11 Jun 2020
0

Rioting Damage at Your Business?

Roger Rossmeisl, CPA
Small Business Tax Briefs
Rioting Damage at your Business?

Rioting damage at your business?  The recent riots around the country have resulted in many storefronts, office buildings and business properties being destroyed. In the case of stores or other businesses with inventory, some of these businesses lost products after looters ransacked their property. Windows were smashed, property was vandalized, and some buildings were burned to the ground. This damage was especially devastating because businesses were reopening after the COVID-19 pandemic eased. A commercial insurance property policy should generally cover some, or all, of the losses. (You may also have a business interruption policy that covers losses for the time you need to close or limit hours due to rioting and vandalism.) But a business may also be able to claim casualty property loss or theft...

07 Jun 2020
0

New Employer Tax Credits Flowchart

Roger Rossmeisl, CPA
Small Business Tax Briefs
New Employer Tax Credits Flowchart

Many businesses that have been severaly impacted by the coronavirus (COVID-19) will qualify for two new employer tax credits - the Credit for Sick and Family Leave and the Employee Retention Credit. Sick and Family Leave Credit for Sick and Family Leave An employee who is unable to work (including telework) because of coronavirus quarantine or self-quarantine or has coronavirus symptoms and is seeking a medical diagnosis, is entitled to paid sick leave for up to ten days (up to 80 hours) at the employee’s regular rate of pay, or, if higher, the Federal minimum wage or any applicable State or local minimum wage, up to $511 per day, but no more than $5,110 in total. Caring for someone with Coronavirus An employee who is unable to work due to...

03 Jun 2020
0

Keep Life Insurance Out of Your Estate

Roger Rossmeisl, CPA
Individual Tax Briefs
Keep Life Insurance Out of Your Estate

If you have a life insurance policy, you probably want to make sure that the life insurance benefits your family will receive after your death won’t be included in your estate. That way, the benefits won’t be subject to the federal estate tax. Under the estate tax rules, life insurance will be included in your taxable estate if either: Your estate is the beneficiary of the insurance proceeds, or You possessed certain economic ownership rights (called “incidents of ownership”) in the policy at your death (or within three years of your death). The first situation is easy to avoid. You can just make sure your estate isn’t designated as beneficiary of the policy. The second situation is more complicated. It’s clear that if you’re the owner of the...

03 Jun 2020
0

Setting Up a SEP Plan for 2019

Roger Rossmeisl, CPA
Small Business Tax Briefs
Setting up a SEP Plan for 2019

Do you own a business but haven’t gotten around to setting up a tax-advantaged retirement plan? Fortunately, it’s not too late for setting up a SEP Plan for 2019 and reducing your 2019 tax bill. A Simplified Employee Pension (SEP) can still be set up for 2019, and you can make contributions to it that you can deduct on your 2019 income tax return. Even better, SEPs keep administrative costs low. Deadlines for contributions A SEP can be set up as late as the due date (including extensions) of your income tax return for the tax year for which the SEP first applies. That means you can establish a SEP for 2019 in 2020 as long as you do it before your 2019 return filing deadline. You...

03 Jun 2020
0

Business Opportunity or Scam?

Roger Rossmeisl, CPA
Fraud Briefs
Business Opportunity or Scam

The first question you should ask yourself about anything that's too good to be true is . . . is it a legitimate business opportunity or scam.  The investment “opportunity” could be anything from a new nutritional supplement to a foolproof method for "flipping" houses. But if the investment or product is advertised as “easy money” or promises immediate high earnings, beware. Although there are plenty of legitimate business opportunities out there, there are also plenty of fraudulent schemes that exist for no other reason than to steal your money. Simple or complicated These schemes can be relatively straightforward. For example, one New York state man was convicted of enticing investors to sink $10,000 each into a vending machine distribution business he promised would be profitable —...

