Thursday, December 31, 2015

Take control of holiday spending

Take control of holiday spending

Exchanging gifts, entertaining family and friends, and extending goodwill to others are the activities that make holidays joyful. But sometimes the enjoyment is followed by financial headaches. January's bank statements and credit card bills bring the unhappy realization that you lost control of your finances.
How can you prevent this financial hangover? Start with a budget. Estimate the cost of what you plan to purchase. Include gifts, holiday decorations, entertaining, and special events. If the total cost is manageable, stick to your budget as you shop.
But what if the cost grows – and grows some more? There's no need to resort to miserly behavior to trim that out-of-control gift list. One option is to draw names of family members and give one nice gift to each person, rather than multiple small gifts to everyone. Elderly relatives might appreciate "gift certificates" that can be redeemed for your help with home or garden chores. Other cost-saving ideas: make or bake gifts instead of buying them; give combined gifts from parents and children instead of individual gifts; agree on a spending limit with close friends.
While you no doubt want to splurge on the kids during this time of year, don't feel you have to give your children every gift they ask for. When they make their list, have them prioritize the things they really want. At the store, take a lesson from your own childhood, when your favorite gifts were simple toys that encouraged you to use your imagination.
Remember, too, the holidays are more than gift-receiving time. Create a family tradition of choosing and wrapping a present for those less fortunate. Encourage your children to make gifts for family and friends. Arrange family outings and fun activities so the holidays become a series of enjoyable events.

An emphasis on holiday experiences in place of shopping extravaganzas will let you enjoy the season more – both this month and next, when the bills come due.

Tuesday, December 29, 2015

Do you know who you're giving to?

Do you know who you're giving to?
Many charities use your donations wisely. Unfortunately, others spend too much of your contribution on fundraising and administrative expenses. Some even misrepresent themselves and solicit your money for phony causes. In today's world, investigating a charity before you make a donation is wise. Here's a checklist of precautions.
Request written documentation about the charity's mission and how your contribution will be spent. Ask for proof that your donation is tax deductible. If a charity is reluctant to provide information, think twice about making a gift.
When you receive a phone solicitation, the caller must provide his or her name, the name of the person or entity on whose behalf the call is being made, and a telephone number or address at which that person or entity can be contacted. If a caller refuses to give you this information, hang up. Report the call to local authorities to help protect others.
Be wary about giving your credit card number over the phone. Instead, consider mailing your contribution once you've verified that the charity is legitimate and that it represents a cause you'd like to support.
Just because an organization gives you a receipt for your records doesn't mean the organization is tax-exempt or that your contribution is tax-deductible. To find out if an organization is exempt from federal income tax and how much of your contributions to it are tax deductible, visit the IRS website at https://apps.irs.gov/app/eos.
Asking the right questions and obtaining information from and about a charity is the only way you can be sure your contribution will be used to benefit the causes and people you want to support. If we can help you sort the legitimate from the fake, give us a call.

Thursday, December 24, 2015

Give a gift that will last a lifetime

Give a gift that will last a lifetime

Financial gifts can bestow benefits for many years to come. Here are options to consider.
 
Fund an IRA. Give your children or grandchildren an early start on a comfortable retirement. For 2015, you can contribute the lower of $5,500 or the earned income of the child to an IRA.

Fund a 529 education account. Contributions to a Section 529 college savings plan grow tax-free and withdrawals are tax-free when used to pay qualified education expenses of the account beneficiary.

Fund a Coverdell education savings account. You can contribute up to $2,000 annually to a Coverdell. These IRA-like accounts grow tax-free, though the total amount of your gift may be limited, depending on your income.

Fund a custodial account. Want to encourage an interest in saving and investing? Buy shares in a mutual fund and combine the gift with a book on investing. Your child can watch the investment grow over time and enjoy dividend payouts too. Modest amounts of investment income can be tax-free to children, although the kiddie tax may apply at higher levels.


Call us to review the tax issues related to these financial gifts.

