If your partnership has been treating you and other partners as employees of a disregarded entity owned by the partnership so the partners can participate in employee benefit plans and receive other employee benefits, you’d better read this. Tax regulations (1) issued...
On the one hand, it's almost a prerequisite for entrepreneurs of all types to have that "can-do spirit." That sense that nobody else sees things quite like they do so, whatever it is they want to accomplish, it becomes something they know they'll have to do...
Carrying long-term debt is a challenge, but when the money is owed to the government and you see no way to pay what you owe, it can be psychologically and emotionally debilitating. Some people think they can turn to bankruptcy, but that is not the case – bankruptcy...
Congress created Achieving Better Life Experience (ABLE) accounts in 2014. Prior to the creation of the ABLE accounts, individuals with disabilities who were eligible for Medicaid or federal Supplemental Security Income were limited to a maximum of $2,000 in assets,...
Many people know IRS.gov has the latest filing info and tax forms, but they may not be aware that it also has a wide range of other tax-related topics. Here are five things people can find on IRS.gov besides filing info. 1. Find the Taxpayer Bill of Rights. Each...
Read the letter carefully. Most IRS letters and notices are about federal tax returns or tax accounts. Each notice deals with a specific issue and includes specific instructions on what to do. A notice may reference changes to a taxpayer's account, taxes owed, a...
The Internal Revenue Service today that interest rates will increase for the calendar quarter beginning Oct. 1, 2022. For individuals, the rate for overpayments and underpayments will be 6% per year, compounded daily, up from 5% for the quarter that began on July 1....
The word “audit” tends to strike fear in the hearts of American taxpayers, but the truth is that not every audit is a result of a problem, or that the Internal Revenue Service suspects you of wrongdoing. There are several reasons why the IRS might want to audit your...
Anyone pursuing higher education, including specialized job training and grad school, knows it can be pricey. Eligible taxpayers who paid higher education costs for themselves, their spouse or dependents in 2021 may be able to take advantage of two education tax...
There's an old saying in life that reminds us that "the only things that are certain are death and taxes." It seems that, occasionally, some celebrities seem to forget that second part. It's true. Just because you've got the number one movie at the box office, or just...
The Work Opportunity Tax Credit (WOTC) is a general business credit that is jointly administered by the Internal Revenue Service (IRS) and the Department of Labor (DOL). The WOTC is available for wages paid to certain individuals who begin work on or before December...
There is a little-known disaster provision of the tax code that, where if an employer has adopted a leave-based donation program, the employees can forgo paid vacation, sick, or personal leave in exchange for their employer making equivalent cash payments to qualified...
With gas prices soaring it has been expected the IRS would increase the mileage rate that business owners can deduct for vehicle use instead of keeping a record of actual expenses. Sure enough, the IRS recently announced a 4-cent increase in the optional mileage rate...
Here’s what taxpayers need to know about business-related travel deductions Business travel can be costly. Hotel bills, airfare or train tickets, cab fare, public transportation – it can all add up fast. The good news is business travelers may be able off-set some of...
One of the cardinal rules of accounting is this: Go through your new transactions every day. If you wait until there are too many of them, you’re likely to give them short shrift. You may miss problems, just as you might skip categorizing some of them because it...
Not too long ago in Orlando, Florida, a federal investigation uncovered a situation where 22 workers were denied overtime by a Florida-based equipment rental company. The company was paying flat salaries to certain employees, regardless of how many hours they worked...
Have you ever wondered how long the IRS has to question and assess additional tax on your tax returns? For most taxpayers who reported all their income, the IRS has three years from the date of filing the returns to examine them. This period is termed the statute of...
Estimated tax payments are not just for the self-employed. They are for anyone whose withholding and tax credits are significantly less than their projected tax liability, and if used properly, can protect a taxpayer from underpayment penalties. Employees who will...
Managing Your Finances During an Inflationary Period It’s hard to ignore the real-life impacts inflation is having. While gas and grocery prices are having the most immediate effect, the price of almost everything is going up. People who are looking for ways to...
