FREE NEWS ALERTS
A free, comprehensive news service to keep small businesses and independent contractors posted on the latest tax developments affecting their operations.
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Senate Fails to Pass Payroll Tax Cut Extender as End of Year Draws Nigh
With the current payroll tax cut facing a Dec. 31, 2011, expiration date, the Senate this week failed to pass two versions of a proposed extension, raising the prospect that the taxes are about to return to their earlier, higher level for small businesses and their employees unless Congress intervenes.
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Repeal of Controversial Contractor Withholding Tax Now a Done Deal
Life just got a little easier for start-ups and small businesses that depend upon contract work from Uncle Sam, now that elected officials in Washington, DC, have gone ahead and repealed the 3 percent withholding tax on government contractors who owe back taxes.
The repeal of the 3 percent withholding tax passed with unanimous votes in both the House (in late October) and the Senate in November, with President Barack Obama signing the bill into law in mid-November.
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Policymakers Try to Encourage Small Businesses to Hire Vets
Two new tax cuts aimed at encouraging small businesses and other employers to hire a new generation of war veterans were approved by Congress the day before Veterans Day.
The Returning Heroes and Wounded Warrior Tax Credits were then signed into law by President Obama on Nov. 21, and offer three tiers of cuts based on the length of time the veteran has been out of work and whether the returning soldier faces debilitating injuries from combat.
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LAST CALL for End-of-Year Tax Planning, Maneuvers
In the two previous issues, we’ve identified a number of tax-planning steps you can take as the end of the year approaches that can help you maximize your deductions and minimize your tax liability, along with a number of steps you might not have previously considered.
This month, we’re passing along a number of miscellaneous, yet potentially significant, things you can do to help your tax-related bot-tom line.
Don’t forget, you shouldn’t avoid paying taxes, but you should avoid paying too much!
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Health Care Reform Act Compels Opponents to Press for Relief
The Patient Protection and Affordable Care Act of 2010 continues to draw complaints from small businesses as well as trade groups that support their interests, a number of which continue to actively lobby for a full repeal or at least a major overhaul.
The National Federation of Independent Business has continued its campaign against the Health Insurance Tax Credit, part of the Patient Protection and Affordable Care Act. The small business trade group has concluded that the measure offers “little incentive to purchase health insurance for small firms not currently offering coverage.”
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Small Business Experts Call for Greater Tax Code Simplification
A recent Congressional hearing emphasized the urgency that business owners and legislators sense in reforming the tax code in such a way that takes into consideration the fact that more than 90 percent of small businesses in the country are organized as pass-throughs.
A mixture of economists, business owners and trade group representatives spoke in front of the Committee on Small Business recently to explain how the complexity of the tax code negatively affects their and…
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Types of Taxes – Alternative Minimum Tax #106
The alternative minimum tax attempts to guarantee that all individuals pay at least a minimum amount of tax.
Tax laws give favored treatment to certain kinds of income and allow special deductions and credits for certain kinds of expenses. The alternative minimum tax attempts to guarantee that individuals who benefit from these tax advantages pay at least a minimum amount of tax. The alternative minimum tax for individuals is a separate system of income taxation that operates parallel to the regular income tax.
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Types of Taxes - Capital Gains and Losses #102
Just about everything you own and use for personal or investment purposes is a capital asset. Examples are household furnishings, your home and stocks or bonds you personally own. You have a capital gain or a capital loss whenever you sell a capital asset. The difference between the amount you sell it for and your cost or basis determines whether you have a capital gain or a capital loss.
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Expenses – Travel #102
Most expenses associated with normal business travel are tax deductible. These include costs associated with transportation, baggage and shipping, operating a vehicle, meals (subject to limitations) and lodging, dry cleaning, telephone calls, and tips.
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Expenses – Charitable Contributions #112
Contributions made to charitable organizations technically do not qualify as a business expense eligible for a federal tax deduction. Nevertheless, the IRS does allow most corporations – with the notable exception of S corporations – to deduct charitable contributions on their corporate income tax returns, subject to some limitations.
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Benefit Plans – Affordable Care Act #103
The Affordable Care Act was enacted on March 23, 2010. The law has some tax provisions that take effect in 2011 and others that will kick in over the next few years. The following is a list and summary of provisions currently in effect for small businesses. Additional information will be added to this brief as it becomes available.
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Depreciation Methods, #103
The depreciation method that you use for any particular asset is determined at the time you first place that asset into service. Whatever rules or tables are in effect must be followed as long as you own the property. Since Congress has changed the depreciation rules many times over the years, you may have to use a number of different depreciation methods if you have business property that was acquired at different times. …
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Benefit Plans - Health Savings Accounts, #101
To help small business owners and their employees cope with the escalating cost of health care, the federal government established Health Savings Accounts in 2003. These accounts – which combine tax-free savings with high-deductible insurance coverage – are designed to receive tax-exempt contributions, are portable from job to job, and may be accumulated over the years or distributed on a tax-free basis to fund qualified medical expenses. Other approaches include Medical Savings Accounts, Health Flexible…
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