An offer in compromise (OIC) is an agreement between a taxpayer and the Internal Revenue Service that settles a taxpayer’s tax liabilities for less than the full amount owed. That’s the good news. The bad news is that not everyone can use this option to settle tax debt; the IRS rejected nearly 60 percent of taxpayer-requested offers in compromise. If you owe money to the IRS and wonder if an IRS offer in compromise is the answer, here’s what you need to know.
Five Things to know before Starting a Business
Starting a new business is an exciting, but busy time with so much to be done and so little time to do it in. Also, if you expect to have employees, there are a variety of federal and state forms and applications that will need to be completed to get your business up and running. That’s where a tax professional can help.
Estimated Tax Payments: The Facts
Estimated tax is the method used to pay tax on income that is not subject to withholding, including income from self-employment, interest, dividends, alimony, rent, and gains from the sale of assets, prizes, and awards. You also may have to pay estimated tax if the amount of income tax being withheld from your salary, pension, or other income is not enough.
Tips for Getting Paid on Time
For many business owners, collecting on your accounts receivables can be challenging especially as more people switch from established collection procedures to online payment methods. The good news is that you can take positive action to improve collection rates, shorten the aging days of your accounts receivable, help your business improve its cash flow and tighten up its credit and collections policies. While some of the tips discussed here may not be suitable for every business most can serve as general guidelines to give your company more financial stability.
Business Meals Fully Deductible in 2021 and 2022
Beginning January 1, 2021, and extending through December 31, 2022, businesses can claim 100% of their food or beverage expenses paid to restaurants as long as the business owner (or an employee of the business) is present when food or beverages are provided, and the expense is not lavish or extravagant under the circumstances.
What To Know About the Gig Economy and Your Taxes
The gig economy, also called sharing or access economy, is defined by activities where taxpayers earn income providing on-demand work, services, or goods. This type of work is often carried out via digital platforms such as an app or website. There are many types of sharing economy businesses, including two of the most popular ones: ride-sharing, Uber and Lyft, for example, and home rentals such as Airbnb.
Three Tips for Getting an Accurate Business Valuation
If you’re conscientious about financial reporting, you may already have a sense of your company’s worth, but in some instances, you might need a formal business valuation, such as:
- Certain transactions: Are you selling your business? Planning an IPO? Need financing?
- Tax purposes: This includes estate planning, stock option distribution, and S Corporation conversions.
- Litigation: Often needed in cases like bankruptcy, divorce, and damage determinations.
Tax Benefits of Health Savings Accounts
While similar to FSAs (Flexible Savings Plans) in that both allow pretax contributions, Health Savings Accounts or HSAs offer taxpayers several additional tax benefits. Let’s take a look:
Small Business: Tips for Ensuring Financial Success
Can you point your company in the direction of financial success, step on the gas, and then sit back and wait to arrive at your destination? Probably not.
While you may wish it was that easy, the truth is that you can’t let your business run on autopilot and expect good results. Every business owner knows you need to make numerous adjustments along the way. So, how do you handle the array of questions facing you? One way is through cost accounting.
Closing Your Business: A Tax Checklist
Many small businesses have closed due to COVID-19. If yours is one of them, you should be aware that there is more to closing a business than laying off employees, selling office furniture, and closing the doors — you must also take certain actions as required by the IRS to fulfill your tax obligations.