Generally, when Lake Wylie Tax Service assists with completing your Tax Return, we determine your “Filing Status” for you. However, we thought this article might be beneficial….
Filing status is determined on the last day of the year and most often is based on marital status. The two most prevalent are as follows in this week’s article.
Continue reading →
Raising money through Internet crowdfunding sites prompts questions about the taxability of the money raised. A number of sites host money-raising projects for fees generally ranging from 5 to 9%, including GoFundMe, Kickstarter, and Indiegogo. Each site specifies its own charges, limitations, and withdrawal processes. The money raised may or may not be taxable depending what the purpose of the fundraising campaign was.
As tax time approaches, here are some tax issues that taxpayers frequently overlook, ranging from obscure deductions to overlooked tax credits and benefits. Of course, not everything can be included since the tax law has grown significantly in complexity, and it would take a thick book to list everything. But besides what you are probably accustomed to, here are over 20 issues you may not be aware of and that can save you tax dollars.
President Biden released his “American Rescue Plan” on January 14. It is a wish list of proposals he wants Congress to enact to address the COVID-19 pandemic and associated economic crisis. While some of the proposals are intended to be in effect for just one year, it isn’t too great a stretch of the imagination that these could later be extended or made permanent, as many of them have been on the Democrats’ agenda for some time. The anticipated cost of the American Rescue Plan, if all of the proposals are agreed to by Congress, is $1.9 trillion. None of Biden’s proposals are revenue raisers, and according to a January 15, 2021 Wall Street Journal report, he intends to use government borrowing to pay for his plan. Following are some of the tax-related proposals.
Advance planning can, in many cases, minimize or even avoid taxes on IRA distributions and other qualified plan distributions. When contemplating future retirement and when to begin tapping taxable IRA and other qualified retirement accounts, taxpayers need to consider a number of important issues.
It seems hard to believe, but the holiday season is upon us, and that means that the 2020 tax preparation season will soon follow. With the end of the tax year just weeks away, it may be appropriate (especially this year, in light of the financial havoc created by COVID-19) to review some year-end tax issues that might reduce your tax bite for 2020 or provide long-term tax benefits.
The holiday season is customarily a time of giving gifts, whether to your favorite charity, family members or others. Some gifts even provide a variety of tax benefits.
But be wary; during the holiday season, you may receive phone calls, emails, snail mail, or appeals on social networking sites for donations for various causes. However, some of these appeals may come from fraudsters and not legitimate charities. Unfortunately, this happens every holiday season.
So, before writing a check or giving your credit card number to a charity that you aren’t familiar with, check them out so you can be assured that your donation will end up in the right hands. Follow these tips to make sure that your charitable contributions will actually go to the cause you are supporting:
Continue reading →
If you are a small business owner, every penny of your income counts. This means that you not only want to optimize your revenue, but also minimize your expenses and your tax liability. Unfortunately, far too many entrepreneurs are not well-versed on the tricks and tools available to them and end up paying far more than they need to.
Though all of these strategies can be helpful, they may not all be appropriate for your situation. Keep them in mind as you go into the end of the year and be prepared to ask questions to determine which apply to you when you speak with our office. Contact us to discuss tax planning for your business today. Here are a few of our favorites.
In spite of COVID-19 restrictions many entrepreneurs are considering possible new or additional business opportunities. So, if you are planning a new business start-up and are incurring some expenses, you probably anticipate deducting those expenses in the first year of the business’s operation. Unfortunately, it is a little more complicated than that. Expenses a business incurs in the beginning can include equipment purchases, vehicle purchases and use, leasehold improvements, organizational costs and start-up expenses, and each receives a different tax treatment.
Even before you begin incurring expenses for equipment, leases and the like, you must decide what type of business entity you are going to establish. The type of business entity you choose will determine which tax form has to be filed. The most common types of business entities are the sole proprietorship, partnership, corporation, and S corporation, some of which may also be structured as a limited liability company. The choice of entity will affect the tax outcome of your business for years to come.
Continue reading →
The IRS has warned taxpayers of a clever scheme by internet scammers to dupe tax-payers into revealing their bank account information under the guise of receiving the $1,200 Economic Impact Payment (EIP) that Congress authorized last Spring.
Criminals are relentlessly using COVID-19 and Economic Impact Payments as cover to try to trick taxpayers out of their money or identities. This new scam is a twist on those the IRS has been seeing much of this year, and the IRS urges people to remain alert to these types of scams.
The current scam is a text message that reads: “You have received a direct deposit of $1,200 from COVID-19 TREAS FUND. Further action is required to accept this payment into your account. Continue here to accept this payment …” The text includes a link to a fake phishing web address.
Continue reading →