November 19, 2012 12:00 am
Published by Mark
S Corporations with Prior C Corporation E&P Because of the advantageous treatment afforded S corporation distributions, there is tremendous motivation for a C corporation with substantial E&P to convert to an S corporation prior to making a distribution, so that the distribution will be treated as a tax-free return of shareholder stock basis rather than a taxable dividend. Recognizing this potential loophole, the statute provides that a C corporation’s accumulated E&P survives the S ...
November 12, 2012 12:00 am
Published by Mark
The goal of income tax planning is to minimize your federal income tax liability. You can achieve this in different ways. Typically, though, you'd look at ways to reduce your taxable income, perhaps by deferring your income or shifting income to family members.
November 12, 2012 12:00 am
Published by Mark
Dramatic tax increases are scheduled to go into effect in 2013 make 2012 tax planning imperative. The following taxes may be impacted: · Not only are the Bush Administration tax cuts set to expire, but a new 3.8 percent surtax on investment income and a possible reinstated claw-back of itemized deductions could raise the tax rate on ordinary income to as high as an effective 44.6 percent for some taxpayers. · &nbs...
November 5, 2012 12:00 am
Published by Mark
Taxes will rise at the start of the year, Regardless of whether Congress acts during the lame duck session to extend the 2001 and 2003 tax cuts. Among these new taxes are the Affordable Care Act's 3.8 percent surtax on capital gains and dividend income and a 0.9 percent surtax on earned income for individuals earning more than $200,000 per year. There will also be a small number of taxpayers who will be affected by the alternative minimum tax for the first time—even if Congress raises the exempt...
November 5, 2012 12:00 am
Published by Mark
Each plan year a notice must be provided to all employees who are eligible to participate in the plan. This notice must be provided to employees within 30 to 90 days prior to the beginning of the plan year. If an employee becomes eligible to participate in the plan after the notice is distributed, then a notice must be provided to the employee no earlier than 90 days before and no later than the date the employee becomes eligible to participate in the plan.
November 5, 2012 12:00 am
Published by Mark
Federal Unemployment Tax Act (FUTA) Background Employers pay federal unemployment taxes on the first $7,000 of each worker’s annual wages. The FUTA tax for 2012 is a flat rate of 6.0 percent. However, businesses that pay their state unemployment taxes on time and in full can receive up to a 5.4 percent credit if the state is not subject to any credit reductions.
November 1, 2012 12:00 am
Published by Mark
Social Security Tax Would Increase by 2 Percent A temporary reduction in Social Security payroll taxes is due to expire at the end of the year and hardly anyone in Washington is pushing to extend it. The expiration of this payroll tax reduction will cost a typical worker about $1,000 a year, and two-earner family with six-figure incomes as much as $4,500. If legislation is not approved to extend the Social Security tax cut, the rate for employees would revert to 6.2 percent from 4.2 percent.
October 15, 2012 12:00 am
Published by Mark
The IRS issued guidance on situations in which employer nontaxable reimbursements were recharacterized as wages and whether they satisfied the business connection and other requirements to be treated as paid under an accountable plan under Sec. 62(c) (Rev. Rul.
October 15, 2012 12:00 am
Published by Mark
Year-end planning for 2012 is extremely challenging because we don't yet know what the tax rules will be next year. Unless Congress acts, tax rates will go up next year, many more individuals will be snared by the alternative minimum tax (AMT), and various deductions and other tax breaks will be unavailable. How Congress will resolve these issues may depend on what happens in the November elections, Year-end planning is a bigger challenge this year than in past years because, unless Congress act...
