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The True Cost of Higher Education
The College Board reports that full-time students at in-state public schools typically paid almost $20,000 for tuition, fees, and room and board during the 2015-2016 academic year. On average, students at private institutions typically paid almost $44,000 for tuition,...
What every entrepreneur needs to know about material participation
You can only deduct losses from an S corporation, partnership or LLC if you “materially participate” in the business. Without material participation, your losses are generally “passive” and can only be used to offset income from other passive activities. Any excess...
Should you make a qualified charitable distribution from your IRA?
In 2015, a tax break valued by many charitably inclined retirees was made permanent: the qualified charitable distribution. If you are age 70½ or older, you can make direct contributions of up to $100,000 annually from your IRA to qualified charitable organizations...
Should you save for retirement or pay off credit card debt?
One question that is regularly asked by clients is whether they should invest in their company’s retirement plan or pay off high interest loans, such as credit card debt. To answer, you must evaluate your rate of return on your cash outlay. Are you giving up free...
The kiddie tax trap
It’s common for parents, grandparents and others to make gifts to minors and college students. Perhaps you want to help fund education expenses or simply remove assets from your taxable estate. Or maybe you’re hoping to shift income into a lower tax bracket. Whatever...
What to do if your business has a net operating loss
When the deductible expenses of a business exceed its income, a net operating loss (NOL) generally occurs. If you’re planning ahead or filing your income tax return after an extension request and you find that your business has a qualifying NOL, there’s some good...
Why you should not buy a business in your IRA
Business owners may need capital to support growth, and the money in their IRA can be tempting. Nevertheless, the pitfalls can be steep, as illustrated in a recent Tax Court case (Thiessen v. Commissioner, 146 T.C. No. 7 [3/29/16]). Here, the court ruled that because...
Claim a home office deduction for business use
You might be able to claim a deduction for the business use of a home office. If you qualify, you can deduct a portion of expenses, including rent or mortgage interest, depreciation, utilities, insurance, and repairs. The exact amount that can be deducted depends on...
Deduct 100% of certain meal and entertainment expenses
Many businesses host a company picnic for their employees in the summer. It’s a fun activity for your staff. But more importantly, you may be able to take a larger deduction for the cost than you would on other meal and entertainment expenses. Meal and entertainment...
Business Owners: What is your exit strategy?
Small business owners should have an exit strategy - a plan for the time when they’re either unwilling or unable to keep running their company. That plan should include both a current business continuity plan for relatively young business owners and a future long-term...
Document your meals, entertainment, auto and travel expenses
If your small business claims deductions for meals, entertainment, auto and travel expenses, be aware that the IRS may closely review them. Too often, taxpayers don’t have the necessary documentation to meet the strict requirements set forth under tax law and by the...
What’s the best entity choice for your business?
A principal consideration for any new or existing business is choosing an appropriate legal entity. Available options in most states include C corporations, S corporations, general and limited partnerships, limited liability companies (LLCs), limited liability...
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Washington, NC 27889
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