Blog
2022 – 08/22

2022 – 08/22

Taxpayers who operate a business can generally deduct business-related costs on their income tax returns. But they must keep thorough, contemporaneous records proving that the deductions are for legitimate business expenses. An information technology consultant and handyman deducted the cost of professional education on his return. But the IRS found the amounts weren’t business-related because… Continue Reading

Is your withholding adequate? Here’s how to check

Is your withholding adequate? Here’s how to check

When you filed your federal tax return this year, were you surprised to find you owed money? You might want to change your withholding so that this doesn’t happen again next year. You might even want to adjust your withholding if you got a big refund. Receiving a tax refund essentially means you’re giving the… Continue Reading

2022 – 08/18

2022 – 08/18

The U.S. government has begun issuing guidance regarding the Clean Vehicle Credit in the new Inflation Reduction Act (IRA). The IRA introduced a $4,000 tax credit for the purchase of used EVs and updated the $7,500 credit for new ones, with major changes. To qualify for the credit, there are now new requirements, including caps… Continue Reading

Estimated tax payments: Who owes them and when is the next one due?

Estimated tax payments: Who owes them and when is the next one due?

If you don’t have enough federal tax withheld from your paychecks and other payments, you may have to make estimated tax payments. This is the case if you receive interest, dividends, self-employment income, capital gains or other income. Here are the applicable rules for paying estimated tax without triggering the penalty for underpayment. When are… Continue Reading

2022 – 08/16

2022 – 08/16

Even IRS penalties are affected by inflation. The IRS just announced that fourth quarter 2022 interest rates for tax overpayment and underpayment will increase by 1%. The interest rate for overpayments will be 6% for most taxpayers and 5% for corporations. If a corporation overpays by more than $10,000, the rate will be 3.5%. The… Continue Reading

2022 – 08/25

2022 – 08/25

On Aug. 24, President Biden announced a plan for student loan debt relief. The three-part plan may affect nearly 8 million borrowers. Part one will allow $20,000 of debt forgiveness for taxpayers who went to college on a Pell Grant or $10,000 without a Pell Grant. This applies only to taxpayers earning below $125,000 a… Continue Reading

Inflation enhances the 2023 amounts for Health Savings Accounts

Inflation enhances the 2023 amounts for Health Savings Accounts

The IRS recently released guidance providing the 2023 inflation-adjusted amounts for Health Savings Accounts (HSAs). High inflation rates will result in next year’s amounts being increased more than they have been in recent years. HSA basics An HSA is a trust created or organized exclusively for the purpose of paying the “qualified medical expenses” of… Continue Reading

2022 – 07/27

2022 – 07/27

Businesses must withhold employment taxes from employees’ wages and report the wages and the taxes withheld to the IRS. But the reporting obligations for workers who aren’t employees can be trickier. While a business isn’t responsible for withholding employment taxes from nonemployee (or independent contractor) compensation, a business that pays more than $600 to an… Continue Reading

Three tax breaks for small businesses

Three tax breaks for small businesses

Sometimes, bigger isn’t better: Your small- or medium-sized business may be eligible for some tax breaks that aren’t available to larger businesses. Here are some examples. 1. QBI deduction For 2018 through 2025, the qualified business income (QBI) deduction is available to eligible individuals, trusts and estates. But it’s not available to C corporations or… Continue Reading

Email Scam

Email Scam

Students and staff at educational institutions, beware. An IRS impersonation scam continues to target schools, including people with “.edu” email addresses. This applies to public, private and nonprofit schools. The suspect emails display the IRS logo and may refer to a “tax refund” in the subject line. The sender then tells recipients that, to claim… Continue Reading