Many of the provisions included in this article are complicated, and not all the Green Book proposals have been covered. If you feel you need additional information, please give us a call. Remember, these provisions are the Biden administration’s wish list and may not be passed into law as outlined in the Green Book.
The U.S. Treasury has released the Biden administration’s 2022 Fiscal Year Budget, which includes a general explanation of the administration’s 2022 revenue proposals. The publication is commonly referred to as the Green Book and outlines the Biden administration’s tax proposals. Keep in mind that these are proposals and will have to be passed by Congress. The Green Book proposals include both domestic and international taxes; however, this article will only cover domestic tax issues that deal with individuals and small businesses. Also included in the Green Book are proposals to extend, expand or create new energy-related tax credits; we have not included any of these proposals in this article.
Congress has provided businesses with a temporary tax break as a means of helping the restaurant industry, which has been devastated by the COVID pandemic.
Although the Tax Cuts and Jobs Act eliminated the business deduction for entertainment, it continued to allow a deduction for 50% of the cost of qualified business meals.
As part of its COVID relief efforts Congress is allowing businesses to deduct 100% of business meals during 2021 and 2022, provided the meals are provided by a restaurant.
Recent guidance from the IRS (Notice 2021-25) defines the term restaurant to mean a business that prepares and sells food or beverages to retail customers for immediate consumption, regardless of whether the food or beverages are consumed on the business’s premises. However, a restaurant does not include a business that primarily sells pre-packaged food or beverages not for immediate consumption, such as a grocery store; specialty food store; beer, wine, or liquor store; drug store; convenience store; newsstand; or a vending machine or kiosk.
It is common practice for charities to hold auction events where attendees will bid upon and purchase items. The questions often arise whether (1) the money spent on the items purchased constitutes a charitable donation and (2) what kind of charitable deduction the individual who contributed the item is entitled to. If you have questions related to charitable auctions or charitable contributions in general, please give us a call.
Do you own a second home at the beach, in the mountains, or some other getaway location, or are you thinking about buying one? If so, then you may have thought about the possibility of renting it out. Though many people would never consider inviting renters into their vacation home, preferring to keep it for themselves and their family, doing so can offset some of the expenses related to the property, and you may even reap a tax benefit at the same time. Whichever route you choose to go, knowing all of the applicable tax rules regarding designated second homes helps you get the maximum financial benefit out of your asset and keeps you from making tax filing errors.
With the ever-increasing complexity of our tax system, it is commonplace for many small businesses to make mistakes with bookkeeping and filing. One way to avoid making errors is to be aware of the most commonly encountered pitfalls. Here are some tips to help keep the proper records.
Franchise investment can be a wonderful opportunity, but it also involves a completely unfamiliar set of rules when it comes to your taxes. Whether you are considering becoming a franchisee or are already involved, it’s important that you have the support of a knowledgeable tax planner to help ensure you understand your tax obligations and are preparing accordingly. Here are just a few of the things that you need to keep in mind:
If opening your credit card bills, your checkbook or your wallet are traumatic events, you may have a problem with overspending. It’s nothing to be ashamed of, and you’re certainly not alone, but there’s a good chance that it is keeping you from achieving some of your goals. If you have a dream of buying a car or a house, paying off debts, or any similar financial goal, then putting an end to overspending will help you get where you want to go — and it’s not as hard as you think it is.
Financial experts have come up with plenty of strategies to help you break your overspending habit and divert your money into where it serves you better. Some are better and easier than others, but the four that follow are among our favorites:
President Biden presented his proposed American Families Plan (AFP) during his Joint Session of Congress address on April 29, 2021. What follows is an overview of what is included in the plan. But this is only his wish list; Congress will need to draft proposed legislation that will have to pass in both the House of Representatives and the Senate before becoming law. With a price tag of more than $1.8 trillion, many on both sides of the political aisle think the plan is too expensive. As with virtually all legislation, the provisions will be debated, altered and deleted during Congressional negotiations. The final bill, if passed, may be quite different than the original proposed version.
Couples who are married on the last day of the tax year basically have two filing status options when filing their tax returns: either married filing jointly (MFJ) or married filing separately (MFS) returns. Generally, filing MFJ will produce the better tax result. However, other factors – usually personal or financial rather than tax-related – can come into play that cause taxpayers to choose to file MFS returns.
Whatever the reason for filing MFS, the consequences encountered when filing separate returns are as follows.
In this small business breakdown, we discuss important current events that are affecting small businesses across the United States in April.Why this is important for your business:
This finding has added fuel to the conversation around corporate taxation – or a lack thereof – in the US. Keep an eye on the public discourse and any moves made by politicians to speak on this topic in the coming months.