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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.

All Fringe Benefits Aren’t Created Equal for Tax Purposes

Posted by on Jul 17, 2017 in Blog, General, Management, Tax Tips | 0 comments

All Fringe Benefits Aren’t Created Equal for Tax Purposes

According to IRS Publication 5137, Fringe Benefit Guide, a fringe benefit is “a form of pay (including property, services, cash or cash equivalent), in addition to stated pay, for the performance of services.” But the tax treatment of a fringe benefit varies based on the type of benefit. Generally, the IRS takes one of four tax approaches to fringe benefits: 1. Taxable/includable. The value of benefits in this category are taxable because they must be included in employees’ gross income as wages and reported on Form W-2. They’re usually also...

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Summer Is a Good Time to Start Your 2017 Tax Planning and Organize Your Tax Records

Posted by on Jul 13, 2017 in Blog, General, Management, Tax Tips | 0 comments

Summer Is a Good Time to Start Your 2017 Tax Planning and Organize Your Tax Records

You may want to forget all about taxes during summertime, when “the livin’ is easy,” as the Gershwin song goes. But if you start your tax planning now, you could avoid an unpleasant tax surprise when you file next year. Summer is also a good time to set up a storage system for your tax records. Here are some tips: Take action when life changes occur. Some life events (such as marriage, divorce, or the birth of a child) can change the amount of tax you owe. When they happen, you may need to change the amount of tax withheld from your pay. To...

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Claiming a Federal Tax Deduction for Moving Costs

Posted by on Jul 3, 2017 in Blog, General, Management, Tax Tips | 0 comments

Claiming a Federal Tax Deduction for Moving Costs

Summer is a popular time to move, whether it’s so the kids don’t have to change schools mid-school-year, to avoid moving in bad weather, or simply because it can be an easier time to sell your home. Unfortunately, moving can be expensive. The good news is you might be eligible for a federal tax deduction for your moving costs. Pass the tests The first requirement is that the move be work-related. You don’t have to be an employee; the self-employed can also be eligible for the moving expense deduction. The second is a distance test. The new...

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3 Breaks for Business Charitable Donations You May Not Know About

Posted by on Jun 28, 2017 in Blog, General, Management, Tax Tips | 0 comments

3 Breaks for Business Charitable Donations You May Not Know About

Donating to charity is more than good business citizenship; it can also save tax dollars. Here are three lesser-known federal income tax breaks for charitable donations made by businesses. 1. Food donations Charitable write-offs for donated food (such as by restaurants and grocery stores) are normally limited to the lower of the taxpayer’s basis in the food (generally cost) or fair market value (FMV), but an enhanced deduction equals the lesser of: The food’s basis plus one-half the FMV in excess of basis, or Two times the basis. To qualify,...

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Pay Attention to the Details When Selling Investments

Posted by on Jun 19, 2017 in Blog, General, Management, Tax Tips | Comments Off on Pay Attention to the Details When Selling Investments

Pay Attention to the Details When Selling Investments

The tax consequences of selling an investment, as well as your net return, can be affected by a variety of factors. You’re probably focused on factors such as how much you paid for the investment vs. how much you’re selling it for, whether you held the investment long-term (more than one year) and the tax rate that will apply. But there are additional details you should pay attention to. If you don’t, the tax consequences of a sale may be different from what you expect. Here are a few details to consider when selling an investment: Which...

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Dot the “I’s” and Cross the “T’s” on Loans Between Your Business and Its Owners

Posted by on Jun 15, 2017 in Blog, General, Management, Tax Tips | Comments Off on Dot the “I’s” and Cross the “T’s” on Loans Between Your Business and Its Owners

Dot the “I’s” and Cross the “T’s” on Loans Between Your Business and Its Owners

It’s common for closely held businesses to transfer money into and out of the company. This often takes place in the form of a loan. However, the IRS looks closely at such transactions: Are they truly loans, or actually compensation, distributions or contributions to equity? Loans to owners When an owner withdraws funds from the company, the transaction can be characterized as compensation, a distribution, or a loan. Loans aren’t taxable, but compensation is and distributions may be. If the company is a C corporation and the transaction is...

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Coverdell ESAs: The Tax-Advantaged Way to Fund Elementary and Secondary School Costs

Posted by on Jun 12, 2017 in Blog, General, Management, Tax Tips | Comments Off on Coverdell ESAs: The Tax-Advantaged Way to Fund Elementary and Secondary School Costs

Coverdell ESAs: The Tax-Advantaged Way to Fund Elementary and Secondary School Costs

With school letting out you might be focused on summer plans for your children (or grandchildren). But the end of the school year is also a good time to think about Coverdell Education Savings Accounts (ESAs) — especially if the children are in grade school or younger. One major advantage of ESAs over another popular education saving tool, the Section 529 plan, is that tax-free ESA distributions aren’t limited to college expenses; they also can fund elementary and secondary school costs. That means you can use ESA funds to pay for such...

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Choosing the Best Way to Reimburse Employee Travel Expenses

Posted by on Jun 8, 2017 in Blog, General, Management, Tax Tips | Comments Off on Choosing the Best Way to Reimburse Employee Travel Expenses

Choosing the Best Way to Reimburse Employee Travel Expenses

If you have employees that incur work-related travel expenses, you can better attract and retain the best talent by reimbursing these expenses. But to secure tax-advantaged treatment for your business and your employees, it’s critical to comply with IRS rules. Reasons to reimburse While unreimbursed work-related travel expenses generally are deductible on a taxpayer’s individual tax return (subject to a 50% limit for meals and entertainment) as a miscellaneous itemized deduction, many employees won’t be able to benefit from the deduction....

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Consider the Tax Consequences Before Making an Employee a Partner

Posted by on Jun 5, 2017 in Blog, General, Management, Tax Tips | Comments Off on Consider the Tax Consequences Before Making an Employee a Partner

Consider the Tax Consequences Before Making an Employee a Partner

In today’s competitive environment, offering your employees an equity interest in your business can be a powerful tool for attracting, retaining and motivating quality talent. However, if your business is organized as a partnership, there are some tax traps you need to watch out for. Once an employee becomes a partner, you generally can no longer treat him or her as an employee for tax and benefits purposes, which has significant tax implications. Employment taxes Employees pay half of the Social Security and Medicare taxes on their wages,...

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Donating a Vehicle Might Not Provide the Tax Deduction You Expect

Posted by on Jun 1, 2017 in Blog, General, Management, Tax Tips | Comments Off on Donating a Vehicle Might Not Provide the Tax Deduction You Expect

Donating a Vehicle Might Not Provide the Tax Deduction You Expect

All charitable donations aren’t created equal. Some of them provide larger deductions than others. How much or even what you donate isn’t always what matters. How the charity uses your donation might also affect your deduction. Take vehicle donations, for example. If you donate your vehicle, the value of your deduction can vary greatly depending on what the charity does with it. Determining your deduction You can deduct the vehicle’s fair market value (FMV) if the charity: Uses the vehicle for a significant charitable purpose (such as...

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