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Adam’s Tax Accounting Service Blog

Note: Tax advice, articles, and content contained on this site are intended for informational and educational purposes only. They are not a substitute for professional advice. Tax matters are can be extremely complex and vary greatly for each individual or company. Please click here to read our complete disclosure and disclaimer for the information presented on this site.

Make Sure the IRS Won’t Consider Your Business To Be a “Hobby”

Posted by on Mar 24, 2017 in Blog, General, Management, Tax Tips | 0 comments

Make Sure the IRS Won’t Consider Your Business To Be a “Hobby”

If you run a business “on the side” and derive most of your income from another source (another business you own, employment or investments), you may face a peculiar risk: Under certain circumstances, this on-the-side business might not be a business in the eyes of the IRS. It may be considered a hobby. The hobby loss rules Generally, a taxpayer can deduct losses from profit-motivated activities, either from other income in the same tax year or by carrying the loss back to a previous tax year or forward to a future tax year. But, to ensure...

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The Section 1031 Exchange: Why It’s Such a Great Tax Planning Tool

Posted by on Mar 20, 2017 in Blog, General, Management, Tax Tips | 0 comments

The Section 1031 Exchange: Why It’s Such a Great Tax Planning Tool

If you’re like many business owners, you might also own highly appreciated business or investment real estate. Fortunately, there’s an effective tax planning strategy at your disposal: the Section 1031 “like kind” exchange. It can help you defer capital gains tax on appreciated property indefinitely. How it works Section 1031 of the Internal Revenue Code allows you to defer gains on real or personal property used in a business or held for investment if, instead of selling it, you exchange it solely for property of a “like kind.” In fact,...

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2016 IRA Contributions — It’s Not Too Late!

Posted by on Mar 16, 2017 in Blog, General, Management, Tax Tips | 0 comments

2016 IRA Contributions — It’s Not Too Late!

There’s still time for you to make 2016 contributions to your IRA. The deadline for such contributions is April 18, 2017. If the contribution is deductible, it will lower your 2016 tax bill. But even if it isn’t, making a 2016 contribution is probably a good idea. Benefits beyond a deduction Tax-advantaged retirement plans like IRAs allow your money to grow tax-deferred — or, in the case of Roth accounts, tax-free. But annual contributions are limited by tax law, and any unused limit can’t be carried forward to make larger contributions in...

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When an Elderly Parent Might Qualify as Your Dependent

Posted by on Mar 9, 2017 in Blog, General, Management, Tax Tips | 0 comments

When an Elderly Parent Might Qualify as Your Dependent

It’s not uncommon for adult children to help support their aging parents. If you’re in this position, you might qualify for the adult-dependent exemption. It allows eligible taxpayers to deduct up to $4,050 for each adult dependent claimed on their 2016 tax return. Basic qualifications In order for you to qualify for the adult-dependent exemption, in most cases your parent must have less gross income for the tax year than the exemption amount. (Exceptions may apply if your parent is permanently and totally disabled.) Generally Social Security...

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Filing Deadline Rapidly Approaching for Flow-Through Entities

Posted by on Mar 7, 2017 in Blog, General, Management, Tax Tips | 0 comments

Filing Deadline Rapidly Approaching for Flow-Through Entities

The federal income tax filing deadline for calendar-year partnerships, C and S corporations and limited liability companies (LLCs) treated as partnerships or S corporations for tax purposes is March 15. Note: While this deadline is nothing new for S corporation returns, it’s earlier than previous years for partnership returns. In addition to providing continued funding for federal transportation projects, the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 changed the due dates for several types of tax and...

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When It Comes to Charitable Deductions, All Donations Aren’t Created Equal

Posted by on Mar 6, 2017 in Blog, General, Management, Tax Tips | 0 comments

When It Comes to Charitable Deductions, All Donations Aren’t Created Equal

As you file your 2016 income tax return and plan your charitable giving for 2017, it’s important to keep in mind the available deduction. It can vary significantly depending on a variety of factors. What you give Other than the actual amount you donate, one of the biggest factors that could affect your deduction is what you give: Cash. This includes not just actual cash but gifts made by check, credit card or payroll deduction. You may deduct 100%. Ordinary-income property. Examples include stocks and bonds held one year or less, inventory,...

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Tangible Property Safe Harbors Help Maximize Deductions

Posted by on Mar 2, 2017 in Blog, General, Management, Tax Tips | 0 comments

Tangible Property Safe Harbors Help Maximize Deductions

If your business made repairs to tangible property last year, such as buildings, machinery, equipment or vehicles, you may be eligible for a valuable deduction on your 2016 income tax return. However, you must make sure they were truly “repairs,” and not actually “improvements.” Why? Costs incurred to improve tangible property must be depreciated over a period of years. But costs incurred on incidental repairs and maintenance can be expensed and immediately deducted. What’s an “improvement”? In general, costs that result in an improvement to...

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Can the WOTC Save Tax for Your Business?

Posted by on Feb 27, 2017 in Blog, General, Management, Tax Tips | 0 comments

Can the WOTC Save Tax for Your Business?

Employers that hire individuals who are members of a “target group” may be eligible for the Work Opportunity tax credit (WOTC). If you made qualifying hires in 2016 and obtained proper certification, you can claim the WOTC on your 2016 tax return. Whether or not you’re eligible for 2016, keep the WOTC in mind in your 2017 hiring, because the credit is also available for 2017. In fact, the Protecting Americans from Tax Hikes Act of 2015 (the PATH Act) extended the WOTC through 2019. The PATH Act also expanded the credit beginning in 2016 to...

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Deduct All of the Mileage You’re Entitled to — But Not More

Posted by on Feb 23, 2017 in Blog, General, Management, Tax Tips | 0 comments

Deduct All of the Mileage You’re Entitled to — But Not More

Employees and self-employed taxpayers can use a standard mileage rate to compute their deduction related to using a vehicle for business rather than keeping track of the actual cost of operating a vehicle. But you might also be able to deduct miles driven for other purposes, including medical, moving and charitable purposes. What are the deduction rates? The rates vary depending on the purpose and the year: Business: 54 cents (2016), 53.5 cents (2017) Medical: 19 cents (2016), 17 cents (2017) Moving: 19 cents (2016), 17 cents (2017)...

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Do You Need to File a 2016 Gift Tax Return by April 18?

Posted by on Feb 20, 2017 in Blog, General, Management, Tax Tips | 0 comments

Do You Need to File a 2016 Gift Tax Return by April 18?

As part of your estate planning strategy, you may have made significant gifts to your children, grandchildren or other heirs last year. Or perhaps you just wanted to provide loved ones with some helpful financial support. Regardless of the reason for making a gift, it’s important to know under what circumstances you’re required to file a gift tax return. Some transfers require a return even if you don’t owe tax. And sometimes it’s desirable to file a return even if it isn’t required. When filing is required Generally, you’ll need to file a...

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