Tax Benefits of Hiring Your Child
You can pay your child to work in your business and get paid for paying your child. The basic mechanics of this are (a) you deduct the wages and (b) your child pays zero or very little in income taxes. The three points below elaborate on this: The child (a single taxpayer) pays zero taxes on earnings up to the [...]
Retirement Savings Mistakes to Avoid
Make one or two mistakes in handling your retirement money, and you could be paying a stiff penalty later in your life. The stock market goes up and down, but you’ll survive if you stay clear of these common mistakes: Obsessing about market losses: Focus instead on your long-term needs. Catastrophic events and long-term health care needs cause as much [...]
Avoid Recapture Tax When Selling Your Home
As you likely know, the depreciation you claim with your home-office deduction is subject to a recapture tax when you sell your home. How would you like to not pay the recapture tax? You may be able to do just that by following one easy step when it comes time to sell your current home and buy a replacement. When [...]
What’s Miscellaneous Deductions?
What do we mean by “miscellaneous deductions”? Miscellaneous deductions are tax breaks that generally don’t fit into a particular tax category. They can help reduce taxable income and the amount of taxes owed. For example, some employees can deduct certain work expenses like uniforms as miscellaneous deductions. To do that, they must itemize their deductions instead of taking the standard [...]
Get Tax Deductions by Renting Your Home to Your Business
We think you will find this story most interesting. It goes like this: Steve's tax professional tells him that IRC Section 280A allows him to rent his entire home to his S corporation for 14 days or less during the year and get big tax deductions. In the example, the tax professional explained that Steve could charge his S corporation [...]
Tips to Avoid IRS Audit for Small Business
Let’s face it - nobody wishes for extra attention from the IRS. Most of us probably wish they’d forget we ever existed! Next year, the IRS may be paying special attention to the following three taxpayer issues. If you want to avoid an audit, keep your nose clean on these points: Omitting Business Income Don’t do it. Be sure to [...]