Tuesday, December 22, 2015

Take time to review the health of your business

Take time to review the health of your business

As an owner and/or manager, you probably spend a lot of time monitoring business operations and dealing with everyday problems. But a longer-term approach is also useful. Just as an annual checkup from your physician helps monitor and manage your personal health, an annual checkup can do the same for your business.
Here are tips to get started.
1. Insurance coverage. Instead of automatically writing a check to renew insurance policies when they come due, sit down with your agent. Review your business operations, focusing on any changes. Discuss types of risk that could arise. Ask about new developments in business insurance. Use your agent's expertise to identify risk areas and suggest suitable coverage.
2. Tax strategy. Consider adjusting taxable earnings for the year, perhaps by accelerating expenses or delaying income at year-end. If your business reports on the cash basis, you could boost 2015 deductions by declaring and paying bonuses in December rather than in early January. Deferred invoicing or early purchases can also reduce your 2015 tax bill.
3. Customer survey. Track customer satisfaction with an online survey. Focus on questions that reveal how well your company performs in areas such as prompt service, staff responsiveness, and understanding of customers' problems. Ask your customers for insight on potential new products or services, and let them know how much you value their business.
4. Marketing review. Are your current methods and channels working well, or are you simply doing what you've always done?
5. Succession planning. Do you have a specific plan for each key managerial position, including yourself? Are you prepared for a short-term absence or a permanent vacancy? Your plan might point out the necessity of promoting from within or recruiting externally.
6. Banking relationships. Meet with your banker. Ask about new products or services that could help your company. Address service concerns or problems that occurred during the year. Look for ways to reduce idle cash, boost interest earned, and improve cash flows.

An annual business checkup can help you evaluate current performance, better manage and execute future operations, and provide a plan for keeping your business on track. If you need assistance, give us a call.

Thursday, December 17, 2015

Get a head start on your Form 1099 reporting

Get a head start on your Form 1099 reporting

No matter what type of business you operate, January is busy. You're trying to get your business off to a good start in the new year, you're closing the books on last year, and you have to complete payroll and 1099 forms by month-end. Why not make time this month to get a head start on at least one of those chores?

You can lay the groundwork now for a common information return known as "Form 1099-MISC, Miscellaneous Income." You use Form 1099-MISC to report payments to non-employees. The list of payments includes fees to independent contractors for services, such as consulting, web designing, accounting, and legal. Generally, you don't need to report amounts you pay to corporations, but there are exceptions. For example, you must report payments to all law firms, whether the firm is incorporated or not.

Here's the information you need to start assembling to complete Form 1099-MISC: the name and address of vendors you paid in the course of your business, the taxpayer identification number of each vendor, and verification of corporate status. The best way to collect this information is to use "Form W-9, Request for Taxpayer Identification Number (TIN) and Certification." Send a copy to all vendors and ask them to complete and return the form to you. When you get the form back, keep it with your records. The IRS doesn't need a copy.

In order to save time in the future, establish a policy to request Form W-9 from a new vendor whenever you sign a contract.


Contact our office if you need more information.

Tuesday, December 15, 2015

Poor recordkeeping means lost deductions

Poor recordkeeping means lost deductions

What's worse than keeping records? Losing tax deductions because you didn't keep records. Tax court cases routinely deal with "unsubstantiated" expenses – business costs that taxpayers claim but cannot prove – and taxpayers routinely lose. Every legitimate and supported deduction can save you tax dollars. As the end of the year approaches, take time to make sure your records are in order. Don't want to deal with reams of paper? Software programs and apps can ease the burden. Give us a call for suggestions on how to improve your recordkeeping

Friday, December 11, 2015

Check unclaimed property lists for missing money

Check unclaimed property lists for missing money

Discovering unexpected money is always a pleasant event and generally even more so this time of year. You don't need to dig between the couch cushions to find it. According to the National Association of Unclaimed Property Administrators (NAUPA), state governments have $41.7 billion in unclaimed property on their books. While it may sound like a scam, you could have a legitimate claim to money such as abandoned bank accounts and utility security deposits that you forgot to collect when you moved. You can claim the funds at no cost. Start by checking http://www.MissingMoney.com, a website officially endorsed by the NAUPA

Wednesday, December 9, 2015

Did you pay domestic employees in 2015?

