The chances of IRS audit are down, but you should still be prepared

| Tax Briefs

The IRS just released its audit statistics for the 2018 fiscal year, and fewer taxpayers had their returns examined as compared with prior years. However, even though a small percentage of tax returns are being chosen for audit these days, that will be little consolation if yours is one of them.   Latest statistics   Overall, just 0.59% of individual tax returns were audited in 2018, as compared with 0.62% in 2017. This was the lowest percentage of audits conducted since 2002.   However, Read more [...]

Hire your children this summer: Everyone wins

| Tax Briefs

If you’re a business owner and you hire your children (or grandchildren) this summer, you can obtain tax breaks and other nontax benefits. The kids can gain on-the-job experience, save for college and learn how to manage money. And you may be able to: Shift your high-taxed income into tax-free or low-taxed income; Realize payroll tax savings (depending on the child’s age and how your business is organized); and Enable retirement plan contributions for the children. It must be a Read more [...]

Selling your home? Consider these tax implications

| Tax Briefs

Spring and summer are the optimum seasons for selling a home. And interest rates are currently attractive, so buyers may be out in full force in your area. Freddie Mac reports that the average 30-year fixed mortgage rate was 4.14% during the week of May 2, 2019, while the 15-year mortgage rate was 3.6%. This is down 0.41 and 0.43%, respectively, from a year earlier. But before you contact a realtor to sell your home, you should review the tax considerations. Sellers can exclude some gain If Read more [...]

How entrepreneurs must treat expenses on their tax returns

| Tax Briefs

Have you recently started a new business? Or are you contemplating starting one? Launching a new venture is a hectic, exciting time. And as you know, before you even open the doors, you generally have to spend a lot of money. You may have to train workers and pay for rent, utilities, marketing and more. Entrepreneurs are often unaware that many expenses incurred by start-ups can’t be deducted right away. You should be aware that the way you handle some of your initial expenses can make a large Read more [...]

Plug in tax savings for electric vehicles

| Tax Briefs

While the number of plug-in electric vehicles (EVs) is still small compared with other cars on the road, it’s growing — especially in certain parts of the country. If you’re interested in purchasing an electric or hybrid vehicle, you may be eligible for a federal income tax credit of up to $7,500. (Depending on where you live, there may also be state tax breaks and other incentives.)   However, the federal tax credit is subject to a complex phaseout rule that may reduce or eliminate the Read more [...]