A prior blog article posting included an article about the IRS’ plans to use ID.me facial recognition software for taxpayers and others to authenticate access to their online accounts. Under pressure from privacy activists and several members of Congress, the...
This could be another rough tax season for the IRS and taxpayers. Although this year’s filing season opens January 24, 2022 (i.e., it is the first day the IRS will accept and start processing 2021 returns), the Service still has a backlog of prior year returns to...
As the old saying goes, "If you fail to plan, you plan to fail." Whoever coined that phrase was talking about finances, whether they realized it or not. According to one recent study, a general lack of financial education costs Americans a collective $415 billion...
Early in 2021, Congress passed the American Rescue Plan which included a provision that increased the child tax credit amount and upped the age limit of eligible children. Normally, the credit was $2,000 per eligible child under age 17. For the 2021 tax year, the...
If you have purchased, owned, sold, gifted, made purchases with, or used cryptocurrency in business transactions, there are certain tax issues you need to know about. Unfortunately, there are some unanswered questions and little specific guidance offered by the IRS...
As it does every year, the Internal Revenue Service recently announced the inflation- adjusted 2022 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes. Beginning on...
If you use independent contractors to perform services for your business, for each one that you pay $600 or more for the year, you are required to issue the worker and the IRS a Form 1099-NEC no later than January 31, 2022, for 2021 payments. Generally, a 1099-NEC is...
It seems hard to believe, but the holiday season is almost upon us, and that means that the 2021 tax preparation season will soon follow. With the end of the tax year just around the corner, tax-savvy individuals need to take some time from their busy schedules to...
A common question among parents is, “How might I save for a child’s post-secondary education in a tax beneficial way?” The answer depends on how much the education is expected to cost and how much time is left until the child heads off to college or a university or...
Here’s What Happened in the World of Small Business in October 2021 Here are five things that happened this past month that affect your business. 1) Higher corporate rate appears to fall out of economic package Biden’s advisers said that they are pursuing a range of...
Steps all business owners should take when closing a business. • File a final tax return and related forms. The type of return to file and related forms depends on the type of business. • Take care of employees. Business owners with one or more employees must pay any...
We will be transitioning to a new portal called Client Center. Client Center is a secure web portal that will be used to easily exchange files and communications (tax questions, e-signatures, supporting documents and tax returns) between our Accounting/Tax team and...
Taxes are like vehicles in that they sometimes need a periodic check-up to make sure they are performing as expected, and if ignored, can cost you money. That is true of taxes as well, especially for 2021, as the pandemic benefits begin to wane and President Biden’s...
The normal April 15, 2021 filing deadline for 2020 individual tax returns was extended by the IRS to May 17, 2021 due to the continuing Covid-19 pandemic. If you could not complete your 2020 tax return by May 17 and are now on extension, that extension expires on...
Melissa Clary Key 2 Accounting Owner Years in industry: 23 College, University: Colorado State University Melissa Clary has been self employed since 2005 and is the former owner of Kruger and Clary, CPAs. She decided to branch out and form Key2...
If you are a small business owner, chances are good you’re paying more attention to your accounts receivables and deliverables than to a three-year-old Supreme Court decision. But knowing what happened in the Wayfair decision on June 21st of 2018 is important if you...
All too often, taxpayers wait until after the close of the tax year to worry about their taxes and miss opportunities that could reduce their tax liability or financially assist them. Mid-year is the perfect time for tax planning. The following are some events that...
The Internal Revenue Service (IRS) is reminding entities with Employer Identification Numbers (EINs) of their responsibility to update that information whenever the contact information or responsible party changes. IRS regulations require EIN holders to update...
It will be many years before we have a full understanding of what COVID-19 cost us as a society. But as that information is incrementally collected and released, we’re starting to see the picture take shape. One of the most recent reports on the subject was issued by...
We are making some changes with our tax software and will be using a different platform. This new platform will cause an update to our client portals. We will be sending out registration emails in the next couple of months. These new portals do not require Citrix...