Did you pay domestic employees in 2015?

Nannies, housekeepers, caregivers – the people who make your home life easier – are your employees, and you're required to comply with income and payroll tax rules. For 2015, you'll need to withhold social security and Medicare taxes when you pay your worker $1,900 or more during the year. You'll also need to provide year-end tax forms and wage statements and file a special schedule with your personal federal income tax return. Contact us for details

Monday, December 7, 2015

Be aware of 2016 payroll rates

Be aware of 2016 payroll rates

The Social Security Administration announced the 2016 wage base for computing the amount of payroll tax will be $118,500, the same as 2015. The wage base is the maximum amount of wages subject to the social security portion of the payroll tax you may know as "FICA." The total FICA rate is composed of two parts and the rates for both remain the same for 2016. The social security tax portion is 6.2% of an employee's wages on amounts up to $118,500. The basic Medicare portion is 1.45% of an employee's wages, no matter the amount. Note that employers must also withhold an additional 0.9% Medicare tax on wages over $200,000.

Thursday, December 3, 2015

Will your employees stay after the holidays?

Will your employees stay after the holidays?


A survey of employees and human resources professionals showed that what employees want and what the professionals think they want may not be the same. According to the survey, one in three employees is looking for a new job. Reasons include salary levels and lack of a clear career path. If employee retention is a problem at your company, perhaps you're not aligning your business interests with that of your employees. What to do? Start by asking employees what motivates them. The survey showed employees are willing to share – if you ask the right questions.

Tuesday, December 1, 2015

Plan for changes to social security options

Plan for changes to social security options 

A recent law eliminated two social security "loopholes," but you may still be able to benefit in some circumstances. The option to apply for social security when you reach full retirement age and restrict your claim to spousal benefits will only be available if you're age 62 by December 31, 2015. The option to voluntarily suspend your benefits in order to receive them later when they would be higher will only be available until April 2016.

Monday, November 30, 2015

Take precautions to avoid gift card fraud

Take precautions to avoid gift card fraud
Gift cards are a convenient way to give your friends and loved ones "just the right thing" at holiday time. They also give thieves an opportunity to make off with your money, according to a public service announcement issued by the Federal Bureau of Investigation.

How can you protect yourself from gift card scams? Here are pointers.

• Buy directly from reputable stores. If you're getting a restaurant gift card, stop by the restaurant in person or visit their web site. That goes for airlines and big box stores too.

• Check reviews of sellers of gift cards in online auctions. There's a reason someone's selling the card at a discounted price – it may be stolen or counterfeit. Are you willing to take the risk?

• Examine the card. Before purchasing a gift card, inspect the front and back for tampering. Some cards have PIN codes that must be exposed before use. Make sure the PIN is still hidden.

• Register the card. Some issuers let you register the card at the store's web site. By registering, you'll be able to check your balance on a regular basis and identify any misuse.

Thursday, November 26, 2015

Need money to pay bills? Raiding your 401(k) is not a good idea

Need money to pay bills? Raiding your 401(k) is not a good idea

When you're short of cash, raiding your 401(k) plan may seem like a good idea. Here are two reasons why it isn't.
 
Penalties and taxes. If you're not at least 59½ years old, you'll be hit with a 10% penalty for early withdrawals except in certain limited cases, and the money you withdraw will be taxed at your regular tax rate.

Lost opportunity. If your 401(k) earns an annual return of 5% over the next 30 years, an account with a balance of $50,000 could grow to over $215,000. A withdrawal taken and spent today will cost you that growth.

Bottom line: If possible, find other ways to pay your bills, even if that means contributing less to your 401(k) in the short term. While it's wise to match funds your company provides, you might consider temporarily reducing contributions that exceed the matching amount.

