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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.

Nonqualified Stock Options Demand Tax Planning Attention

Posted by on Jul 27, 2017 in Blog, General, Management, Tax Tips | Comments Off on Nonqualified Stock Options Demand Tax Planning Attention

Nonqualified Stock Options Demand Tax Planning Attention

Your compensation may take several forms, including salary, fringe benefits and bonuses. If you work for a corporation, you might also receive stock-based compensation, such as stock options. These come in two varieties: nonqualified (NQSOs) and incentive (ISOs). With both NQSOs and ISOs, if the stock appreciates beyond your exercise price, you can buy shares at a price below what they’re trading for. However, the tax consequences of stock-based compensation can be complex. So smart tax planning is critical. Let’s take a closer look at the...

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3 Midyear Tax Planning Strategies for Business

Posted by on Jul 24, 2017 in Blog, General, Management, Tax Tips | Comments Off on 3 Midyear Tax Planning Strategies for Business

3 Midyear Tax Planning Strategies for Business

Tax reform has been a major topic of discussion in Washington, but it’s still not clear exactly what this legislation will include and if it will be signed into law this year. However, the last major tax legislation that was signed into law (back in December of 2015) still has a significant impact on tax planning for businesses. Let’s look at three midyear tax strategies inspired by the Protecting Americans from Tax Hikes (PATH) Act: 1. Buying equipment. The PATH Act preserved both the generous limits for the Section 179 expensing election...

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Own a Vacation Home? Adjusting Rental vs. Personal Use Might Save Taxes

Posted by on Jul 24, 2017 in Blog, General, Management, Tax Tips | Comments Off on Own a Vacation Home? Adjusting Rental vs. Personal Use Might Save Taxes

Own a Vacation Home? Adjusting Rental vs. Personal Use Might Save Taxes

If you own a vacation home that you both rent out and use personally, it’s a good time to review the potential tax consequences: If you rent it out for less than 15 days: You don’t have to report the income. But expenses associated with the rental (such as advertising and cleaning) won’t be deductible. If you rent it out for 15 days or more: You must report the income. The expenses you can deduct depend on how the home is classified for tax purposes, based on the amount of personal vs. rental use: Rental property. If you (or your immediate...

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Keep Real Estate Separate From Your Business’s Corporate Assets to Save Tax

Posted by on Jul 20, 2017 in Blog, General, Management, Tax Tips | Comments Off on Keep Real Estate Separate From Your Business’s Corporate Assets to Save Tax

Keep Real Estate Separate From Your Business’s Corporate Assets to Save Tax

It’s common for a business to own not only typical business assets, such as equipment, inventory and furnishings, but also the building where the business operates — and possibly other real estate as well. However, there can be negative consequences when a business’s real estate is included in its general corporate assets. Owners can save tax and enjoy other benefits by holding real estate in a separate entity. Capturing tax savings Many businesses operate as C corporations so they can buy and hold real estate just as they do equipment,...

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All Fringe Benefits Aren’t Created Equal for Tax Purposes

Posted by on Jul 17, 2017 in Blog, General, Management, Tax Tips | Comments Off on All Fringe Benefits Aren’t Created Equal for Tax Purposes

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 | Comments Off on Summer Is a Good Time to Start Your 2017 Tax Planning and Organize Your Tax Records

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 | Comments Off on Claiming a Federal Tax Deduction for Moving Costs

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 | Comments Off on 3 Breaks for Business Charitable Donations You May Not Know About

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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