Beware of IRS Penalties related to Form 1099-MISC that are getting larger each year

| Alerding Alerts

Form 1099-MISC is required for payments, during the ordinary course of business for services and rent paid in the amount of $600 or more, to noncorporate payees or any payments to attorneys of $600 or more. Form 1099-INT is required for interest payments of $10 or more. If you paid Alerding CPA Group $600 or more in 2019, you have at least one 1099 to file. This requirement is for all businesses, even sole proprietors, filing Schedule C or reporting rental income Schedule E. Exceptions - If you Read more [...]

4 new law changes that may affect your retirement plan

| Tax Briefs

If you save for retirement with an IRA or other plan, you’ll be interested to know that Congress recently passed a law that makes significant modifications to these accounts. The SECURE Act, which was signed into law on December 20, 2019, made these four changes. Change #1: The maximum age for making traditional IRA contributions is repealed. Before 2020, traditional IRA contributions weren’t allowed once you reached age 70½. Starting in 2020, an individual of any age can make contributions Read more [...]

Tax Provisions Extended Retroactively

| Alerding Alerts

On Friday, December 20, 2019, the President signed the Further Consolidated Appropriations Act, 2020 which extends several tax provisions related to expiring or expired tax provisions. In addition, the Secure Act, (Setting Every Community Up for Retirement Enhancement) spending package makes major changes to 401(k) plans and IRAs which mostly take effect on January 1, 2020. EXTENDERS Tax extenders are tax provisions that have already expired or were set to expire by year-end.  The Act revives Read more [...]

New law provides a variety of tax breaks to businesses and employers

| Tax Briefs

While you were celebrating the holidays, you may not have noticed that Congress passed a law with a grab bag of provisions that provide tax relief to businesses and employers. The “Further Consolidated Appropriations Act, 2020” was signed into law on December 20, 2019. It makes many changes to the tax code, including an extension (generally through 2020) of more than 30 provisions that were set to expire or already expired. Two other laws were passed as part of the law (The Taxpayer Certainty Read more [...]

Congress gives a holiday gift in the form of favorable tax provisions

| Tax Briefs

As part of a year-end budget bill, Congress just passed a package of tax provisions that will provide savings for some taxpayers. The White House has announced that President Trump will sign the Further Consolidated Appropriations Act of 2020 into law. It also includes a retirement-related law titled the Setting Every Community Up for Retirement Enhancement (SECURE) Act. Here’s a rundown of some provisions in the two laws: The age limit for making IRA contributions and taking withdrawals Read more [...]

Do you have a side gig? Make sure you understand your tax obligations

| Tax Briefs

The number of people engaged in the “gig” or sharing economy has grown in recent years, according to a 2019 IRS report. And there are tax consequences for the people who perform these jobs, such as providing car rides, renting spare bedrooms, delivering food, walking dogs or providing other services. Basically, if you receive income from one of the online platforms offering goods and services, it’s generally taxable. That’s true even if the income comes from a side job and even if you Read more [...]

Could your organization become a victim of lifestyle fraud?

| Business Miscellaneous

By Chris Mennel, CPA     Sometimes it begins with “borrowing” a small amount of money, as a temporary loan from an employer. He or she may be thinking, “I really need this money and I’ll put it back when I get my paycheck,” or “I just can’t afford to lose everything – my home, car, everything.” Or the employee is living beyond his or her means and wants to support an extravagant lifestyle. Regardless of the rationale, lifestyle fraud is very real. And small businesses and Read more [...]

Adopting a child? Bring home tax savings with your bundle of joy

| Tax Briefs

If you’re adopting a child, or you adopted one this year, there may be significant tax benefits available to offset the expenses. For 2019, adoptive parents may be able to claim a nonrefundable credit against their federal tax for up to $14,080 of “qualified adoption expenses” for each adopted child. (This amount is increasing to $14,300 for 2020.) That’s a dollar-for-dollar reduction of tax — the equivalent, for someone in the 24% marginal tax bracket, of a deduction of over $50,000. Adoptive Read more [...]

Holiday parties and gifts can help show your appreciation and provide tax breaks

| Tax Briefs

With Thanksgiving behind us, the holiday season is in full swing. At this time of year, your business may want to show its gratitude to employees and customers by giving them gifts or hosting holiday parties. It’s a good idea to understand the tax rules associated with these expenses. Are they tax deductible by your business and is the value taxable to the recipients? Customer and client gifts If you make gifts to customers and clients, the gifts are deductible up to $25 per recipient per Read more [...]

Using your 401(k) plan to save this year and next

| Tax Briefs

You can reduce taxes and save for retirement by contributing to a tax-advantaged retirement plan. If your employer offers a 401(k) or Roth 401(k) plan, contributing to it is a taxwise way to build a nest egg. If you’re not already contributing the maximum allowed, consider increasing your contribution rate between now and year-end. Because of tax-deferred compounding (tax-free in the case of Roth accounts), boosting contributions sooner rather than later can have a significant impact on the Read more [...]