How to determine "reasonable compensation" for corporate business owners
Today, many people sell homemade products online or work on some unincorporated sideline venture outside of their regular day jobs. Such activities can generate extra spending money. This can be especially helpful for retired people, stay-at-home parents and those who have been laid off or taken a pay cut during the COVID-19 crisis. For example, [...]
During the COVID-19 pandemic, many small businesses are strapped for cash. They may find it beneficial to barter for goods and services instead of paying cash for them. If your business gets involved in bartering, remember that the fair market value of goods that you receive in bartering is taxable income. In addition, if you [...]
Small businesses: take a proactive approach to recordkeeping If you operate a small business, or you’re starting a new one, you probably know you need to keep records of your income and expenses. In particular, you should carefully record your expenses in order to claim the full amount of the tax deductions to which you’re [...]
Do you own residential or commercial rental real estate? The Tax Cuts and Jobs Act (TCJA) brings several important changes that owners of rental properties should understand. In general, tax reform affects rental property owners- owners will enjoy lower ordinary income tax rates and other favorable changes to the tax brackets for 2018 through [...]
Taxpayers often have questions about Individual Retirement Arrangements, or IRAs. Common questions include: When can a person contribute, how does an IRA impact taxes, and what are other common rules. The IRS offers the following tax tips on IRAs: Age Rules. Taxpayers must be under age 70½ at the end of the tax year to [...]
Does your professional services firm have a minimal marketing budget or lack in-house marketing staff? Are some of your competitors outspending you 2, 5 or even 10 to 1? Under such circumstances, attracting new business may seem like an impossible goal. But professional service firms with small budgets can market themselves effectively and build their [...]
When couples separate or divorce, one is often required to make payments to the other. If these payments meet the tax-law definition of alimony, the one making the payments can deduct them, and the recipient must include them as taxable income. Payments intended as alimony are often substantial, so it is important to identify and record these payments correctly.
In Mid-May of 2014, a new accounting standard titled, Revenue from Contracts with Customers, was issued. The standard provides a unified set of principles for recognizing revenues — replacing the current mishmash of more than 80 industry-specific revenue-recognition rules.