With 2024 right around the corner, your shareholders might be thinking about year-end bonuses or distributions. Before doing so, it’s important to review the potential tax implications and requirements. Distributions vs. Bonuses S corporations don’t pay income tax at the entity level. Rather, income, gains, losses and deductions generally pass through to the shareholders who report […]
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Handle Payroll Taxes With Kid Gloves
If you operate a business that collects payroll taxes from employees, here’s a warning: Regardless of what your corporate financial situation is, don’t borrow from the withholding tax fund. If that money isn’t there when it’s due, Uncle Sam will crack down hard. All businesses face downturns when cash flow dries up. It may be tempting […]
Deposit Interest into Five Tax Buckets
Interest rates rise and fall periodically, but the tax rules for deducting interest expenses remain the same — unless Congress changes them. Generally, the current rules have been in place for years, although the Tax Cuts and Jobs Act of 2017 (TCJA) did include some significant modifications. Whether or not you can deduct interest expenses, and […]
Crypto: What Taxpayers Need to Know
Cryptocurrencies have gone mainstream. You can now invest in them and use them to buy and sell many products and services. However, crypto transactions have important federal tax implications that may not be well understood by everyone. Here’s an update on what you need to know about the federal tax issues if you exchange or receive […]
Update on Retirement Account RMDs
If you have a tax-favored retirement account, you generally must take required minimum distributions (RMDs) each year after you reach the “magic” age. If you don’t take RMDs, you’ll be hit with an expensive federal tax penalty, unless an exception applies. (See “Which Plans Are Affected by the RMD Rules?” at right.) The age that the […]
Cutting the Kiddie Tax Down to Size
Despite its name, the “kiddie tax” is anything but child’s play. If you’re not careful, this provision of the tax code can result in children having to pay significant extra tax dollars on their investment income. But your family may be able to downsize the kiddie tax for 2023 by making the right tax moves before […]
