It is ordinary and necessary?

Business owners can generally deduct ordinary and necessary costs of doing business if they can prove them. One man faced a slew of issues including claims for business deductions such as rent, insurance and utilities, supported only by bank records and profit and loss statements. The IRS called these documents unreliable and insufficient. He also […]

Pension-linked emergency savings accounts

With the arrival of 2024, employers can opt to offer their employees pension-linked emergency savings accounts (PLESAs). Authorized by the SECURE 2.0 Act, these are individual accounts within a defined benefit plan, though participation in the defined benefit plan isn’t required. PLESAs are designed to encourage saving for emergencies, with a maximum balance of $2,500, […]

Beneficial Ownership reporting

New rules that require companies to report beneficial ownership information (BOI) to the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) went into effect on Jan. 1, 2024. The rules aim to promote corporation transparency, and the Treasury Department generally doesn’t expect the filing process to unduly burden businesses. According to Treasury Secretary Janet Yellen, […]

IRS issues final regulations relates to defined benefit plans

Companies that offer defined benefit plans are required to make annual contributions on behalf of covered employees. Minimum contributions must equal what is needed to provide benefits from the plan, given such factors as present value and inflation. The IRS has just issued final regulations to help calculate interest rates for the present value of […]

Taxpayer Advocate updates on IRS operations

Good news entering the 2023 tax season: The National Taxpayer Advocate, Erin Collins, has reason to be more optimistic regarding the IRS in 2024. In her Annual Report to Congress, she stated 2023 was a year of transition for the tax agency. She added: “For the first time since I began serving as the National […]

Update on Employee Retention Tax Credit

IRS Commissioner Danny Werfel updated the Senate Finance Committee on the agency’s efforts to combat fraudulent Employee Retention Tax Credit (ERTC) claims. He detailed processing changes being implemented during the claim-processing moratorium, including an effort to transcribe fields from amended paper returns to identify tough-to-find sources of ineligibility. The IRS plans to complete the digitization […]

The Tax Relief for American Families and Workers Act of 2024

The Tax Relief for American Families and Workers Act of 2024 – Wolters Kluwer https://bit.ly/42mNjEt

How secure is your tax data?

How secure is private tax data following a “historic leak of taxpayer information” over three years ago? That’s the focus of a letter sent by U.S. House Ways and Means Committee Chair Jason Smith (R-MO) to IRS Commissioner Danny Werfel. Two leaks by an IRS contractor exposed tax data of former President Donald Trump and […]

How much of my Social Security is taxable? It varies by state

How much of my Social Security is taxable? It varies by state – USA TODAY https://bit.ly/3vG3q3y

What’s the difference between a deduction and a credit?

One of the most common misunderstandings about filing an income tax return is the difference between deductions and credits. Deductions reduce the amount of a taxpayer’s income before tax is calculated. For example, on your individual return, you can either take the standard deduction or itemize deductions if it will reduce your taxable income more. […]