News

Here’s a recent update on the Employee Retention Credit (ERC) and the new IRS payback scheme. New IRS ERC Payback Program The IRS introduced a second ERC Voluntary Disclosure Program for 2021 claims. Under this program, you can say, “I didn’t deserve the ERC, so I’ll repay 85 percent...

Does your business classify workers as independent contractors instead of employees? You should know that the U.S. Department of Labor is trying to make it harder for all businesses to use independent contractors. The Department of Labor enforces the Fair Labor Standards Act (FLSA), the federal law that requires...

I’d like to bring your attention to a recent U.S. Supreme Court decision that could significantly impact your buy-sell agreement if it involves life insurance to redeem shares upon your death. Impact on Estate Tax The Supreme Court’s ruling in Connelly established that life insurance proceeds used by a company to...

Here are some important tax strategies for your aircraft operations that could help you overcome passive loss limitations and maximize your deductions. Understanding Passive Activity Limitations The IRS’s passive activity loss rules can prevent you from using aircraft-related losses to offset other income. If the tax code classifies your...

Based on IRS regulations, club dues are generally not deductible if the organization’s principal purpose is to conduct entertainment activities for its members.  However, there are exceptions for civic and public service organizations, such as the Lions, Rotary, Kiwanis, and Civitan clubs, which the IRS recognizes as not being...

The story of James Maggard, a minority shareholder in an S corporation, highlights some significant lessons about the importance of vigilance and the need for proper oversight in businesses with multiple owners. Maggard, who owned 40 percent of the corporation, discovered too late that his fellow shareholders looted the...

After our discussion about ways to save on your Social Security taxes, you might be wondering how these savings impact your Social Security benefits. After all, paying less into Social Security results in receiving lower benefits later in life.  However, there is a strategy to come out ahead—by creating...

You can plan your tax-deductible business life to avoid cold winters and hot summers. Spend a moment examining the following four short paragraphs containing the Andrews case’s basic facts.  For six months of the year, from May through October, Edward Andrews lived in Lynnfield, Massachusetts, where he owned and operated Andrews...

As you consider converting your C corporation into an S corporation, understand and plan for the built-in gains (BIG) tax.  The tax code imposes the BIG tax on S corporations that recognize gains on assets that the C corporation held at the time of S corporation conversion. Some gains...

If you run your business through a regular “C” corporation, beware of the accumulated earnings tax (AET).  The IRS can use the AET to penalize C corporations that retain earnings in the business rather than pay them to shareholders as taxable dividends. To retain earnings, the C corporation first...

Consider this happy scenario: You purchased one Bitcoin for $15,000 14 months ago and another six months later for $40,000. Today, you sell one Bitcoin for $60,000. You’re a genius! But is your taxable gain $45,000 or $20,000?  It all depends on your crypto accounting method. Many crypto owners...

You may own an S corporation with a rental property as its sole asset. A common concern with this approach is what happens when the owner passes away, specifically regarding the step-up in basis. I’m pleased to inform you that while technically the rental property itself doesn’t receive a...