The Internal Revenue Service has released a midyear report to Congress that details a significant backlog of tax returns dating back to the end of tax filing season, and many of those returns have yet to be processed. While backlogs are not unusual, this year’s is far...
With home mortgage rates at historic lows, it may be appropriate for you to consider refinancing your current mortgage. However, refinancing may not always be the greatest idea, even though mortgage rates are low, and even when your friends, relatives, and coworkers...
A taxpayer who is in the business of providing family day care in their home may deduct the ordinary and necessary expenses of their business. The two primary deductions include the business use of their home and the cost of providing meals and snacks to children in...
If you are considering starting a business, the simplest and least expensive form of business is a sole proprietorship. A sole proprietorship is a one-person business that reports its income directly on the individual’s personal tax return (Form 1040) using a Schedule...
If you’re thinking about moving from your current locale, you’re not alone. Americans are on the move for many different reasons: Remote work is increasingly popular and allows employees to live wherever they have access to WiFi, while tax changes introduced by the...
Now that most tax refunds are deposited directly into taxpayers’ bank accounts, the dream of opening your mailbox and finding an IRS refund check is all but a thing of the past. However, since the IRS now does most of its auditing through correspondence, an IRS letter...
President Biden presented his proposed American Families Plan (AFP) during his Joint Session of Congress address on April 29, 2021. What follows is an overview of what is included in the plan. But this is only his wish list; Congress will need to draft proposed...
The IRS has begun issuing notice CP508C to taxpayers with “seriously delinquent” tax debt and the service has resumed its program of notifying the State Department of taxpayers’ unpaid federal debts. The U.S. Department of State generally will not renew a passport or...
As U.S. businesses continue to recover from COVID-19’s economic devastation, the U.S. Small Business Administration (SBA) is expanding loan opportunities. The agency announced that beginning the week of April 6th, nonprofits and small businesses will be able to borrow...
The IRS announced on March 31, that it will take steps to automatically refund money this spring and summer to people who filed their tax returns reporting unemployment compensation before the recent law change made by the American Rescue Plan Act. The American Rescue...
May 2021 Individual Due Dates: May 10 - Report Tips to Employer If you are an employee who works for tips and received more than $20 in tips during April, you are required to report them to your employer on IRS Form 4070 no later than May 1110. Your employer is...
As U.S. businesses continue to recover from COVID-19’s economic devastation, the U.S. Small Business Administration (SBA) is expanding loan opportunities. The agency announced that beginning the week of April 6th, nonprofits, and small businesses will be able to...
The IRS did not extend the deadline for the first installment of the 2021 estimated tax payments, which continues to be April 15, 2021. Even though the filing due date for individual returns has been extended, in many cases the amount of estimated tax payments...
Just a reminder to those who have not yet filed their 2020 federal tax return that thanks to the IRS extending the filing due date, May 17, 2021 is the due date to either file your return and pay any taxes owed, or file for the automatic extension and pay the tax you...
The Consolidated Appropriations Act, 2021 (CCA), included a very tax-beneficial provision that liberalized the interaction between PPP loans and the Employee Retention Credit (ERC). Prior to its passage, if an employer obtained a Paycheck Protection Program (PPP)...
In order to help trades and businesses to retain employees and keep them employed during the COVID-19 crisis, the Coronavirus Aid, Relief, and Economic Security (CARES) Act created the Employee Retention Credit for 2020. As part of the Consolidated Appropriations Act,...
An increased child tax credit is part of President Biden’s stimulus package to help tackle the coronavirus pandemic and stimulate the economy. This stimulus package will provide lower-income parents with substantial financial assistance and support various other...
President Biden’s American Rescue Plan has extended the $300 benefit through September 9, 2021, and increased the number of weeks an individual can qualify for the benefits from 50 to 74. The American Rescue Plan Act originally slated the weekly amount to be $400....
The American Rescue Plan Act has passed and includes a third much-anticipated economic impact payment (EIP). This is one of several government measures intended to help financially stressed citizens. This will be the third round of EIPs since the pandemic began...
