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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.

The “Manufacturers’ Deduction” Isn’t Just for Manufacturers

Posted by on Feb 9, 2017 in Blog, General, Management, Tax Tips | Comments Off on The “Manufacturers’ Deduction” Isn’t Just for Manufacturers

The “Manufacturers’ Deduction” Isn’t Just for Manufacturers

The Section 199 deduction is intended to encourage domestic manufacturing. In fact, it’s often referred to as the “manufacturers’ deduction.” But this potentially valuable tax break can be used by many other types of businesses besides manufacturing companies. Sec. 199 deduction 101 The Sec. 199 deduction, also called the “domestic production activities deduction,” is 9% of the lesser of qualified production activities income or taxable income. The deduction is also limited to 50% of W-2 wages paid by the taxpayer that are allocable to...

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2016 Higher-Education Breaks Can Save Your Family Taxes

Posted by on Feb 6, 2017 in Blog, General, Management, Tax Tips | Comments Off on 2016 Higher-Education Breaks Can Save Your Family Taxes

2016 Higher-Education Breaks Can Save Your Family Taxes

Did you have a college student in your family last year? Were you a student yourself? If so, you may be eligible for some valuable tax breaks on your 2016 return. To max out your higher education breaks, you need to see which ones you’re eligible for and then claim the one(s) that provide the greatest benefit. In most cases you can take only one break per student, and, for some breaks, only one per tax return. Credits vs. deductions Tax credits can be especially valuable because they reduce taxes dollar-for-dollar; deductions reduce only the...

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The Investment Interest Expense Deduction: Less Beneficial Than You Might Think

Posted by on Feb 2, 2017 in Blog, General, Management, Tax Tips | Comments Off on The Investment Interest Expense Deduction: Less Beneficial Than You Might Think

The Investment Interest Expense Deduction: Less Beneficial Than You Might Think

Investment interest — interest on debt used to buy assets held for investment, such as margin debt used to buy securities — is generally deductible for both regular tax and alternative minimum tax (AMT) purposes. But special rules apply that can make this itemized deduction less beneficial than you might think. Limits on the deduction First, you can’t deduct interest you incurred to produce tax-exempt income. For example, if you borrow money to invest in municipal bonds, which are exempt from federal income tax, you can’t deduct the interest....

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Why 2016 May Be an Especially Good Year to Take Bonus Depreciation

Posted by on Jan 30, 2017 in Blog, General, Management, Tax Tips | Comments Off on Why 2016 May Be an Especially Good Year to Take Bonus Depreciation

Why 2016 May Be an Especially Good Year to Take Bonus Depreciation

Bonus depreciation allows businesses to recover the costs of depreciable property more quickly by claiming additional first-year depreciation for qualified assets. The PATH Act, signed into law a little over a year ago, extended 50% bonus depreciation through 2017. Claiming this break is generally beneficial, though in some cases a business could save more tax in the long run if they forgo it. However, 2016 may be an especially good year to take bonus depreciation – something to keep in mind when you’re filing your 2016 tax return....

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Deduction for State and Local Sales Tax Benefits Some, but Not All, Taxpayers

Posted by on Jan 26, 2017 in Blog, General, Management, Tax Tips | Comments Off on Deduction for State and Local Sales Tax Benefits Some, but Not All, Taxpayers

Deduction for State and Local Sales Tax Benefits Some, but Not All, Taxpayers

The break allowing taxpayers to take an itemized deduction for state and local sales taxes in lieu of state and local income taxes was made “permanent” a little over a year ago. This break can be valuable to those residing in states with no or low income taxes or who purchase major items, such as a car or boat. Your 2016 tax return How do you determine whether you can save more by deducting sales tax on your 2016 return? Compare your potential deduction for state and local income tax to your potential deduction for state and local sales tax....

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Can You Defer Taxes On Advance Payments?

Posted by on Jan 23, 2017 in Blog, General, Management, Tax Tips | Comments Off on Can You Defer Taxes On Advance Payments?

Can You Defer Taxes On Advance Payments?

Many businesses receive payment in advance for goods and services. Examples include magazine subscriptions, long-term supply contracts, organization memberships, computer software licenses, and gift cards. Generally, advance payments are included in taxable income in the year they’re received, even if you defer a portion of the income for financial reporting purposes. But there are exceptions that could provide you with some savings when you file your 2016 income tax return. Deferral opportunities The IRS allows limited deferral of income...

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Help Prevent Tax Identity Theft by Filing Early

Posted by on Jan 19, 2017 in Blog, General, Management, Tax Tips | Comments Off on Help Prevent Tax Identity Theft by Filing Early

Help Prevent Tax Identity Theft by Filing Early

If you’re like many Americans, you might not start thinking about filing your tax return until close to this year’s April 18 deadline. You might even want to file for an extension so you don’t have to send your return to the IRS until October 16. But there’s another date you should keep in mind: January 23. That’s the date the IRS will begin accepting 2016 returns. Filing as close to that date as possible could protect you from tax identity theft. Why early filing helps In an increasingly common scam, thieves use victims’ personal information...

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New HRA Offers Small Employers an Attractive, Tax-Advantaged Health Care Option

Posted by on Jan 19, 2017 in Blog, General, Management, Tax Tips | Comments Off on New HRA Offers Small Employers an Attractive, Tax-Advantaged Health Care Option

New HRA Offers Small Employers an Attractive, Tax-Advantaged Health Care Option

In December, Congress passed the 21st Century Cures Act. This long and complex bill covers a broad range of health care topics. Of particular interest to some businesses should be the Health Reimbursement Arrangement (HRA) provision. With this provision, qualified small employers can now use HRAs to reimburse employees who purchase individual insurance coverage, rather than providing employees with costly group health plans. The need for HRA relief Employers can use HRAs to reimburse their workers’ medical expenses, including health insurance...

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2017 Q1 Tax Calendar: Key Deadlines for Businesses and Other Employers

Posted by on Jan 5, 2017 in Blog, General, Management, Tax Tips | Comments Off on 2017 Q1 Tax Calendar: Key Deadlines for Businesses and Other Employers

2017 Q1 Tax Calendar:  Key Deadlines for Businesses and Other Employers

Here are some of the key tax-related deadlines affecting businesses and other employers during the first quarter of 2017. Keep in mind that this list isn’t all-inclusive, so there may be additional deadlines that apply to you. Contact us to ensure you’re meeting all applicable deadlines and to learn more about the filing requirements. January 31 File 2016 Forms W-2, “Wage and Tax Statement,” with the Social Security Administration and provide copies to your employees. File 2016 Forms 1099-MISC, “Miscellaneous Income,” reporting nonemployee...

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How Entity Type Affects Tax Planning for Owner-Employees

Posted by on Jan 5, 2017 in Blog, General, Management, Tax Tips | Comments Off on How Entity Type Affects Tax Planning for Owner-Employees

How Entity Type Affects Tax Planning for Owner-Employees

Come tax time, owner-employees face a variety of tax planning challenges, depending on whether their business is structured as a partnership, limited liability company (LLC) or corporation. When you’re thinking about your 2016 filing or planning for 2017, it’s important to be aware of the challenges that apply to your particular situation. Partnerships and LLCs If you’re a partner in a partnership or a member of an LLC that has elected to be disregarded or treated as a partnership, the entity’s income flows through to you (as well as its...

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