If you own a small company, you may be considering structuring your business as a limited liability corporation or LLC. LLCs are seen as a favorable entity type by many business owners. The “limited liability” portion of the name means that the personal assets of the members of the LLC[…]
Read More »The IRS has announced that it will waive penalty fees for taxpayers who owe less than $100,000 in back taxes for the years 2020 and 2021. This relief will benefit around 4.6m individuals, businesses, and tax-exempt organizations, totaling about $1bn. The decision to forgive the failure-to-pay penalties is attributed to[…]
Read More »The IRS increased the optional standard mileage rate used to calculate the deductible costs of operating a vehicle for business to 67 cents per mile driven, up 1.5 cents from 2023. The increased rate is effective as of Jan. 1, 2024 (Notice 2024-08). The notice, released Thursday, sets the 2024[…]
Read More »Maxing out your retirement account(s) is the first step to limiting your tax liability. Contributions made to 401(k) accounts come out of an employee’s paycheck before taxes are taken out, lowering their taxable income. Similarly traditional IRA contributions are tax deductible and lower a person’s tax liability. In 2022, the[…]
Read More »The IRS again delayed the effective date of the $600 threshold for Form 1099-K reporting for third-party settlement organizations and will treat 2023 as another transition year, the Service said Tuesday in Notice 2023-74. When the IRS does start to implement the new threshold, enacted by the American Rescue Plan[…]
Read More »‘Tis the season for giving, and one way to give and reduce your 2023 income tax liability is by making charitable contributions. Generally, you can claim an income tax deduction of up to 60 percent of your adjusted gross income for cash contributions to a public charity. You might also[…]
Read More »Beginning January 1, 2024, corporations, limited liability companies, and other entities that file with the Secretary of State must report information about their beneficial owners to the Financial Crimes Enforcement Network (FinCEN). The FinCEN is a bureau of the Department of the Treasury, separate from the IRS, that collects and[…]
Read More »Individual taxable earnings of up to $168,600 annually will be subject to Social Security tax in 2024, the Social Security Administration (SSA) announced Thursday. The amount, an increase from $160,200 in 2023, is the wage base limit that applies to earnings subject to the 6.2% OASDI tax (old age, survivors,[…]
Read More »There are special considerations if you’re a business owner who also works in the business, depending on its structure: Partnerships and limited liability companies. Generally, all trade or business income that flows through to you for income tax purposes is subject to self-employment taxes — even if the income isn’t[…]
Read More »You can be subject to penalties if you don’t pay enough tax during the year through estimated tax payments and withholding. Here are some strategies to help avoid underpayment penalties: Know the minimum payment rules. For you to avoid penalties, your estimated payments and withholding must equal at least 90%[…]
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