If your small business regularly uses independent contractors or just hires a gardener occasionally, you may need to file a Form 1099-MISC with the IRS. 1099-MISC’s help the IRS prevent tax evasion by creating a record of income that may otherwise go unreported. For that reason, there are steep penalties, including fines up to $550…
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Did you know that if you are a US citizen and you are earning any income from streaming you might be on the responsible for paying taxes on the donations you receive? Despite their misleading name, donations are not tax free like the kinds of donations you give to a charity. They are taxable income!…
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Effective Management of Business Finances Most small business owners and entrepreneurs juggle every aspect of business management, from administrative tasks to bookkeeping and accounting duties. Many small business owners and entrepreneurs reach a point where managing every task becomes overwhelming and an ineffective use of time. Effective management of business finances is critical for reporting,…
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A very common question that comes up, particularly with new small businesses, is whether you should separate your business bank account from your personal bank account. The general rule of thumb is that you should not comingle your bank accounts and here is why. It prevents you from using the business funds for a personal…
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Borrowers who received Paycheck Protection Program (PPP) loans under the Coronavirus Aid, Relief, and Economic Security (CARES) Act are asking their tax professionals if and how they will qualify for PPP loan forgiveness. There is uncertainty over some of the program details. Organizations. especially small to medium sized businesses, worry about meeting the loan forgiveness…
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Deducting Passive Losses A taxpayer can overcome the presumption that all rental activities are passive if the taxpayer qualifies as a real estate professional by satisfying the two tests of Sec. 469(c)(7)(B): More than one-half of the personal services performed in trades or businesses by you during the tax year are performed in real property…
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Unless you have more than $5M in annual revenues (more likely, less than $10M) it will be more cost effective to outsource your bookkeeping and accounting needs. Outsourcing is more flexible, which will allow you to scale your services up or down as your business needs change and you do not have to pay a…
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50 Percent Deductions: • Lunch with customer, client or employee associated with a business discussion Taxes and tips relating to a meal or entertainment activity • Room rental for a dinner or cocktail party (assuming the event met the business relation test) 100 Percent Deductions: • Transportation costs to and from a business meal or…
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According to the IRS, your property is placed in service when it is both ready and available for rent. If you recently purchased a property you hope to rent out for passive income, this is critical information for you. You ideally want to have the property “in service” to reap the best tax benefits. Usually,…
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As you start to invest in more real estate, you might ask yourself, should I setup a bank account for each property? The answer is you will likely want to begin using one account for each property for simplicity. However, you cannot have 10 bank accounts for 10 properties, it is just too much to…
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