Driving Deductibles with IRS Standard Mileage Rates

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If you’re a small business, knowing how, what and when to deduct for business use of your company vehicles can make a big difference in your tax rates at the end of the year. The Internal Revenue Service has issued its 2015 optional standard mileage rates for business, charitable, medical or moving uses. Here’s what you need to know now to make the most of the deductions. Every year, the IRS sets standard mileage rates for business based on an annual study of fixed and variable costs of operating an automobile, including depreciation, insurance, repairs, tires, maintenance, gas and oil. Rates for medical and moving purposes are based on variable costs like gas and oil. You need to keep in mind a few points when considering whether deductions apply to you: Business miles are miles you’ve driven specifically for business (e.g., to meet with a client or your accountant) Business miles are NOT miles driven between home and your workplace – those are commuting miles, and are not … [Read more...]

How to Handle 2014 Tax Planning in a Lame Duck Congress

November ushered in the 2014 lame duck session of the 113th Congress. It has implications for everything from Ebola, to immigration, to tax breaks. While all of these issues are pressing, for expanding and emerging businesses and their owners, it is those pieces of tax legislation that imply direct, material impact. What is a lame duck?  Let’s start from the top. What is a lame duck? It’s a funny term for a not-so-amusing situation. A lame duck is a politician who is on his or her way out of office (currently, there are 85) and who therefore is unable to effect change. A lame duck session is the window of time during which one Congress meets after its successor is elected, but before the new Congress convenes the following January. The 2014 lame duck session is significant because Democrats are the sitting members of the existing Congress, and the new Congress has a Republican majority. Change is afoot, and there is real concern about whether they will be able to get anything … [Read more...]

1099s Repealed for Corporations! So Do You Need to File Them at All?

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By Stacey Gorowitz, CPA, MBA Although the IRS officially repealed the onerous expanded information reporting requirements for payments made to corporations, the stakes are higher with enhanced penalties for failing to file 1099s when required. Here’s a brief summary explaining when and to whom you do need to file Form 1099 for 2013: When: 1099s are required to be sent to vendors by January 31, 2014 and the corresponding 1099s and summary form 1096 are required to be sent to the IRS by February 28, 2014. Who: All individuals and partnerships including certain corporations to whom you’ve paid $600 or more during the year must be issued a 1099. Individuals would include nonemployees (EX:  Day laborers or subcontractors), etc. Additionally, 1099 reporting is also required for: Rental payments for office space, as well as equipment and machinery. Royalties paid of $10 or more are also included in the 1099 reporting requirement. There are a few exceptions to the general … [Read more...]

If You Fail to Plan…Plan to Pay Taxes!

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By Candace Spencer, CPA, MAFM and Certified QuickBooks ProAdvisor Have you ever been surprised with a large tax bill? When is the last time you received tax planning and/or projections and knew where you stood before year-end? Do you realize that those two questions are closely related? By getting solid financial information and acting on it in a timely fashion, you can prevent unpleasant surprises come filing season. With December right around the corner, time is running out. The good news is that it’s not too late; however, it’s now a race against the clock. If you need more motivation to start thinking about such annoyances as taxes this far before April 15, here are three reasons why you may want to consider tax planning. First, if you haven’t already heard, there have been major changes in the tax law for 2013. Therefore, you can expect the 2013 tax year will NOT be like last tax year. Here are just a few changes you need to be aware of: In 2012 100% of itemized deductions … [Read more...]