Is it ordinary and necessary, and for profit?

Business owners can generally deduct on their tax returns the ordinary and necessary costs they incur. But they must be able to prove they’re engaged in legitimate businesses to make a profit. In one case, the U.S. Tax Court ruled a taxpayer wasn’t entitled to deduct business expenses associated with writing because she wasn’t engaged […]

Sales Tax Holidays by State, 2024

Sales Tax Holidays by State, 2024 https://bit.ly/4bY5zXB

Can Name, image and Likeness collectives obtain tax-exempt status?

In recent years, many name, image and likeness (NIL) collectives have sought tax-exempt status from the IRS. These collectives are formed for the benefit of college student-athletes and solicit and provide financial support from business “boosters.” Some of the entities may qualify as tax exempt if their mission and activities can be shown to primarily […]

Lifecycle analysis is an important part of this tax credit

The IRS has released guidance for companies that want to claim a tax credit for the sequestration of carbon oxide (a greenhouse gas emission). Although the credit has been available since 2008, the Inflation Reduction Act amended it. Notice 2024-60 (https://bit.ly/3zWt6uW ) explains what information taxpayers should include in written lifecycle analysis (LCA) reports submitted […]

Record maintenance is critical to success

When it comes to running a successful small business, there are numerous tasks owners must perform. One important job is to maintain tax and financial records. Granted, this can be overlooked in the day-to-day grind of running a business, but it’s vital when it comes time to prepare and file financial statements and tax returns. […]

Are changes coming to Form 990 reporting?

Tax-exempt organizations are coming under increased scrutiny by members of the House Ways and Means Committee. Lawmakers are looking to boost transparency around tax-exempt organizations’ activities and funding mechanisms. There are also calls to revise Form 990 and proceed on legislation that limits 501(c)(3) status. Rep. David Schweikert (R-AZ) remarked at a recent meeting, “17% […]

Will my tip to the IRS provide a cash award?

Taxpayers who give the IRS Whistleblower Office (WBO) tips about unpaid taxes could qualify for cash awards. To be eligible, tips must be credible and specific, relate to tax underpayments or violations of tax laws, and be used to collect proceeds. But how is an award amount determined? One tipster received an award equal to […]

Summer Tax Planning

Summer is a good time for some tax planning that could lower your 2024 tax bill. Since the passage of the Tax Cuts and Jobs Act, which increased the standard deduction, fewer people benefit by itemizing deductions. If it’s a toss-up between taking the standard deduction and itemizing, here are some ways to increase your […]

Foreign Assets? You may be subject to FATCA

If you or your business are subject to the Foreign Account Tax Compliance Act (FATCA), you should know that enhanced security protocols went into effect July 14, 2024. Sign in or register with an IRS credential service provider (Login.gov or ID.me) and then log in to the FATCA Registration System (https://bit.ly/3WcZDnT). You’ll need to verify […]

Innocent spouse relief

“Innocent spouse” relief may protect individuals from additional tax and penalties if they’ve filed joint tax returns with spouses or ex-spouses who underreported income without their knowledge. But as a recent U.S. Tax Court case showed, such relief isn’t available in every situation. After the IRS wrongly paid a refund to a divorced couple, the […]