time planning their “Black Friday” shopping than they spend planning their taxes. But that can be an expensive mistake!
What if the IRS had a sale? What if the IRS let you discount your taxes by thousands of dollars, this year and every year to come? And what if they let you do it from the comfort of your home or your office, without lining up in the pre-dawn hours of a chilly November morning? Would you give thanks for a sale like that?
You’re probably not holding your breath for the scrooges at the IRS to hold a “sale.” The good news is, you don’t have to wait for that to happen. You just need a plan. Tax planning is the key to paying the legal minimum. And a good tax plan can pay for a holiday season full of gifts and fun.
Now is the season to find the mistakes and missed opportunities that may be costing you thousands. “Black Friday” tax planning before the year end can save thousands more off your taxes in the future. There are 31 days left for "Black Friday" tax planning. Contact us for ways to save on your taxes before the end of the year.
Many say that Friday the 13th is an unlucky day and today may be one of those days for taxpayers. It would appear that the IRS is playing the role of Jason Voorhees and are performing an all out massacre on the many tax deductions individuals and small business owners rely on to save money on their tax returns. Here are 13 (unlucky) tax deductions that the IRS will slaughter like Jason did the kids at Camp Crystal Lake by year end.
Don't want to be caught by the slashing machete of the IRS? Now is the time to put a plan in action so you will still be alive when the credits roll at the end of 2013. Time is ticking...
See how much time you have left here.