The Pandemic Unemployment Assistance and Pandemic Emergency Unemployment Compensation were extended for 11 weeks. Congress will add $300 to all weekly unemployment benefits. Workers who rely on multiple jobs and have lost income will also be eligible for a weekly...
A second round of stimulus will include direct payments of up to $600 per adult and per child. Call Key2 Accounting today with any questions you may have. For more details visit: https://www.irs.gov/coronavirus/economic-impact-payments
Paycheck Protection Program (PPP): The relief package creates a second loan from the Paycheck Protection Program, called a “PPP second draw” and allocates $325 billion in aid to small businesses, with a total $284.5 billion of that going to reauthorize the Paycheck...
December 2020 Business Due Dates: December 1 - Employers During December, ask employees whose withholding allowances will be different in 2021 to fill out a new Form W4 or Form W4(SP). December 15 - Social Security, Medicare and Withheld Income Tax If the monthly...
To say COVID-19 has made 2020 a disastrous year for just about everyone would be an understatement. In response to the economic slowdown and losses of income, Congress passed several extensive laws to benefit individuals and businesses that suffered financial hardship...
For taxpayers who believe they are owed a refund from the Internal Revenue Service, you have three years from the original due date of the return in order to file and claim your refund. However, if you wait too long you will forfeit any refund you might be entitled....
If you are the owner of a small business that obtained a Paycheck Protection Program (PPP) loan, you are most likely aware that the loan can be partially or totally forgiven if you used the loan proceeds for the required purposes. Loan forgiveness is not automatic and...
While much attention has been focused on the Paycheck Protection Program, there are two additional programs designed to help COVID-19 affected businesses retain employees: Employee Retention Tax Credit (ERTC) and Employer Social Security Tax Deferral. The Employee...
Small Business Administration Issues New PPP Loan Guidance: What You Need To Know And FAQs On June 22, the Small Business Administration (SBA) issued new Interim Final Rules (IFR) on the recently passed Paycheck Protection Program Flexibility Act (PPPFA), clarifying...
Anyone who already took a required minimum distribution (RMD) in 2020 from certain retirement accounts now has the opportunity to roll those funds back into a retirement account following the CARES Act RMD waiver for 2020. The 60-day rollover period for any RMDs...
The CARES Act provides that qualified individuals may treat as corona virus-related distributions up to $100,000 in distributions made from their eligible retirement plans (including IRAs) between Jan. 1 and Dec. 30, 2020. A corona virus-related distribution is not...
Commonly referred to as “stimulus checks” or “recovery rebates”, Economic Impact Payments to individuals are a key provision of the Corona virus Aid Relief, and Economic Security (CARES) Act legislation that Congress passed to help reduce the financial burden of...
Coronavirus-related paid leave for workers and payroll tax credits for small and midsize businesses Under the Families First Act, small and midsize employers will be able to take advantage of refundable payroll tax credits. This credit will enable employers to fully...
Dear Valued Clients Potential Clients and Small Business Partners: Key2 Accounting wants to let you know that we are here to stand by you, our small business clients and partners as we navigate the unchartered waters of the Coronavirus. We have provided some updated...
IRS delays tax filing and payment deadlines to July 15 for all taxpayers ________________________________________ The Treasury Department and the IRS are providing special tax filing and payment relief to individuals and businesses in response to the COVID-19...
CORE 24 is an engaging e-learning program for anyone who wishes to advance their business knowledge. It's “Entrepreneurship in a box”. 24 essential interactive business concepts (called “cores”) for business success. Nuggets of wisdom from experienced professionals...
When you hire an employee who starts in 2020, you must give them the newly designed Form W-4, which is less complex, more transparent, and makes it easier for your employees’ withholding to match their tax liability. The new form has been renamed Employee’s...
The Internal Revenue Service issued final regulations that require taxpayers to reduce their charitable contribution deductions by the amount of any state or local tax credits they receive or expect to receive in return. The IRS also stated that taxpayers may treat...
