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Pros and Cons of Minor Custodial Accounts
Setting up an investment account for your minor child can be a tax-efficient way of saving for college or other expenses. And one of the simplest ways to invest on your child’s behalf is to open a custodial account under the Uniform Gifts to Minors Act (UGMA) or Uniform Transfers
What types of expenses can’t be written off by your business?
If you read the Internal Revenue Code, you may be surprised to find that most business deductions aren’t specifically listed. For example, the tax law doesn’t explicitly state that you can deduct office supplies and certain other expenses. Some expenses are detailed in the tax code, but the general rule
Are Shareholder Advances Classified as Debt or Equity?
From time to time, owners of closely held businesses might need to advance their companies money to bridge a temporary downturn or provide funds for an expansion or another major purchase. How should those advances be classified under U.S. Generally Accepted Accounting Principles (GAAP)? Depending on the facts and circumstances
Offset Nursing Home Costs with Possible Tax Breaks
If you have a parent entering a nursing home, taxes are probably the last thing on your mind. But you should know that several tax breaks may be available to help offset some of the costs. Medical Expense Deductions The costs of qualified long-term care (LTC), such as nursing home
IRS Publishes Numbers for 2024
The IRS has issued numbers to help you understand what the 2024 tax situation will be like. Below is a summary. The standard deduction for married couples filing jointly for tax year 2024 rises to $29,200, an increase of $1,500 from tax year 2023. For single taxpayers and married individuals
Are scholarships tax-free?
With the rising cost of college, many families are in search of scholarships to help pay the bills. If your child is awarded a scholarship, you may wonder about how it could affect your family’s taxes. Good news: Scholarships (and fellowships) are generally tax-free for students at elementary, middle and
Wage Base for Computing Social Security Tax to Increase in 2024
The Social Security Administration recently announced that the wage base for computing Social Security tax will increase to $168,600 for 2024 (up from $160,200 for 2023). Wages and self-employment income above this threshold aren’t subject to Social Security tax. Basic Details of Employment Taxes The Federal Insurance Contributions Act (FICA)
Can you deduct 2024 bonuses this year?
You may be familiar with the rule that permits a business to deduct employee bonuses this year if it pays them within 2½ months after the end of the tax year. It’s an attractive year-end planning technique that benefits your business and your employees: You enjoy a tax deduction this
A Review of the Trust Fund Recovery Penalty
One might assume the term “trust fund recovery penalty” has something to do with estate planning. It’s important for business owners and executives to know better. In point of fact, the trust fund recovery penalty relates to payroll taxes. The IRS uses it to hold accountable “responsible persons” who willfully withhold
Why and How to Avoid Probate
Few estate planning subjects are as misunderstood as probate. But circumventing the probate process is usually a good idea, and several tools are available to help you do just that. Why should you avoid probate? Probate is a legal procedure in which a court establishes the validity of your will,