You may be able to deduct qualified education expenses paid during the year for yourself, your spouse or your dependent. You cannot claim this deduction if your filing status is married filing separately or if another person can claim an exemption for you as a...
Over the years, there has been confusion regarding Single Member Limited Liability Companies (SMLLCs) in general and specifically, how they can report and pay employment taxes. An LLC is a new entity created by state statute. The IRS did not create a new tax classification for...
In forming a corporation, prospective shareholders exchange money, property, or both, for the corporation's capital stock. A corporation generally takes the same deductions as a sole proprietorship to figure its taxable income. A corporation can also take special deductions. For federal income tax purposes, a...
S corporations are corporations that elect to pass corporate income, losses, deductions and credit through to their shareholders for federal tax purposes. Shareholders of S corporations report the flow-through of income and losses on their personal tax returns and are assessed tax at their individual...
S Corporation Shareholders are Required to Compute Both Stock and Debt Basis The amount of a shareholder’s stock and debt basis is very important. Unlike a C corporation, each year the stock and/or debt basis of an S corporation goes up and/or down based upon the...
Employers must withhold Social Security and income taxes from employee paychecks. Conversely, independent contractors are responsible for reporting and paying their own Social Security and income taxes. Businesses use several factors to determine how to classify its workers, including the degree of control the business has...
It is critical that you, the employer, correctly determine whether the individuals providing services are employees or independent contractors. Generally, you must withhold income taxes, withhold and pay Social Security and Medicare taxes, and pay unemployment tax on wages paid to an employee. You do...
With regard to medical expenses, long-term care expenses are deductible if an individual is a chronically ill individual under the cognitive impairment trigger and are provided pursuant to a plan of care prescribed by a licensed health care practitioner. In Notice 97-31, 1997-1 CB 417, the...
Biofuels have been embraced by supporters from President George W. Bush to the Natural Resources Defense Council. Before 1930, the U.S. Treasury focused on shutting down small alcohol producers. After 1978, U.S. energy policy sought to encourage ethanol production to reduce dependence on foreign oil....
Regarding help for victims of Ponzi schemes, The IRS provides two items of guidance to help taxpayers who are victims of losses from Ponzi-type investment schemes. Revenue Ruling 2009-9 provides guidance on determining the amount and timing of losses from these schemes, which is difficult and...