Wondering why your receiving more money in your paycheck since February?

The IRS has released a new version of Form W-4 and a revised Withholding Calculator on irs.gov (IR-2018-36). These updated tools can help you check your 2018 tax withholding to determine if it’s still appropriate following passage of the Tax Cuts and Jobs Act in December 2017. The IRS urges taxpayers to use these tools to make sure they have the right amount of tax withheld from their paychecks, taking…  Read more

IRS Releases Updated Form W-4 and Withholding Calculator

The IRS has released a new version of Form W-4 and a revised Withholding Calculator on irs.gov (IR-2018-36). These updated tools can help you check your 2018 tax withholding to determine if it’s still appropriate following passage of the Tax Cuts and Jobs Act in December 2017. The IRS urges taxpayers to use these tools to make sure they have the right amount of tax withheld from their paychecks, taking…  Read more

Federal Income Tax Returns Due for Most Individuals

The federal income tax filing deadline for most individuals is Tuesday, April 17, 2018. That’s because April 15 falls on a Sunday, and  Emancipation Day, a legal holiday in Washington, D.C., falls on Monday, April 16, this year. Need more time? If you’re not able to file your federal income tax return by the due date, you can  file for an extension using IRS Form 4868, Application for Automatic Extension…  Read more

What is a qualified domestic relations order (QDRO) and how could it effect your income tax?

A qualified domestic relations order (QDRO) is a court judgment, decree, or order establishing the marital property rights of a spouse, former spouse, child, or dependent of a pension plan participant with respect to certain qualified retirement plans. Several requirements and restrictions apply. To what extent are retirement assets subject to divorce court jurisdiction? A retirement plan is a form of property. Like houses, cars, and bank accounts, a retirement…  Read more

Are alimony payments considered taxable income?

Alimony is a support payment made to a former (or separated) spouse under a divorce decree or separation instrument in an attempt to maintain the predivorce lifestyle. Alimony is sometimes called maintenance. Simply stated, for pre-2018 divorces, alimony is taxable income to the one who receives it and tax deductible to the one who pays it. However, the divorce agreement can designate alimony as nontaxable and nondeductible. For post-2017 divorces,…  Read more

Tax Planning with Life Insurance

What is tax planning with life insurance? Life insurance can help you achieve various goals. Tax planning with life insurance involves minimizing the tax consequences of your life insurance decisions. Tax planning vehicles involving life insurance will vary, depending on the form of insurance coverage you select. In order to make informed insurance tax planning decisions, you must understand topics such as the tax-deferred buildup of cash value, the taxation…  Read more

Understanding Personal Tax Credits

Have you ever thought that you’re paying too much income tax? You may be, if you’re not claiming all of the tax credits for which you are eligible when you file your federal tax return. These credits may significantly reduce your tax liability. What is a tax credit? A tax credit is a dollar-for-dollar reduction of your tax liability. Generally, after you’ve calculated your federal taxable income and worked out…  Read more

Dependency Exemptions: Divorce

What is a child dependency exemption? If a separated or divorcing couple has children, an important tax decision involves assignment of the child dependency exemption. Exemptions are fixed amounts that you subtract from your adjusted gross income (AGI) to calculate taxable income. You can deduct $4,050 for each exemption you claim (for 2016 and 2017). Along with personal exemptions, you’re generally allowed one exemption for each person you can claim…  Read more

Tax Planning for the Self-Employed

Self-employment is the opportunity to be your own boss, to come and go as you please, and oh yes, to establish a lifelong bond with your accountant. If you’re self-employed, you’ll need to pay your own FICA taxes and take charge of your own retirement plan, among other things. Here are some planning tips. Understand self-employment tax and how it’s calculated As a starting point, make sure that you understand…  Read more

Crowdfunding 101: Is it Deductible?

Article by Jeff Wilson II Crowdfunding 101 Is It Deductible published on Intuit’s Tax Pro Center Crowdfunding is good for our clients who want to raise funds for a particular project, invention or venture. What makes crowdfunding so unique is that it is traditionally used to raise “material” amounts of capital that a client or organization would otherwise be required to register with the SEC, and go through costly compliance and…  Read more

Installment Sales: Tax Planning

What is it? An installment sale, sometimes used when a small business or real estate is sold, is defined as a sale of property where at least one payment is to be received after the close of the tax year in which the sale occurs. In other words, rather than receiving the proceeds at the time of the sale, you typically receive a series of payments spread out over several…  Read more

Am I Having Enough Withheld?

If you fail to estimate your federal income tax withholding properly, it may cost you in a variety of ways. If you receive an income tax refund, it essentially means that you provided the IRS with an interest-free loan during the year. By comparison, if you owe taxes when you file your return, you may have to scramble for cash at tax time–and possibly owe interest and penalties to the…  Read more

Tax Withholding as Forced Savings

What is it? You work, you receive a regular paycheck, and your employer withholds a portion of your earnings to pay federal income taxes. The amount your employer withholds is based on your filing status and number of exemptions you claimed on your W-4 form. You hate to pay taxes at the end of the year, so last year you claimed fewer exemptions than those to which you were entitled.…  Read more

Tax Consequences if Business Generates Income or Loss

What are the tax consequences if a business generates income or loss? When a business generates income or loss, the tax ramifications for the business and the business owner will depend on the type of business entity selected. Some businesses pay taxes themselves on business income, while others act as conduit or pass-through entities, making their owners responsible for paying taxes on the business income. The concept of tax basis…  Read more

Tax Planning for Business Owners

What is business tax planning? When starting a business, you must consider a number of tax-related issues. Although business tax planning is a complicated area, it is essential to understand three major topics: tax consequences when the business is formed, tax consequences when the business generates income or loss, and tax consequences of business distributions. Additionally, you may wish to consider whether your chosen form of business will offer you…  Read more

Income Splitting and Income Shifting: Tax Planning for the Self-Employed

What is income splitting? Income splitting (also known as income shifting) may be defined as dividing income in a way that lowers overall taxes. Typically, income is shifted from higher bracket taxpayers to lower ones. Although there are a number of ways to accomplish this shifting of income, family businesses provide fertile grounds for taking advantage of this tool. One method of income splitting is to hire family members to…  Read more

Tax Planning for Marriage and Divorce

What is tax planning for marriage and divorce? If you’re married or considering a divorce, you should be aware of the income tax ramifications of the financial decisions you’ll be making. Regarding marriage, you should be knowledgeable about selecting a filing status for tax purposes (and the concept of the marriage penalty). In addition, you should be aware of the concepts of innocent spouse and injured spouse relief. Finally, you…  Read more

Financial Professionals: Who’s Who

Financial Professionals: Who’s Who By IDFA on March 27, 2012  What do those letters that follow the names of financial experts mean? During your divorce, you need sound financial advice to ensure the settlement is fair to both parties; afterwards, you’ll probably need help adjusting to your new circumstances and planning for a secure future. Here’s an introduction to some of the financial professionals you may need. CPA/CA/CGA: an accountant can…  Read more

2018 Tax Season Begins January 29, 2018

January 8, 2018 – E-file Open *ONLY* for 2015 and 2016 Prior Year Business Tax Returns January 29, 2018 – Start of IRS Tax Season: First Day to Transmit Individual and Business Tax Year 2017 Returns  **Certain tax credits will delay refunds until late February** April 17, 2018 – Tax Deadline – Last Day to File Timely Without an Extension Read Full Article Here – 2018 Tax Filing Season Begins…  Read more

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