Blogging Beyond the Numbers

The IRS announced that for 2018 tax returns already filed, the relief from the underpayment of estimated taxes would be automatically granted, even if the return as filed did not properly claim the relief. FACTS: In 2018 the withholding tables were changed due to the Tax Cuts and Jobs Act.  It was estimated that nearly 30 million taxpayers could be under withheld. To avoid an underpayment penalty...

Has your business received a “no match” letter in the past few months? Many businesses and employers nationwide have received “no-match” letters from the Social Security Administration (SSA). The purpose of these letters is to alert employers if there is a discrepancy between the agency’s files and data reported on W-2 forms, which are given to employees and filed with the IRS. Generally, a no ma...

You may have heard the term “kiddie tax” before. The “kiddie tax” rules prevent high-income taxpayers from shifting “unearned income” to their children or grandchildren in lower tax brackets. Children, in this case, refers to a child under age 19 at year-end, or under 24 years of age if they are in college and do not support more than 50% of their expenses. The term “unearned income” refers...

The “nanny tax” applies to more than just nannies.  Hiring a babysitter, gardener or another household employee (who isn’t an independent contractor) may result in a “nanny tax” tax obligation. The IRS considers you an employer for a nanny that you hired for your kids. The rationale behind treating Nanny or Caregivers as your employee is that the Individual/family who hired them has the righ...

Has your business invested in any capital assets in 2019, or are you considering adding any depreciable assets in the current year? The good news is the Section 179 depreciation deduction for business property is back for 2019 as an effective tax savings strategy. The election has long provided a tax windfall to businesses, enabling them to claim immediate deductions for qualified assets, instead of taking...

During your working days, you pay Social Security tax in the form of FICA/Medicare payroll tax withholding from your salary (or, if self-employed, is paid as self-employment tax on your 1040). Many folks are surprised that when you start receiving Social Security benefits, that some of these payments may also be taxed (hey, this seems like double taxation). Are my social security benefits taxable? If...

President Trump has signed into law the Taxpayer First Act of 2019 (H.R. 3151) (the “Act”).  Signed on July 1, 2019, this bill amends the Internal Revenue Code to improve and modify the organizational structure, enforcement procedures, and services of the Internal Revenue Service (IRS). The bill also establishes within the IRS a new “Independent” Office of Appeals to resolve tax controvers...

School is out for the summer, and you are trying to keep your kids entertained!  Did you know that day camps are eligible for a tax break? Remember when your kids were younger and in full-time daycare, you received a credit on your tax return?  This is the same credit – it’s also available for day camps!  Here are the details. The value of a credit Day camp is a qualified expense under the chi...

After the stress of busy season, we sometimes forget in the heat of the summer that there are still important tax-related deadlines that occur. Below are some of the common deadlines that hit during the heart of the summer months (3rd quarter of 2019).  Businesses can face penalties and interest if they fail to file and meet these deadlines. July 31 Form 941 for the second quarter of 2019: You ...

When you retire, two reasons for prompting the move are 1). better weather or 2). to be closer to family or loved ones.   But don’t forget to factor in how state and local taxes may help or hurt you. Once you decide on a new home state, establishing residency in that state tax may be more complicated than it initially appears to be. Consider all the state and local taxes in the “new” state ...