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2018 – 10/01 – Could a cost segregation study help you accelerate depreciation deductions?

Businesses that acquire, construct or substantially improve a building should consider a cost segregation study. It combines accounting and engineering techniques to identify building costs that are properly allocable to tangible personal property rather than real property. This may allow you to accelerate depreciation deductions, thus reducing taxes and boosting cash flow. And the potential benefits are now even greater due to enhancements to certain depreciation-related breaks under the TCJA. Contact us for help assessing the potential tax savings.

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2018 – 09/21 – Cash vs. accrual reporting: Which is right for your business?

The main difference between the cash and accrual methods of accounting is timing: Income is generally reported earlier under the accrual method. Two provisions of the Tax Cuts and Jobs Act could affect your choice of accounting method. First, starting in 2018, the gross-receipts threshold for using the cash method has been increased to $25 million. Second, you must now report revenue for tax purposes no later than for financial reporting purposes. These changes could prompt more companies to use the cash method. Contact us to discuss the pros and cons.

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2018 – 09/28 – Auditing royalty agreements

Does your company license intellectual property to others? If so, an external audit can help ensure you’re receiving the correct amount of royalty payments. After reviewing the scope of your agreement, the auditor reviews how the licensee determines royalties and compares the payments you’ve received to the licensor’s sales, inventory and production records. Periodic audits can prevent small, but honest, mistakes from spiraling out of control and reduce the temptation for dishonest licensees to commit fraud. Contact us to schedule your next royalty audit.

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2018 – 09/25 – Tax planning for investments gets more complicated

For investors, fall is a good time to review year-to-date gains and losses. Doing so can help you determine whether to buy or sell investments before year end to save taxes. You also need to consider the TCJA. While it didn’t change long-term capital gains rates, it did change the tax brackets. For 2018 through 2025, these brackets are no longer linked to the ordinary-income tax brackets for individuals. So, for example, you could be subject to the top long-term capital gains rate even if you aren’t subject to the top ordinary-income rate. Questions? Contact us.

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2018 – 09/17

Does your business reimburse employees’ work-related travel expenses? If you do, you know that it can help attract and retain employees. If you don’t, you may want to start. Changes under the TCJA make such reimbursements even more attractive to employees: Employees are no longer allowed to deduct such expenses. Travel reimbursements also come with tax benefits, but only if you follow a method that passes muster with the IRS. To learn more, contact us. We can help you determine whether you should reimburse such expenses and which method is right for you.

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2018 – 09/25 – Tax planning for investments gets more complicated

For investors, fall is a good time to review year-to-date gains and losses. Doing so can help you determine whether to buy or sell investments before year end to save taxes. You also need to consider the TCJA. While it didn’t change long-term capital gains rates, it did change the tax brackets. For 2018 through 2025, these brackets are no longer linked to the ordinary-income tax brackets for individuals. So, for example, you could be subject to the top long-term capital gains rate even if you aren’t subject to the top ordinary-income rate. Questions? Contact us.

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2018 – 09/24 – Businesses aren’t immune to tax identity theft

Tax identity theft may seem like a problem only for individuals. But increasingly businesses are becoming victims. Business tax identity theft occurs when a criminal uses information from a business (such as the Employer Identification Number) to obtain tax benefits or enable individual tax identity theft schemes. Here are some prevention tips: 1) Educate employees on how to spot tax fraud schemes. 2) Use secure methods to send W-2 forms to employees. 3) Implement risk management strategies designed to flag suspicious communications. Contact us to learn more.

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2018 – 09/17

Does your business reimburse employees’ work-related travel expenses? If you do, you know that it can help attract and retain employees. If you don’t, you may want to start. Changes under the TCJA make such reimbursements even more attractive to employees: Employees are no longer allowed to deduct such expenses. Travel reimbursements also come with tax benefits, but only if you follow a method that passes muster with the IRS. To learn more, contact us. We can help you determine whether you should reimburse such expenses and which method is right for you.

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2018 – 09/04 – How to reduce the tax risk of using independent contractors

Classifying a worker as an independent contractor frees a business from payroll tax liability and responsibility for withholding income taxes and the worker’s share of payroll taxes. But if the IRS reclassifies a worker as an employee, your business could be hit with back taxes, interest and penalties. When assessing worker status, the IRS typically looks at the level of behavioral and financial control the business has over the worker and the relationship of the parties. Fortunately, there are strategies for minimizing your exposure. Contact us to learn more.

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2018 – 09/11 – You might save tax if your vacation home qualifies as a rental property

If you own a vacation home and both rent it out and use it personally, classification as a rental property might save tax. Expenses attributable to a rental property aren’t subject to the TCJA’s tightened limits on itemized deductions for property tax and mortgage interest, and losses may be deductible. A rental property generally is one you use for 14 days or less, or under 10% of the days you rent it out, whichever is greater. Adjusting use between now and year end can ensure it’s classified as a rental property. Contact us for details.

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