Tax Tips

Tax Tips for Start-Up Business Owners

Almost everyone is familiar with paying personal income taxes, but taxes for businesses are unfamiliar territory for most people. Understanding your tax responsibilities and learning what you can do to avoid over-payment is a challenge to handle alone, but with advice from a CPA firm that has experience with helping start-up companies succeed, you ensure your business is financially sound and fully compliant from the outset. A local Long Island accountant can help brick and mortar or online businesses meet their tax obligations.

Know Your Business Type

What kind of business are you establishing? Tax laws treat sole proprietorships, corporations, S-corporations, partnerships, and self-employment as different entities. You will fill out different tax forms for each of them, and your choices here have a significant impact on your tax responsibilities. You will always need to pay an income tax, but self-employment taxes, sales taxes, and payroll taxes may also factor into your tax plan. At this stage, a CPA’s financial advice is invaluable. Choosing a local firm is also wise; a Long Island CPA, for example, can advise you not only on federal tax laws but also state and local tax expectations you must meet. Continue reading

Tax Tips for Telecommuters

Whether you hire telecommuting personnel or are a long-distance worker yourself, you’ve probably already encountered one of the coming decade’s biggest tax challenges. Until recently, people who lived in one state and worked in another were relatively rare, and most of them commuted just a few miles across state lines. Today, a web designer who’s based in Florida might work for a firm in New York. Which state gets that person’s tax dollars? How do accounting firms handle withholding? Can telecommuters avoid paying double the state tax?

Turning telecommuting tax troubles over to your CPA firm is the ideal way to ensure full compliance while keeping your personnel from paying too much. These scenarios tell you more about your telecommuting workers’ specific status and what it means for your business. Continue reading

Updating Your W-4

For most employees, the annual April tax deadline is the only significant one. Self-employed people, independent contractors and employers have additional accounting deadlines that are equally important. As the calendar year draws to a close, employers must collect updated W-4 forms from their personnel. In many states, an equivalent form is also necessary. In some cases, these new forms are straightforward, but for others, simple paperwork is anything but. A Certified Public Accountant can help tame the tangle of red tape and let business owners and their employees focus on their work, not their tax status.

A W-4 form lets the Internal Revenue Service know about the individual’s filing status, including dependent exemptions, so it’s vital to keep these records updated to ensure accurate withholding. While the form itself is short, it may not always tell the full story, and simple calculations may not be appropriate for every employee. A conventional W-4 form cannot take into account all available deductions, credits and adjustments. If a form contains errors, straightening them out later can be even more of a challenge. Continue reading

Back-to-School Tax Advice

Education expenses have risen geometrically since the turn of the century. To manage these expenses and preserve more of their income and savings, families are turning to their CPAs for tax advice on managing hefty tuitions or school loans. Here are some key tax tips to help you keep more of your money and stay on the right side of the Internal Revenue Service.

Know Your Deductibles

The list of education-related tax deductibles is long and varied enough to puzzle anyone who is less than familiar with tax law. For example, transportation costs may be deductible, but school uniforms are not – even when your child’s school requires them. Private school tuition is also not deductible, a fact that many people who prepare their own taxes may not know. Families with children under the age of 13 or at the college level have special restrictions and additional deductibles, so your tax status could change as children progress through their academic careers.

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The Top Tax Issues Small Businesses Face for 2014

After a year that included a governmental shutdown, preparation for sweeping changes to healthcare and a possible introduction of online sales tax, small businesses must pay close attention to what 2014 will bring. With financial guidance from your CPA firm, you can weather the upcoming tax changes with relative ease, but understanding the changes can also help you make informed decisions.

Individual Insurance Requirements and Exemptions

Under the Affordable Care Act (ACA), most people must buy healthcare insurance that meets or exceeds the new federal minimum standards. Although the law provides for some exceptions, people who have no insurance either through the Healthcare Marketplace or an employer could face penalties in 2014. Conversely, you may be eligible for tax deductions on your healthcare expenses even if you retain your current type and level of insurance. If you are self-employed, the thicket of new requirements, exemptions and deductions can be dense; your accountant can help you make your way through it. Continue reading

3 Tax Changes You Need To Know About In 2014

With the looming fiscal cliff at the beginning of 2013 and the mid-year calls for tax reform, this year has been unusually tempestuous for taxpayers. While changes to next year’s tax laws are far from a certainty, financial experts are already looking at ways to prepare their clients’ business and personal tax returns in 2014. Here are a few of the most likely changes and how to prepare for them before they become pressing concerns in April. Continue reading

Are You Ready for Tax Increases?

The fiscal cliff and “Taxmageddon” have been hot topics for financial analysts and CPA firms, but figuring out what it means for you and your personal or business finances can be a challenge. Due to a number of tax cuts and exemptions that expired or are due to expire in early 2013, many individuals and businesses will be scrambling to find ways to avoid a major tax increase this year. You may have already noticed a reduction in your take-home pay; that’s thanks to a 2 percent tax cut on payroll tax that expired on January 1. These changes are only the first step off the fiscal cliff, though, and more tax breaks are slated to be phased out in coming years.

Understanding the changing tax landscape and maintaining compliance while protecting your financial assets may take additional expertise and quick action throughout the year to ensure a less painful tax season in 2014. Take these steps today and create a parachute to carry you safely over future fiscal cliffs. Continue reading

Choosing Your Tax Preparer

It isn’t just your imagination; tax returns are becoming more complex. This year, personal and business taxes are likely to be even more of a challenge for those who file their own returns because Congress waited longer than usual to finalize income tax laws for 2012. More people are turning to professional tax preparers this year to ensure compliance and make returns easier, but it’s important to find tax preparation services that suit your needs.

For those with single income sources, no dependents and otherwise simple returns, the standard 1040EZ could work for you. However, this form is designed for those with extremely straightforward tax returns that include no significant assets or property, no international income sources, no available deductions and amount to under $100,000 in annual income. Anyone who is not eligible to file a 1040EZ can benefit from hiring a tax preparation service. Continue reading