03 Jun 2020
0

2019 Gift Tax Return Deadline is Coming Up

Roger Rossmeisl, CPA
Individual Tax Briefs
2019 Gift Tax Return Deadline is Coming Up

If you made large gifts to your children, grandchildren or other heirs last year, it’s important to determine whether you’re required to file a 2019 gift tax return. And in some cases, even if it’s not required to file one, it may be beneficial to do so anyway. Who must file? Generally, you must file a gift tax return for 2019 if, during the tax year, you made gifts: That exceeded the $15,000-per-recipient gift tax annual exclusion (other than to your U.S. citizen spouse), That you wish to split with your spouse to take advantage of your combined $30,000 annual exclusion, That exceeded the $155,000 annual exclusion for gifts to a non-citizen spouse, To a Section 529 college savings plan and wish to accelerate up to five...

03 Jun 2020
0

Determining a Reasonable Salary for a C Corporation Business Owner

Roger Rossmeisl, CPA
Small Business Tax Briefs
Determining a Reasonable Salary for a C Corporation Business Owner

If you’re the owner of an incorporated business, you probably know that there’s a tax advantage to taking money out of a C corporation as compensation rather than as dividends. The reason is simple. A corporation can deduct the salaries and bonuses that it pays executives, but not its dividend payments. Therefore, if funds are withdrawn as dividends, they’re taxed twice, once to the corporation and once to the recipient. Money paid out as compensation is taxed only once, to the employee who receives it. However, there’s a limit on how much money you can take out of the corporation this way. Under tax law, compensation can be deducted only to the extent that it’s reasonable. Any unreasonable portion isn’t deductible and, if paid to a...

31 May 2020
0

Avoiding Travel Voucher Scams

Roger Rossmeisl, CPA
Fraud Briefs
Avoiding Travel Voucher Scams

Most travelers love a deal that extends their budget — whether it’s a cheap flight, discounted hotel room or all-inclusive package tour. Unfortunately, sophisticated scammers are only too happy to profit from bargain hunters. When planning your next trip, be vigilant in avoiding travel voucher scams . . . particularly those selling at a deep discount. Fake that seems real In one common scheme, criminals purchase vouchers from travel companies using stolen credit card numbers, then sell the vouchers online or by phone to would-be travelers. Between the initial purchase and subsequent resale, the travel company is alerted to the fraud. And before the traveler can use the voucher, the company inactivates it, leaving the traveler with a worthless document. Voucher scammers often use email to hook people...

25 May 2020
0

Home Mortgage Interest Deduction Rules

Roger Rossmeisl, CPA
Individual Tax Briefs
Home Mortgage Interest Deduction Rules

If you own a home, the interest you pay on your home mortgage may provide a tax break. However, many people believe that any interest paid on their home mortgage loans and home equity loans is deductible. Unfortunately, that’s not true. First, keep in mind that you must itemize deductions in order to take advantage of the home mortgage interest deduction. Deduction and limits for “acquisition debt” A personal interest deduction generally isn’t allowed, but one kind of interest that is deductible is interest on mortgage “acquisition debt.” This means debt that’s: 1) secured by your principal home and/or a second home, and 2) incurred in acquiring, constructing or substantially improving the home. You can deduct interest on acquisition debt on up to two qualified residences:...

25 May 2020
0

WOTC Extended Through 2020

Roger Rossmeisl, CPA
Small Business Tax Briefs
WOTC Extended Through 2020

If you’re a business owner, be aware that a recent tax law extended a credit for hiring individuals from one or more targeted groups. Employers can qualify for a valuable tax credit known as the Work Opportunity Tax Credit (WOTC).  The WOTC was set to expire on December 31, 2019. But a new law passed late last year sees WOTC extended through 2020. Generally, an employer is eligible for the credit for qualified wages paid to qualified members of these targeted groups: members of families receiving assistance under the Temporary Assistance for Needy Families program, veterans, ex-felons, designated community residents, vocational rehabilitation referrals, summer youth employees, members of families in the Supplemental Nutritional Assistance Program, qualified Supplemental Security Income recipients, long-term family assistance recipients, and long-term unemployed...

ROGER ROSSMEISL, CPA

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

(714) 325-0442
roger@khopatel.com

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