17 Nov 2021
0

Factors To Consider When Choosing a Business Entity

Roger Rossmeisl, CPA
Automotive, Small Business Tax Briefs
Factors to Consider When Choosing a Business Entity

Are you planning to launch a business or thinking about changing your business entity? If so, you need to determine which entity will work best for you — a C corporation or a pass-through entity such as a sole-proprietorship, partnership, limited liability company (LLC) or S corporation. There are many factors to consider and proposed federal tax law changes being considered by Congress may affect your decision. The corporate federal income tax is currently imposed at a flat 21% rate, while the current individual federal income tax rates begin at 10% and go up to 37%. The difference in rates can be mitigated by the qualified business income (QBI) deduction that’s available to eligible pass-through entity owners that are individuals, estates and trusts. Note that non-corporate taxpayers...

16 Nov 2021
0

Factor in Taxes if You’re Relocating to Another State in Retirement

Roger Rossmeisl, CPA
Individual Tax Briefs
Factor in Taxes if Youre Relocating to Another State in Retirement

Are you considering a relocating to another state when you retire? Perhaps you want to relocate to an area where your loved ones live or where the weather is more pleasant. But while you’re thinking about how many square feet you’ll need in a retirement home, don’t forget to factor in state and local taxes. Establishing residency for state tax purposes may be more complicated than it initially appears to be. What are all applicable taxes? It may seem like a good option to simply move to a state with no personal income tax. But, to make a good decision, you must consider all taxes that can potentially apply to a state resident. In addition to income taxes, these may include property taxes, sales taxes and estate taxes. If...

16 Nov 2021
0

Typosquatters are Leading Innocent Victims Astray

Roger Rossmeisl, CPA
Fraud Briefs
Typosquatters are Leading Innocent Victims Astray

Typosquatting takes advantage of an inclination among internet users known as “fat fingers” — a tendency to hit the wrong keys and enter misspelled trademarks or brands. Like phishing, typosquatting is a type of social engineering that tricks people into visiting websites they didn’t intend to visit. These schemes can harm both consumers and the businesses whose names are abused. Connection to cybersquatting Typosquatting is connected to cybersquatting, where someone registers a site’s domain name that includes a trademark and then tries to profit by selling that name to the trademark owner. With typosquatting, fraudsters register URLs that are common misspellings of company and brand names. For example, a bad actor might register landswnd.com and lnadsend.com. Then, when users try to visit the site of retailer Lands’...

12 Nov 2021
0

Maximize Your Depreciation with a Cost Segregation Study

Roger Rossmeisl, CPA
Small Business Tax Briefs
Maximize Your Depreciation with a Cost Segregation Study

If your business is depreciating over a 30-year period the entire cost of constructing the building that houses your operation, you should consider a cost segregation study. It might allow you to accelerate depreciation deductions on certain items, thereby reducing taxes and boosting cash flow. And under current law, the potential benefits of a cost segregation study are now even greater than they were a few years ago due to enhancements to certain depreciation-related tax breaks. Fundamentals of depreciation Generally, business buildings have a 39-year depreciation period (27.5 years for residential rental properties). Usually, you depreciate a building’s structural components, including walls, windows, HVAC systems, elevators, plumbing and wiring, along with the building. Personal property — such as equipment, machinery, furniture and fixtures — is eligible for...

12 Nov 2021
0

Is Someone Stealing Your Company’s Secrets?

Roger Rossmeisl, CPA
Fraud Briefs
Is Someone Stealing Your Companys Secrets?

Corporate espionage has long been a threat for U.S. companies. Recently, intellectual property theft by foreign governments and organized crime gangs has grabbed headlines — for good reason. According to the U.S. Justice Department, 80% of its economic espionage prosecutions target schemes that would benefit China. Yet for most businesses, the threat comes from employees and former employees who take advantage of lax environments with few internal controls. The problem . . . and a solution Employees with access to trade secrets may take that information with them when they leave your company for another job — or pad their paychecks by selling it to your competitors while still employed. As with all types of fraud, workers are more likely to participate in corporate espionage if they’re...

05 Nov 2021
0

What to Know About Participating in a 401(k) Plan

Roger Rossmeisl, CPA
Individual Tax Briefs
What to Know About Participating in a 401(k) Plan

Employers offer 401(k) plans for many reasons, including to attract and retain talent. These plans help an employee accumulate a retirement nest egg on a tax-advantaged basis. If you’re thinking about participating in a plan at work, here are some of the features. Under a 401(k) plan, you have the option of setting aside a certain amount of your wages in a qualified retirement plan. By electing to set cash aside in a 401(k) plan, you’ll reduce your gross income, and defer tax on the amount until the cash (adjusted by earnings) is distributed to you. It will either be distributed from the plan or from an IRA or other plan that you roll your proceeds into after leaving your job. Tax advantages Your wages or other compensation...

05 Nov 2021
0

Social Security Wage Base is Increasing in 2022

Roger Rossmeisl, CPA
Small Business Tax Briefs
Social Security Wage Base Is Increasing in 2022

The Social Security Administration recently announced that the wage base for computing Social Security tax will increase to $147,000 for 2022 (up from $142,800 for 2021). Wages and self-employment income above this threshold aren’t subject to Social Security tax. Background information The Federal Insurance Contributions Act (FICA) imposes two taxes on employers, employees and self-employed workers — one for Old Age, Survivors and Disability Insurance, which is commonly known as the Social Security tax, and the other for Hospital Insurance, which is commonly known as the Medicare tax. There’s a maximum amount of compensation subject to the Social Security tax, but no maximum for Medicare tax. For 2022, the FICA tax rate for employers is 7.65% — 6.2% for Social Security and 1.45% for Medicare (the same as...

05 Nov 2021
0

How Business Owners Can Comply With New Financial Crime Regulation

Roger Rossmeisl, CPA
Fraud Briefs
How Business Owners Can Comply With New Financial Crime Regulation

Earlier this year, the Corporate Transparency Act (CTA) became the latest law intended to foil financial crime. This law is part of the National Defense Authorization Act and requires certain entities to disclose the identities of those who own or control it. Anonymous no longer Perpetrators of criminal acts such as fraud, drug and human trafficking, and terrorism often use anonymous or shell companies to launder ill-gotten funds and avoid prosecution. By removing anonymity from business ownership, the CTA makes it harder for criminals to engage in criminal activity. Forcing disclosure of an entity’s beneficial owners enables law enforcement to penetrate corporate walls. In fact, New York Federal Reserve research suggests that the CTA will reduce criminal transactions by approximately 70%. Covered entities  Unlike other laws designed to combat financial...

ROGER ROSSMEISL, CPA

Kho & Patel CPAs
160 E. Arrow Highway
San Dimas, CA 91773

(714) 325-0442
roger@khopatel.com

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