What about loans? A 401(k) loan also has drawbacks. Again, money that's not in your account won't grow. In addition, if you lose your job, you'll have to repay the outstanding loan balance or face tax penalties.

If you need assistance with financial issues, give us a call.

Tuesday, November 24, 2015

Seek liquidity for short-term investments

Seek liquidity for short-term investments

The stock market may not be the right place for all of your money at all times. Here are two situations when cash accounts can be a better solution.

Situation #1. Generally, the stock market is not a good place to invest funds you will need during the next two to three years, such as when you need to pay ongoing living expenses in retirement. In that case, the money you'll need would be better stashed in stable investments such as money market funds, bank CDs, or bonds with maturities matched to your needs. The idea is to eliminate the risk that you'll be taking withdrawals when the stock market is depressed.

Situation #2. Your emergency fund – three to six months of current living expenses – has one purpose: to provide the money you might need for crises such as job loss, illness, or major unexpected repairs. These are situations when you can't afford to wait until the market recovers to get your funds.


Cash savings do carry risks, such as losing purchasing power during times of inflation. And historically, the stock market has provided superior returns over long time periods. But those returns come at the price of volatility. If you need to withdraw your savings during a market downturn, you might not recover your investment. Wherever you choose to invest your other savings, consider keeping some of the funds you will need in the short-term in less volatile, old-fashioned cash investments.

Thursday, November 19, 2015

Good communication keeps your customers happy

Good communication keeps your customers happy

As a business owner, you know how much effort goes into attracting new customers. So once you've found a new customer, you want to keep that customer as long as possible. Good communication can help. Make your customer feel known, understood, and appreciated at every stage of the relationship – before the sale, while you're reaching a deal, and after you've concluded the sale.

• Before the sale. Get to know your customer's needs. In a retail setting good communication means greeting customers by name and learning their preferences. Train your employees to offer help, answer questions readily, and suggest new or alternative products. In other businesses, make regular calls or visits to a prospective customer, even if no sale is imminent. Use the opportunity to build relationships.

• Making the sale. Honest communication while you're making a sale can be key to keeping a customer loyal and happy. Be forthright about terms and conditions. Avoid over-promising, as that leads to disappointment down the road.

• After the sale. Contact customers after the sale. Follow up with a call to ask if they're satisfied with the purchase. Communication at this point shows customers they're appreciated, and is a great opportunity to deal with complaints. If there is a problem, communicating well can help resolve dissatisfaction and create a loyal and appreciative customer.


Remember, your customers are buying an experience as well as your product or service. Good communication can make them want to repeat that experience.

Tuesday, November 17, 2015

Are you 65 or older? Include these tax breaks in year-end planning

Are you 65 or older? Include these tax breaks in year-end planning

Celebrate your 65th birthday with federal income tax benefits. Here are some of the breaks available once you reach age 65.

Higher standard deduction. Your standard deduction is the sum of the basic standard deduction plus an additional standard deduction if you are age 65 or older at the end of the tax year. You are considered to be 65 on the day before your 65th birthday. For your 2015 tax return, you can add an extra $1,550 to your standard deduction if you're single. If you and your spouse are both 65 or older, your combined extra deduction is $2,500.

Tax credit for the elderly. You may qualify for this direct reduction of your federal income tax if you're age 65 or older. There are limitations if tax-free pension benefits such as social security exceed certain levels. Income limitations may also apply.

Medical expense deduction. Generally, when you itemize, unreimbursed medical expenses can be deducted only when they exceed 10% of your adjusted gross income. However, for 2015, when you're 65 or over, you can deduct medical expenses that exceed 7.5% of your income. Are you married? Only one spouse needs to be 65 or older to qualify.


Please contact our office to make sure you're receiving all the tax breaks for which you qualify at any age.

Friday, November 13, 2015

Some tax benefits will increase in 2016

Some tax benefits will increase in 2016

 Each year, the IRS announces inflation adjustments for more than 50 tax provisions. Knowing these numbers can help with your year-end tax planning. Changes for 2016 (for the tax returns you'll file in early 2017) include an increased standard deduction when you file as head of household ($9,300 for 2016). The standard deduction amounts remain the same as they were for 2015 when you're single or married filing separate ($6,300), or married filing jointly ($12,600). Please call us about other inflation adjustments.

