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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.

Why Making Annual Exclusion Gifts Before Year End Can Still Be a Good Idea

Posted by on Dec 19, 2016 in Blog, General, Management, Tax Tips | Comments Off on Why Making Annual Exclusion Gifts Before Year End Can Still Be a Good Idea

Why Making Annual Exclusion Gifts Before Year End Can Still Be a Good Idea

A tried-and-true estate planning strategy is to make tax-free gifts to loved ones while you’re still alive, because it reduces potential estate tax at death. There are several ways to make tax-free gifts, but one of the simplest is to take advantage of the annual gift tax exclusion with direct gifts. Even in a potentially changing estate tax environment, making annual exclusion gifts before year end can still be a good idea. What is the annual exclusion? The 2016 gift tax annual exclusion allows you to give up to $14,000 per recipient...

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Workers Age 50 and Up: Boost Retirement Savings Before Year End with Catch-up Contributions

Posted by on Dec 12, 2016 in Blog, General, Management, Tax Tips | Comments Off on Workers Age 50 and Up: Boost Retirement Savings Before Year End with Catch-up Contributions

Workers Age 50 and Up: Boost Retirement Savings Before Year End with Catch-up Contributions

Whether you didn’t save as much for retirement as you would have wished earlier in your career or you’d like to make the most of tax-advantaged savings opportunities, if you’ll be age 50 or older on December 31, consider making “catch-up” contributions to your employer-sponsored retirement plan by that date. These are additional contributions beyond the regular annual limits that can be made to certain retirement accounts. 401(k)s and SIMPLEs Under 2016 401(k) limits, if you’re age 50 or older, after you’ve reached the $18,000 maximum limit...

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Can You Pay Bonuses in 2017 But Deduct Them This Year?

Posted by on Dec 8, 2016 in Blog, General, Management, Tax Tips | Comments Off on Can You Pay Bonuses in 2017 But Deduct Them This Year?

Can You Pay Bonuses in 2017 But Deduct Them This Year?

You may be aware of the rule that allows businesses to deduct bonuses employees have earned during a tax year if the bonuses are paid within 2½ months after the end of that year (by March 15 for a calendar-year company). But this favorable tax treatment isn’t always available. For one thing, only accrual-basis taxpayers can take advantage of the 2½ month rule — cash-basis taxpayers must deduct bonuses in the year they’re paid, regardless of when they’re earned. However, even for accrual-basis taxpayers, the 2½ month rule isn’t automatic. The...

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There’s Still Time to Benefit on Your 2016 Tax Bill by Buying Business Assets

Posted by on Dec 5, 2016 in Blog, General, Management, Tax Tips | Comments Off on There’s Still Time to Benefit on Your 2016 Tax Bill by Buying Business Assets

There’s Still Time to Benefit on Your 2016 Tax Bill by Buying Business Assets

In order to take advantage of two important depreciation tax breaks for business assets, you must place the assets in service by the end of the tax year. So you still have time to act for 2016. Section 179 deduction The Sec. 179 deduction is valuable because it allows businesses to deduct as depreciation up to 100% of the cost of qualifying assets in year 1 instead of depreciating the cost over a number of years. Sec. 179 can be used for fixed assets, such as equipment, software and leasehold improvements. Air conditioning and heating units...

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Year-End Tax Strategies for Accrual-Basis Taxpayers

Posted by on Dec 1, 2016 in Blog, General, Management, Tax Tips | Comments Off on Year-End Tax Strategies for Accrual-Basis Taxpayers

Year-End Tax Strategies for Accrual-Basis Taxpayers

The last month of the year offers accrual-basis taxpayers an opportunity to make some timely moves that might enable them to save money on their 2016 tax bill. Record and recognize The key to saving tax as an accrual-basis taxpayer is to properly record and recognize expenses that were incurred this year but won’t be paid until 2017. This enables you to deduct those expenses on your 2016 federal tax return. Common examples of these expenses include: Commissions, salaries and wages, Payroll taxes, Advertising, Interest, Utilities, Insurance,...

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Accelerating Your Property Tax Deduction To Reduce Your 2016 Tax Bill

Posted by on Nov 28, 2016 in Blog, General, Management, Tax Tips | Comments Off on Accelerating Your Property Tax Deduction To Reduce Your 2016 Tax Bill

Accelerating Your Property Tax Deduction To Reduce Your 2016 Tax Bill

Smart timing of deductible expenses can reduce your tax liability, but poor timing can unnecessarily increase it. When you don’t expect to be subject to the alternative minimum tax (AMT) in the current year, accelerating deductible expenses into the current year typically is a good idea because it will defer tax, which usually is beneficial. One deductible expense you may be able to control is your property tax payment. You can prepay (by December 31) property taxes that relate to 2016 but that are due in 2017, and deduct the payment on your...

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A Quick Look At The President-Elect’s Tax Plan For Individuals

Posted by on Nov 25, 2016 in Blog, General, Management, Tax Tips | Comments Off on A Quick Look At The President-Elect’s Tax Plan For Individuals

A Quick Look At The President-Elect’s Tax Plan For Individuals

In our last post we discussed how Donald Trump’s proposed tax plan could possibly affect businesses. In this post we’ll discuss how his plan could affect individuals. President-elect Trump’s tax reform plan, released earlier this year, includes the following changes that would affect individuals: Reducing the number of income tax brackets from seven to three, with rates on ordinary income of 12%, 25% and 33% (reducing rates for many taxpayers but resulting in a tax hike for certain single filers), Aligning the 0%, 15% and 20% long-term...

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A Quick Look At The President-Elect’s Tax Plan For Businesses

Posted by on Nov 21, 2016 in Blog, General, Management, Tax Tips | Comments Off on A Quick Look At The President-Elect’s Tax Plan For Businesses

A Quick Look At The President-Elect’s Tax Plan For Businesses

Donald Trump’s election as President of the United States could result in major changes to the tax law in 2017. Proposed changes spelled out in Trump’s tax reform plan were released earlier this year. The changes that would affect businesses include: Reducing the top corporate income tax rate from 35% to 15%, Abolishing the corporate alternative minimum tax (AMT), Allowing owners of flow-through entities to pay tax on business income at the proposed 15% corporate rate rather than their own individual income tax rate, although there seems to...

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There’s Still Time to Set Up a Retirement Plan for 2016

Posted by on Nov 17, 2016 in Blog, General, Management, Tax Tips | Comments Off on There’s Still Time to Set Up a Retirement Plan for 2016

There’s Still Time to Set Up a Retirement Plan for 2016

Saving for retirement can be tough if you’re putting most of your time and money into operating a small business. However, many retirement plans aren’t difficult to set up and it’s important to start saving so you can enjoy a comfortable future. If you haven’t already set up a tax-advantaged plan, consider doing so this year. Note: If you have employees, they generally must be allowed to participate in the plan, provided they meet the qualification requirements. Here are three options: Profit-sharing plan: This is a defined contribution plan...

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It’s Time to “Harvest” Investment Losses

Posted by on Nov 14, 2016 in Blog, General, Management, Tax Tips | Comments Off on It’s Time to “Harvest” Investment Losses

It’s Time to “Harvest” Investment Losses

If you hold investments outside of tax-advantaged retirement plans, you may be able to take steps before year end to reduce your 2016 tax liability. Offsetting gains with losses Suppose you’ve sold investments at a loss this year but you have other investments in your portfolio that have appreciated. If you believe those appreciated investments have peaked in value, you may want to sell them before this year ends, at least to the extent that the gains from the sales will be offset by your losses. What if you’ve sold investments and are...

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