This is a good time of year to review your payroll withholding to make sure you are on track with regards to your 2019 income taxes and having the correct amount withheld or paid in with estimated payments. A Paycheck Checkup using the IRS Withholding Calculator can...
While some tax obligations come with safety valves, such as the option of filing for an extension on income tax returns, there is no leeway with payroll taxes. If you file your reports or make withholding deposits late, the meter on interest and penalties starts...
Recently the Supreme Court has voted in favor of the State of South Dakota in the Wayfair Case which might affect your business, with Supreme Court Decision and that Decision Explained. Basically the ruling states that Colorado businesses selling products to other...
Home Tax Deductions "Mortgage Interest" - New tax law imposes a lower dollar limit on mortgage qualifying for home mortgage interest deduction. Starting this year taxpayers may only deduct interest on $750,000 of qualified residence loans. This is down from the...
K-12 education - 2018 changes allows distributions from 529 education savings account plans to be used to pay up to a total of $10,000 of tuition per beneficiary each year at an elementary or secondary (k-12) public, private or religious school of your choice. Tuition...
The passage of the Tax Cuts and Jobs Act, which will affect 2018 tax returns. Checking withholding amounts is important. These tax law changes include: • Increased standard deduction • Eliminated personal exemptions • Increased Child Tax Credit • Limited or...
Many owners of sole proprietorships, partnership, trusts and S corporations could get to deduct up to 20 percent of their qualified business income. The new tax deduction for owners is referred to as Section 199A deduction which was created by the Tax Cuts and Jobs...
Income Tax Rate Changes In 2014, taxable incomes above the following thresholds now fall into the 39.6% bracket: Married Filing Separately ($228,800), Unmarried Individuals ($406,750), Head of Household ($432,200), and Married Filing Joint Returns ($457,600)....
Several new forms will be issued to taxpayers this year from the Affordable Care Act, primarily Form 1095-A, B and C. In order to complete your 2014 return we must have all copies of Form 1095. These forms provide us with the necessary information to report your...
Did you get a tax refund this year? I'm sure you've already heard that you should not be giving the government an interest-free loan. Maybe you've decided to change things for 2012 by revising your withholding or estimated tax payments to reduce the amount of next...
As year-end approaches, take a closer look at your investment portfolio. There may be some tax-saving strategies worth considering. For example * Wash sales. Thinking of selling a security before December 31 to take advantage of a capital loss? To make sure the loss...
On August 2, President Obama signed the Budget Control Act of 2011. The act plans to: Eliminate waste, fraud and abuse with health insurance and social security Provide an emergency spending reform Provide a balanced budget amendment for Congress to vote on Cut $1...
There's a new tax break this year, and you'll want to update your budget to accommodate it. The compromise tax legislation passed in December included a payroll tax cut for 2011. * How it works when you're an employee: Your employer will deduct less social security...
Our firm has been preaching doom and gloom all year regarding higher tax brackets, alternative minimum tax affecting 20 million people, and tax credits being cut back. We can breathe a sigh of relief as President Obama decided to grant us an early Christmas gift...
The best time for tax planning is now, right before the end of the year. The reason why is there is still time to make changes that will impact how much taxes you pay. Several things with regards to the tax laws have changed this year, so it's...
In a down economy making good decisions is critical. These informed decisions should come from accurate financial numbers. Numbers determine which levers to pull to increase your profits. Businesses need to review and analyze their numbers periodically. Many business...
When it comes to income taxes it is crucial to find someone who you can trust and will do a good job. How should you start by going about finding a tax professional? It’s easier to ask for referrals first before leafing through the yellow pages. I would suggest by...
Who needs a buy-sell agreement? A buy-sell agreement is needed for every co-owned business. Every day that value is added to the business increases the financial risk when this agreement isn’t in place. Business owners often ask CPAs about how useful buy-sell...
Business Entity Selection When starting a business you must decide what type of business entity you are going to establish. It is important to consider the legal and tax implications for the different types of entities before you make this decision. Listed below...