Wednesday, November 11, 2015

Make use of your 2015 gift tax exclusion

Make use of your 2015 gift tax exclusion

This year you can give up to $14,000 to as many individuals as you want without any gift tax liability. If you're married and your spouse joins in the gift, you can, as a couple, elect to give $28,000 to each person with no gift tax liability. Once December 31, 2015, has come and gone, your 2015 gift tax exclusion is also gone. If you plan to make gifts this year, remember that your gifts must be completed by then.

Monday, November 9, 2015

Should you increase your withholding?

Should you increase your withholding?


Will the federal income tax withheld from your wages be enough to meet your 2015 federal income tax liability? If not, you can choose to make estimated tax payments. However, you should be aware that the penalty rules for underpayment of estimated taxes is applied to each installment – meaning you may owe a penalty when your estimated tax payments (plus withholding) total less than 25% of your required annual payment. Increasing your withholding for the last two months of the year can help you avoid this penalty. Contact us to learn how the estimated tax rules apply to you.

Thursday, November 5, 2015

Tax planning is good for corporations too

Tax planning is good for corporations too

 If you own a calendar-year corporation, you can benefit from planning moves you make before December 31. For example, corporations can accelerate or defer income or deductions to stay within a certain tax bracket. You'll also want to look at your corporate alternative minimum tax exposure to determine whether you qualify for an exception to the tax. Finally, reviewing estimated tax payments can save penalties. Call us for more business planning strategies.

Tuesday, November 3, 2015

Be aware of credit card "liability shift"



Be aware of credit card "liability shift"

Does your business accept credit cards? You may already know of the recent update to a new style of cards embedded with microchips. This new technology, also known as EMV (for Europay, MasterCard, Visa), makes credit card fraud more difficult. Your business is not required to move to the new technology to process these cards. But you should be aware that as of October 1, 2015, your business is responsible for some fraudulent transactions that were previously covered by the cardholder's bank. Give us a call for details.

Sunday, November 1, 2015

2016 health care enrollment begins November 1

2016 health care enrollment begins November 1

The health insurance Marketplace (www.healthcare.gov) "open enrollment period" began November 1 for 2016 individual health insurance coverage. Open enrollment is the annual period of time during which health insurance companies must accept your application regardless of your health history. Once open enrollment is over – January 31, 2016, for 2016 policies – you can only get coverage if you have circumstances that allow you to qualify for a special enrollment period.

Friday, October 30, 2015

Turn your part-time employees into winners

Turn your part-time employees into winners.
Part-time employees play a valuable role in a small business. They help deal with fluctuations in workload and can job-share with full-timers. In addition, because part-timers often look for flexibility in hours, you may find a skilled worker whose schedule fits perfectly with existing staff.
But part-timers can turn into a liability if not managed well. You could end up with poorly motivated workers who are unsure of their duties, unfamiliar with your company, and uncertain who they report to. Here are tips to keep this from happening.
Think before you hire. Decide what you want your new employee to do, what work hours are expected, and who he or she will report to. Does the position have well-defined duties? Or does the work involve filling in wherever needed? Decide on the pay and benefits.
Communicate clearly with your new part-timer. Explain the required duties and the chain of authority. Be very clear on hours and benefits, while remaining flexible enough to accommodate school or other commitments.
Communicate clearly with your full-time staff. Explain why you're hiring a part-time employee. Clarify what the new employee will and will not be expected to do. Designate who will manage and assign work to the part-timer.
Make the part-timer feel like part of the company. Provide introductory training on specific duties and the company's business and policies. Assign a mentor or "buddy" – someone the new person can turn to with everyday questions.
Monitor progress. Don't forget about your new employee after hiring. Provide feedback on performance and recognition for tasks well done.
With a sound plan, hiring a part-time employee can be a win-win situation.

