Here’s a tax strategy that you should seriously consider. When a business provides an employee or a partner with a smartphone or similar telecommunications equipment primarily for non-compensatory business reasons, the following great things happen: The employee’s or partner’s business use is a working condition fringe benefit that is excludable from income. The employee’s or […]
You have to love the seven-day travel rule. First, the seven-day travel rule is crystal clear. Second, the seven-day travel rule allows you to deduct 100 percent of the transportation cost to a business destination even when you work only one day and spend the rest of the time at the beach or on the […]
Estimated tax tip savings: When you convert your vacation into a business trip, your transportation expenses suddenly become deductible. Consider that $1,200 business-class plane ticket back home to see your parents—with the right tax planning, you can deduct 100 percent of the cost. Isn’t it about time you took a vacation? Maybe you don’t think […]
You can reap major tax savings with the heavy vehicle and home-office combo. The heavy vehicle produces quick deductions. The home office that qualifies as a principal office eliminates commuting miles, and such an elimination can dramatically increase your business-use percentage of vehicles. For example, say you bought a $50,000 vehicle that you use 60 […]
Under the de minimis fringe benefit rules, your business deducts the cost of giving you or your employees flowers, fruit, books, and similar property under special circumstances. The recipients—you or your employees—receive these fringe benefits tax-free.
Situation Eddie Fiss works 40 hours a week at his small downtown office that he owns. He also spends 12 hours a week working at home doing all the administrative tasks required for his consulting business. Questions Can Eddie claim tax deductions for any of these? A. His downtown office only B. His home office […]
If you are a sole proprietor, you know that the 15.3 percent self-employment tax can eat up your profits in a hurry. You may be able to use a simple strategy to ease this tax burden. If you own an office building or other assets, you can set up a rental arrangement with your spouse […]
Estimated tax tip savings. Pay your child $8,000, for example, to work in your LLC or sole proprietorship and you could save $3,042. Your exact savings will vary depending on your tax bracket and several other factors. Children are expensive. The IRS has a solution to this problem: Put your children to work in your […]
The Affordable Care Act (ACA) does not apply to a business that has only one employee. This opens the door (likely regardless of what lawmakers do with the ACA) for what we are going to call the 105-HRA. We created this name from its two predecessors: The Section 105 medical reimbursement plan The health reimbursement […]