Payroll

It is always a struggle to get small business owners to put themselves on their own payroll.  They miserly withdraw funds to live and keep as much money in the business as possible and cover their employee’s payroll faithfully. But now we live in a situation where...

SBA Bailout for the wealthy…

I recently read an article stating that this bailout is for the wealthy, while the poor get a mere $1,200 each. I have a problem with that statement to an extent.  While it is true that “wage slaves” will only get $1,200, while the wealthy will not be getting the...

One client’s perspective on the SBA assistance

I have a client who was looking for guidance on how to tackle the SBA assistance programs PPP and EIDL for his situation. He is an independent contractor as his main source of income, and he has been sidelined with the coronavirus.  With no income coming in he is a...

How about that side hustle, now?

I have been suggesting to clients for years that they should find their passion and start a side hustle.  Even if it only nets $100 a month that can grow nicely for a cash reserve, college fund or just for retirement. Now that there are massive layoffs and the...

A Glimpse into the Future

Massive unemployment, an uncertain future along with a great deal of concern for one’s wellbeing. I believe that this is a glimpse into our future. That is once Artificial Intelligence (AI) and robotics start in earnest in filling those duties that the middle class...

Illinois does it again

At times I really believe that Illinois Department of Revenue does nothing but think of dirty tricks and schemes to play on its citizens. The most recent case has occurred to two of our clients so far this year.  In both cases the husband and wife both work for the...

Social Distancing

I agree that during these times we have to have social distancing.  But at times I think maybe we are going a bit too far.   Here is an example of my wife’s social distancing from me.  Is this too...

Non-filers

High-income individuals who haven’t or refuse to file returns are also finally getting IRS’s scrutiny.  Talk about low hanging fruit. Revenue officers will conduct in-person visits with individuals who received income in excess of $100,000 but didn’t file returns in...

More Scrutiny

Pass-through entities can expect to see more IRS audits in 2020 and more over the next few years. That’s in part because audit rates for pass-throughs have been dismally low in the recent past. The 2017 overall exam rates for partnerships and S corporations were 0.4%...

Deferred Comp

A retired Mary Kay consultant owes self-employment tax on deferred pay that she got after she retired. During her tenure with the company, she was treated as an independent contractor and was compensated with commissions. The payments that she received under the...

Late S-Corp penalties

S corporations that file late returns face a stiff fine $205 for each month late, up to a maximum of 12 months, multiplied by the number of shareholders in the firm. Prior to 2014, the penalty was a mere $195. In this case, in which a nine-owner S corporation lacked...

Payroll Tax Fraud

The IRS remains committed to combatting payroll tax fraud and has it as a high priority The Justice Department is pursuing an increasing number of civil injunctions against businesses, and their officers whom have repeatedly failed to deposit taxes withheld from...

Outsourced Payroll

Remember, if you are an employer that outsources payroll you retain all tax roll tax liability responsibilities and remain liable for unpaid taxes. So, take these steps to protect yourself if your business uses a payroll agent, enroll in the Electronic Federal Tax...

Employee Hiring Credit

An employer tax break has been extended. The work opportunity tax credit or hiring economically challenged employees will be available throughout 2020. This credit is for employers who hire qualified veterans, ex-felons, certain youth, the long-term unemployed and...

S-Corp Election

Want your calendar-year firm taxed as an S corporation for all of 2020? Then you need to file to elect S status by filing Form 2553 with IRS by March 16. The IRS has a simplified method for businesses to handle late S elections. Generally, firms have three years and...

Election Employees

This election season, many people will get part-time jobs working at the polls. This compensation is taxable, as is all earned income. But income tax withholding is not required unless the worker requests it by giving a completed W-4 to the state or municipality. FICA...

The PMI revival

Now that the deduction for private mortgage insurance premiums has officially been revived.  You can go back and claim it on my 2018 return? You will need to file an amended return on Form 1040-X and attach a 2018 updated Schedule A, which IRS is revising. The new...

The walk and talk

New research proves that conducting a meeting while walking has clear health benefits for the participants, but it turns out it benefits the meeting, too. The research from the University of Hong Kong shows that walking side by side helps people connect to each other....

The tax rates for the wealthy

I was curious of the historic tax rates for the wealthy, or at least the highest levels of taxation.  Some of the rate jumps seems arbitrary, others are simply explained by WWI and WWII.  But the jumps before our entry seem to be harbingers of our path. 1913...

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