Wednesday, October 28, 2015

Breakeven analysis helps with business choices

Break even analysis helps with business choices


Break even analysis is an important and useful tool in business. Whether you're starting a new business, expanding current operations, contemplating an acquisition, downsizing, or approaching banks and other potential lenders, you'll want to know your break even.
Break even is defined as the point at which costs equal income – no profit, no loss. It's an excellent starting point for finding out where your business is and where it can go. Break even is the first step in planning future growth. It shows how much sales volume you need to cover fixed and variable expenses. Once your company has reached break even, all gross profit beyond that point goes directly to improving the bottom line.
Of course, break even analysis has limitations. For example, it ignores the importance of cash flow and makes the assumption that fixed and variable expenses will stay within the parameters used to calculate the break even point. Despite these shortcomings, break even can help with business planning.
Here's how to calculate your business's break even.
First, review your annual financial statement to learn your fixed and variable expenses. Fixed expenses are those that don't generally vary in relation to sales volume. Rent, for example, usually stays constant no matter the amount of your sales. The same is typically true for depreciation, utilities, and insurance.
Variable expenses are the cost of goods sold and other costs of sales, such as direct labor and sales commissions.
What about costs that are part fixed and part variable? Split these into separate categories based on your knowledge of your business.
Next, compute your gross profit percentage by dividing your net sales less your cost of goods sold by your net sales. Then divide your fixed costs by your gross profit percentage to arrive at break even.
Example. Say your fixed costs are $10,000 and your gross profit percentage is 25%. Your break even point is sales of $40,000 ($10,000 ÷ 25% = $40,000).

Too much math? Call us. We're happy to help you calculate your business's break even point and evaluate your profit structure.

Monday, October 26, 2015

Protect yourself from ID theft with credit report check

Protect yourself from ID theft with credit report check
Even if you're covered by a credit monitoring service, you may want to keep an eye on your credit report – and you can still do that for free at www.annualcreditreport.com. That's the only official website, so don't be fooled by other "free" claims.
At the site, you can get one free report annually from each of the three major agencies. Why bother? Identity theft is a multi-billion dollar industry, and checking your credit rating is one of the best ways to protect yourself. You might also be surprised at the number of mistakes on credit reports. Relatives or even non-relatives with the same (or similar) last name could have their credit information jumbled with yours. Individual companies could have incorrectly reported a negative credit occurrence (in the form of a delinquent payment or nonpayment) to the reporting agencies. Reviewing your credit report is a way to find and fix those issues.
If you find an error, both the credit reporting company and the company that provided the information about you are responsible for making corrections. You'll have to submit a written report and you'll get written results when corrections are made.
Give us a call if you're having problems with your credit reports. We're here to help.

Thursday, October 22, 2015

Decide when to start social security benefits

Decide when to start social security benefits
Whether you should take social security retirement benefits at the earliest possible date or defer benefits until reaching normal retirement age (or even age 70), depends on several factors. For example, you'll want to consider your overall health and life expectancy, your plans to earn income before reaching normal retirement age, anticipated returns on your other investments, and, surprisingly, your guess about the future of the social security program. As you can tell, the decision isn't one-size-fits-all.
For instance, say your savings won't cover ongoing expenses and you need to rely on social security income to make ends meet. In that case, deferring social security benefits may not be an option for you.
But if your financial circumstances offer more financial flexibility, deferring your benefits can be an advantage. For each year you delay (up to age 70), the payouts increase. In addition, if you plan to earn significant income between age 62 and your normal retirement age (65-67, depending on the year you were born), putting off your social security benefits may make sense. That's because any benefits in excess of specified limits ($15,720 in 2015) will be reduced. You'll lose $1 of benefits for every $2 in earnings above the limits. Note that you won't lose any social security benefits (regardless of earnings) once you reach full retirement age.
On the other hand, let's say you've accumulated a healthy balance in your 401(k) and expect that account to generate a good annual return. Under this scenario, you might be better off leaving your retirement savings alone and taking your social security benefits early to cover living expenses.
Or perhaps your family has a history of health problems and you don't realistically expect to live into your 80s. Again, taking social security benefits at age 62 might be a good choice.
For help with this important decision, please give us a call.

