• Independent contractor vs. employee status: The DOL issues new final rule

      The U.S. Department of Labor’s (DOL’s) test for determining whether a worker should be classified as an independent contractor or an employee for purposes of the federal Fair Labor Standards Act (FLSA) has been revised several times over the past decade. Now, the DOL is implementing a new final rule rescinding the employer-friendly test that was developed under the Trump administration. The new, more [...]

    Published On: February 27, 2024Categories: ETRA
  • Health insurance premium tax credit FAQs!

    Just in time for tax filing season, the IRS has made several updates to (and added several new) FAQs related to the health insurance premium tax credit. This refundable credit is designed to help eligible individuals and families with low or moderate income afford health insurance purchased through the Health Insurance Marketplace. The size of the premium tax credit is based on a sliding scale. [...]

    Published On: February 26, 2024Categories: Federal Tax Posts
  • Auditing revenue recognition

      The top line of an income statement for a for-profit business is revenue (or sales). Reporting this line item correctly is critical to producing accurate financial statements. Under U.S. Generally Accepted Accounting Principles (GAAP), revenue is recognized when it’s earned. With accrual-basis accounting, that typically happens when goods or services are delivered to the customer, not necessarily when cash is collected from the customer. [...]

    Published On: February 26, 2024Categories: Business, Featured
  • Phase 2 has started. #Compliance

    The IRS is beginning phase two of its Pre-Examination Retirement Plan Compliance Program. The overall project is intended to reduce taxpayer burden, minimize IRS time spent auditing plans and encourage plan sponsors to self-correct. Sponsors currently chosen for participation will receive a letter urging them to review their plan documents and operations for tax law compliance. If you’re selected and don’t reply to the IRS [...]

    Published On: February 25, 2024Categories: Federal Tax Posts
  • what is the employer-provided childcare tax credit?

    The employer-provided childcare tax credit is designed to help employers cover some of the qualified facility, resource and referral costs associated with providing childcare services to their employees. A qualified childcare facility is one that meets the requirements of all applicable laws and regulations of the state or local government in which it’s located. The credit is limited to $150,000 per year to offset 25% [...]

    Published On: February 24, 2024Categories: Federal Tax Posts
  • Do you have a “luxury” business vehicle?

    Recent IRS guidance provides the 2024 depreciation limits for “luxury” business vehicles. For vehicles placed in service in 2024, depreciation limits are $20,400 for year one, $19,800 for year two, $11,900 for year three and $7,160 for each year after that. This includes passenger cars, SUVs, trucks and vans. The IRS also announced lease inclusion amounts for lessees of passenger vehicles first leased in 2024. [...]

    Published On: February 23, 2024Categories: Federal Tax Posts
  • Taking your spouse on a business trip? Can you write off the costs?

      A recent report shows that post-pandemic global business travel is going strong. The market reached $665.3 billion in 2022 and is estimated to hit $928.4 billion by 2030, according to a report from Research and Markets. If you own your own company and travel for business, you may wonder whether you can deduct the costs of having your spouse accompany you on trips. Is your spouse [...]

    Published On: February 23, 2024Categories: Featured, Small Business Tax
  • Do you have a past due tax bill? Ask for a CDP!

    A taxpayer who disputes a past-due tax bill can request a Collection Due Process (CDP) hearing. At a CDP hearing, one taxpayer didn’t dispute his tax bill of $107,410 but he did submit an offer-in-compromise, proposing to make monthly installment payments of $25. He also proposed being granted currently-not-collectible status and asked for penalty abatement. After analyzing the taxpayer’s ability to pay, the IRS Service [...]

    Published On: February 22, 2024Categories: Federal Tax Posts
  • What’s the best accounting method route for business tax purposes?

      Businesses basically have two accounting methods to figure their taxable income: cash and accrual. Many businesses have a choice of which method to use for tax purposes. The cash method often provides significant tax benefits for eligible businesses, though some may be better off using the accrual method. Thus, it may be prudent for your business to evaluate its method to ensure that it’s [...]

    Published On: February 22, 2024Categories: Featured, Small Business Tax
  • Did your car dealer submit their report?

    If you’re in the market for an electric vehicle and hope to qualify for the new or used clean vehicle tax credit, take note: Deadlines for submitting seller reports to the IRS have been extended. Your seller is required to submit a report to the IRS Energy Credits portal by a specified deadline and provide you with a copy no later than three days after [...]

    Published On: February 21, 2024Categories: Federal Tax Posts
  • Liquidity overload: Why having too much cash may be bad for business

      In today’s uncertain marketplace, many businesses are stashing operating cash in their bank accounts, even though they might not have imminent plans to deploy their reserves. However, excessive “rainy day” funds could be an inefficient use of capital. Here’s a systematic approach to help estimate reasonable cash reserves and maximize your company’s return on long-term financial positions. What’s the harm in stockpiling cash? An [...]

    Published On: February 21, 2024Categories: Business, Featured
  • PLESA follow the rules!

    IRS notice 2024-22 provides anti-abuse guidance to employers that offer the new pension-linked emergency savings accounts (PLESAs). The procedures are intended to prevent participants from manipulating rules to cause excessive matching contributions. According to the IRS, a reasonable policy balances PLESA participants’ interests with the plan sponsor’s interest in preventing manipulation of matching contribution rules. On the other hand, it’s generally unreasonable to forfeit contributions [...]

    Published On: February 20, 2024Categories: Federal Tax Posts
  • Get ready for the 2023 gift tax return deadline

      Did you make large gifts to your children, grandchildren or others last year? If so, it’s important to determine if you’re required to file a 2023 gift tax return. In some cases, it might be beneficial to file one — even if it’s not required. Who must file? The annual gift tax exclusion has increased in 2024 to $18,000 but was $17,000 for 2023. [...]

    Published On: February 20, 2024Categories: Featured, Individual Tax
  • Update on IRS efforts to combat questionable Employee Retention Tax Credit claims

      The Employee Retention Tax Credit (ERTC) was introduced back when COVID-19 temporarily closed many businesses. The credit provided cash that helped enable struggling businesses to retain employees. Even though the ERTC expired for most employers at the end of the third quarter of 2021, it could still be claimed on amended returns after that. According to the IRS, it began receiving a deluge of [...]

    Published On: February 20, 2024Categories: Featured, Small Business Tax