Business Information for Sole-Proprietors

Information for Sole-Proprietors What is a Business A trade or business is generally an activity carried on to make a profit. The facts and circumstances of each case determine whether or not an activity is a trade or business. You do not need to actually make a profit to be in a trade or business … Continue reading

Summary of the American Taxpayer Relief Act

The following information was fresh just this morning (January 2, 2013), I have highlighted the specific provisions that I believe will affect a significant number of my clients. If you have any questions about how these items may affect you specifically, please don’t hesitate to call. ―CH Individual tax rates: The marginal rates under the … Continue reading

2012 Year-End Tax Planning-Personal Tax Considerations

2012 began with great uncertainty over federal tax policy and now, with the end of the year approaching, that uncertainty appears to be far from any long-term resolution. A host of reduced tax rates, credits, deductions, and other incentives (collectively called the “Bush-era” tax cuts) are scheduled to expire after December 31, 2012. To further … Continue reading

The 3.8% Medicare Tax on Investment Income

The health care reform package (the Patient Protection and Affordable Care Act and the Health Care and education Reconciliation Act of 2010) imposes a new 3.8 percent Medicare contribution tax on the investment income of higher-income individuals. Although the tax does not take effect until 2013, it is not too soon to examine methods to … Continue reading

Foreign Account Reporting

Taxpayers have long been required by the Bank Secrecy Act to report certain foreign accounts. Now, there is a new reporting requirement in the Foreign Account Tax Compliance Act of 2010. The Foreign Account Tax Compliance Act (FATCA), enacted in 2010, requires certain U.S. taxpayers to report their interests in specified foreign financial assets. The … Continue reading

Heroes Act: Incentives to Hire Military Veterans

The Three Percent Withholding Repeal and Job Creation Act (2011 Heroes Act) expands tax incentives that encourage employers to hire military veterans. The 2011 Heroes Act enhances the Work Opportunity Tax Credit (WOTC) by creating the Returning Heroes Tax Credit and the Wounded Warriors Tax Credit. In general, the WOTC rewards employers with a tax … Continue reading

Using Trusts – Meeting Tax and Non-Tax Goals

Trusts have been used as integral parts of sophisticated tax and financial arrangements for centuries. Exactly how they are used, however, depends on a person’s particular goals, currently applicable tax rules, and other factors. We hope this post will give you a bit of general information about the current use of trusts to familiarize you … Continue reading

Out-of-Pocket Expenses as a Volunteer for Charities

Out-of-Pocket Expenses as a Volunteer for Charities

A recent Tax Court case serves as a reminder that the IRS and the courts require strict compliance with the documentation rules for charitable donations. The taxpayer in this case had spent substantial sums as a volunteer in support of a charitable organization. Because she did not obtain proper acknowledgement from the charitable organization, however, … Continue reading