Tuesday, October 20, 2015

Items on your 2014 return can affect 2015 planning

Items on your 2014 return can affect 2015 planning


As year-end approaches, remember to check your 2014 federal income tax return for items that can affect your 2015 planning. Here are three to look for.
Capital loss carryover. If your capital losses exceeded your capital gains in 2014, you may be able to carry any unused loss to future years. You can apply the loss against 2015 capital gains as well as up to $3,000 of other income – a benefit to remember when you're rebalancing your portfolio over the next few months.
Tip: Keep track of your capital loss carryforward for alternative minimum tax planning and projections. In some cases, this amount can be different from the carryforward calculated for your regular income tax.
Charitable contribution carryover. Was your charitable donation deduction limited for 2014 or prior years? You may have a carryover that you can use if you're going to itemize on your 2015 tax return.
Tip: Take this carryover into consideration when planning your 2015 donations so you don't lose the benefit of older unused amounts. Charitable contribution carryforwards have a five-year life.
Net operating loss carryover. If your business had a loss in 2014, you had to make an election to carry the entire loss forward to 2015. Otherwise, the general rule of carrying the net operating loss back two years applies, with the remainder carried forward 20 years.

Give us a call to schedule a tax planning appointment. We're ready to help you get the most benefit from these and other carryovers, such as investment interest, tax credits, and passive activity losses.

Friday, October 16, 2015

Get ready for the "Cadillac" tax

Get ready for the "Cadillac" tax
 The 2010 Affordable Care Act added a 40% excise tax on high-cost employer-sponsored health insurance (sometimes called "Cadillac" plans). "High-cost" means plans with an annual cost of more than $10,200 for an individual and $27,500 for a family. Beginning in 2018, the tax applies to the amount above that limit. The tax is assessed annually, and is permanent, nondeductible, and applicable to many types of health coverage.
Because of its potentially broad impact, you'll want to start reviewing the health insurance coverage you offer to employees to learn how your business will be affected.
The IRS is just beginning to issue guidance. We'll keep you informed as information is released.

Wednesday, October 14, 2015

Estate executors have another responsibility

Estate executors have another responsibility


A law effective as of July 31, 2015, included provisions that require certain executors to file a statement with estate beneficiaries and the IRS, notifying both of the value of property as reported on the estate return. Unless an exception applies, the beneficiaries can claim no more than that value when the property is later sold or disposed of.
Under the new rule, the statement is due within 30 days after the estate return is filed or 30 days after the due date of the estate return, whichever is earlier. However, if you're required to file this new statement before February 29, 2016, the due date for filing and furnishing the statement is delayed until February 29, 2016.

We'll keep you updated as guidance becomes available.

Monday, October 12, 2015

Law revises due dates for 2016 returns

Law revises due dates for 2016 returns
The Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 changed due dates for some 2016 federal business returns (the ones you'll file in 2017).
Here's a sample of the changes:
Partnerships (Form 1065) – 2½ months after the close of the tax year. For calendar-year partnerships, that means a due date of March 15.
C corporations (Form 1120) – 3½ months after the close of the tax year. For calendar-year C corporations the due date will be April 15. Note there is a special rule for C corporations with a June 30 year-end. These corporations will not have to comply with the new due dates until after 2025.
S corporations (Form 1120S) – No change. The due date remains 2½ months after the close of the tax year (March 15 for calendar-year corporations).
Call us for more information.
 

Thursday, October 8, 2015

Avoid underpayment penalties

Avoid underpayment penalties


Check the total taxes you've already paid in for the year through withholding from your wages and/or quarterly estimated payments. Are you underpaid? Consider adjusting your withholding for the final months of 2015 or increasing your remaining quarterly estimate. If you employ household workers, include the payroll taxes you'll owe for them in your calculations. Call us for assistance.