The Tax Implications of Dual Citizenship

Many individuals either contemplate or hold citizenship in more than one country. While dual citizenship can offer many benefits, such as enhanced travel mobility, access to social services, and the ability to work and reside in both countries, be sure you are aware of the tax responsibilities. As a current or potential U.S. citizen, you […]

Qualified Improvement Property: What You Need to Know

You need to think about the sale of your rental property when you claim depreciation on your qualified improvement property (QIP). Gains may be subject to higher-than-expected tax rates due to Sections 1245 and 1250 ordinary income recapture and other factors. Planning your depreciation methods can significantly impact your current tax liabilities and long-term taxable […]

Estimated Tax Penalty: What Is It & How To Avoid

Estimated Tax Penalty

The United States has a “pay as you go” tax system in which payments for income tax (and, where applicable, Social Security and Medicare taxes) must be made to the IRS throughout the year as income is earned, whether through withholding, by making estimated tax payments, or both. You suffer an estimated tax penalty if […]

Working Overtime? Don’t Miss Out on this Fringe Benefit

Working Overtime

Tax law often discriminates against company owners, granting them no or fewer fringe benefits. But you, the owner, are not discriminated against when it comes to supper money. It works like this: That means you can take this benefit for yourself, even as a sole proprietor. You also qualify for this benefit if you operate […]

What To Do with an Overfunded 529 College Savings Account

You can accumulate federal income-tax-free earnings with a Section 529 college savings plan account. Then, you can take federal-income-tax-free withdrawals to cover qualified education expenses, usually for college. Great! But what if your designated account beneficiary decides not to attend college? What are your options, and what are the federal income tax consequences for those […]

How You Could Gain Tax Advantages Through A Business Gym

If you have been thinking about employee fitness and possibly a gym or other athletic facility, keep reading! To be tax deductible, your gym or other athletic facilities must be primarily for the benefit of your employees—other than employees who are officers, shareholders, or other owners who own a 10 percent or greater interest in […]

Don’t Make These Common Mistakes When Converting to an S Corporation

At first glance, the corporate tax rules for forming an S corporation appear simple, but be careful! Basic Requirements Here is what your business must look like when it operates as an S corporation: Simple, right? But what often appears simple on the surface is not so simple at all. Don’t Forget Your Spouse If […]

You Can Deduct 100% of Your Employee Entertainment Events

When you know the rules, you can have fun with your employees and deduct 100 percent of the cost. The IRS says that the following types of entertainment qualify for the 100 percent employee entertainment tax deduction: The IRS makes it clear that the above are examples, and that other types of entertainment may also […]

Don’t Miss Out on the Home Internet Deduction

If you do some work at home, you’re probably using your home internet connection. Are your monthly internet expenses deductible? Maybe. The deduction rules depend on your choice of business entity (proprietorship, corporation, or partnership). Deduction on Schedule C If you operate your business as a sole proprietorship or as a single-member LLC, you file […]

Strategies for Beating the Net Investment Income Tax

Net Investment Income Tax

Here is some important information regarding the net investment income tax (NIIT), which may be relevant to your financial situation. NIIT Overview The NIIT is a 3.8 percent tax that could apply if your modified adjusted gross income (MAGI) exceeds $200,000 (single filers), $250,000 (married, filing jointly), or $125,000 (married, filing separately). It targets the […]

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