16 Jul 2020
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3 Issues to Consider After Filing Your 1040 on July 15th

Roger Rossmeisl, CPA
Individual Tax Briefs
3 Issues to Consider After Filing Your 1040 on July 15th

The tax filing deadline for 2019 tax returns was extended until July 15 this year, due to the COVID-19 pandemic. Now that your 2019 tax return has been successfully filed with the IRS, there may still be some issues to bear in mind. Here are 3 issues to consider after filing your 1040 on July 15th. 1. Some tax records can now be thrown away You should keep tax records related to your return for as long as the IRS can audit your return or assess additional taxes. In general, the statute of limitations is three years after you file your return. So you can generally get rid of most records related to tax returns for 2016 and earlier years. (If you filed an extension for...

06 Jul 2020
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IRA for a Nonworking Spouse

Roger Rossmeisl, CPA
Individual Tax Briefs
IRA for a Nonworking Spouse

It’s often difficult for married couples to save as much as they need for retirement when one spouse doesn’t work outside the home — perhaps so that spouse can take care of children or elderly parents. In general, an IRA contribution is allowed only if a taxpayer has compensation. However, an exception involves a “spousal” IRA. It's essentially an IRA for a nonworking spouse and allows a contribution to be made for that nonworking spouse. Under the spousal IRA rules, the amount that a married couple can contribute to an IRA for a nonworking spouse in 2020 is $6,000, which is the same limit that applies for the working spouse. Two main benefits As you may be aware, IRAs offer two types of benefits for taxpayers who make...

06 Jul 2020
0

Foiling Parcel Delivery Thieves

Roger Rossmeisl, CPA
Fraud Briefs
Foiling Parcel Delivery Thieves

Even before the novel coronavirus (COVID-19) pandemic struck, Americans received a lot of packages. About 18 billion parcels were shipped in the United States in 2018, according to Pitney Bowes, and the parcel delivery industry has been growing at an average 4.7% each year. But given the recent “shelter in place” orders, 2020 may break records for services such as UPS, FedEx and the U.S. Postal Service. Not surprisingly, thieves and fraud perpetrators are looking for any opportunity to profit from what has become an essential service. Here’s what you should watch out for to assist you in foiling parcel delivery thieves. Porch piracy You may already be aware of physical package thefts by “porch pirates” — a crime that usually flares up around the holidays. A...

06 Jul 2020
0

Business Meal Deductions: The Current Rules Amid Proposed Changes

Roger Rossmeisl, CPA
Small Business Tax Briefs
Business Meal Deductions

Restaurants and entertainment venues have been hard hit by the novel coronavirus (COVID-19) pandemic. One of the tax breaks that President Trump has proposed to help them is an increase in the amount that can be deducted for business meals and entertainment. It’s unclear whether Congress would go along with enhanced business meal and entertainment deductions. But in the meantime, let’s review the current rules. Before the pandemic hit, many businesses spent money “wining and dining” current or potential customers, vendors and employees. The rules for deducting these expenses changed under the Tax Cuts and Jobs Act (TCJA), but you can still claim some valuable write-offs. And keep in mind that deductions are available for business meal takeout and delivery. One of the biggest changes is that you...

06 Jul 2020
0

Deductibility of Student Loan Interest

Roger Rossmeisl, CPA
Individual Tax Briefs
Deductibility of Student Loan Interest

The economic impact of the novel coronavirus (COVID-19) is unprecedented and many taxpayers with student loans have been hard hit.  The Coronavirus Aid, Relief and Economic Security (CARES) Act contains some assistance to borrowers with federal student loans. Notably, federal loans were automatically placed in an administrative forbearance, which allows borrowers to temporarily stop making monthly payments. This payment suspension is scheduled to last until September 30, 2020. But what about the deductibility of student loan interest? Deductibility of student loan interest Despite the suspension, borrowers can still make payments if they choose. And borrowers in good standing made payments earlier in the year and will likely make them later in 2020. So can you deduct the student loan interest on your tax return? The answer is yes, depending...

06 Jul 2020
0

Ways to Chip Away at Your 2019 Business Tax Bill

Roger Rossmeisl, CPA
Small Business Tax Briefs
Ways to Chip Away at Your 2019 Business Tax Bill

The extended federal income tax deadline is coming up fast. As you know, the IRS postponed until July 15 the payment and filing deadlines that otherwise would have fallen on or after April 1, 2020, and before July 15.  Here's some ways to chip away at your 2019 business tax bill. Retroactive COVID-19 business relief The Coronavirus Aid, Relief and Economic Security (CARES) Act, which passed earlier in 2020, includes some retroactive tax relief for business taxpayers. The following four provisions may affect a still-unfiled tax return — or you may be able to take advantage of them on an amended return if you already filed. Liberalized net operating losses (NOLs). The CARES Act allows a five-year carryback for a business NOL that arises in a tax year...

27 Jun 2020
0

Efforts to Corral Coronavirus Fraud

Roger Rossmeisl, CPA
Fraud Briefs
Efforts to Corral Coronavirus Fraud

The COVID-19 pandemic has opened the floodgates to scam artists attempting to profit from sick, anxious and financially vulnerable Americans. Frontline efforts to corral Coronavirus fraud are being headed up by the Federal Trade Commission (FTC), U.S. Justice Department (DOJ) and other government agencies. Here are some of the fraud schemes they’re actively investigating —  and the perpetrators they’ve rounded up. Peddling false hope The FTC has sent warning letters to almost 100 businesses for making scientifically unsubstantiated claims about their products. Companies from California to Virginia, Indiana to Florida have touted (mostly online or by phone) “treatments” for COVID-19, even though the federal government hasn’t approved any vaccines or cures for the disease. Letter recipients must stop making deceptive claims immediately and notify the FTC within 48...

27 Jun 2020
0

Business Charitable Contribution Rule Changes Under the CARES Act

Roger Rossmeisl, CPA
Small Business Tax Briefs
Business Charitable Contribution Rul Changes under the CARES Act

In light of the novel coronavirus (COVID-19) pandemic, many businesses are interested in donating to charity. In order to incentivize charitable giving, the Coronavirus Aid, Relief and Economic Security (CARES) Act made some liberalizations to the rules governing charitable deductions. Here are two  changes that affect businesses: The limit on charitable deductions for corporations has increased Before the CARES Act, the total charitable deduction that a corporation could generally claim for the year couldn’t exceed 10% of corporate taxable income (as determined with several modifications for these purposes). Contributions in excess of the 10% limit are carried forward and may be used during the next five years (subject to the 10%-of-taxable-income limitation each year). What changed? Under the CARES Act, the limitation on charitable deductions for corporations...

27 Jun 2020
0

There’s Still Time to Make a 2019 IRA Contribution

Roger Rossmeisl, CPA
Individual Tax Briefs
Theres Still Time to Make a 2019 IRA Contribution

Do you want to save more for retirement on a tax-favored basis? If so, and if you qualify, you can make a  2019 IRA contribution for the 2019 tax year between now and the extended tax filing deadline and claim the write-off on your 2019 return. Or you can contribute to a Roth IRA and avoid paying taxes on future withdrawals. You can potentially make a contribution of up to $6,000 (or $7,000 if you were age 50 or older as of December 31, 2019). If you’re married, your spouse can potentially do the same, thereby doubling your tax benefits. The deadline for 2019 traditional and Roth contributions for most taxpayers would have been April 15, 2020. However, because of the novel coronavirus (COVID-19) pandemic, the IRS...

ROGER ROSSMEISL, CPA

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

(714) 325-0442
roger@khopatel.com

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