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Out-of-pocket medical expenses may be deductible if they exceed 10% of your adjusted gross income. By “bunching” nonurgent medical expenses into alternating years, you may be able to exceed the floor. The “Unified Framework for Fixing Our Broken Tax Code” President Trump and congressional Republicans released on Sept. 27 proposes, among other things, increasing the […]

If you own an unincorporated business with your spouse, you may face high self-employment (SE) taxes. An unincorporated business in which both spouses are active is typically treated by the IRS as a partnership owned 50/50 by the spouses. For 2017, that means you’ll each pay the maximum 15.3% SE tax rate on the first […]

If you’ve cashed in some big gains this year, consider looking for unrealized losses in your portfolio and selling those investments before year end to offset your gains. This can reduce your 2017 tax liability. But beware of the wash sale rule. It prevents you from taking a loss on a security if you buy […]

A Health Savings Account (HSA) is a tax-advantaged way to both pay for health care costs and pursue your estate planning goals. HSAs, which must be paired with a high-deductible health plan, allow pretax contributions and tax-free withdrawals for qualified medical expenses. Unused HSA balances can supplement retirement income or continue growing on a tax-deferred […]

Income from endowment funds may be able to help your nonprofit meet operating expenses, ease cash-flow problems and supplement your annual budget. But you need to control your spending policy. Assuming funds aren’t restricted, nonprofits in most states must conform to provisions of the Uniform Prudent Management of Institutional Funds Act. Within those constraints, define […]

If business-travel expenses are properly accounted for, reimbursements are generally tax-free to the employee and deductible by the employer. But keeping track of actual costs can be a headache. With per diem rates, employees don’t have to keep receipts; they just document the travel’s time, place and business purpose. The employer simply pays the employee […]

If you’re not making the maximum 401(k) contribution allowed ($18,000, or, if age 50 or older, $24,000), consider increasing your contribution rate through year end. Traditional 401(k) contributions are pretax, plan assets can grow tax-deferred (you pay no income tax until you take distributions), and your employer may match some or all of your contributions […]

To improve the odds of a successful acquisition, it’s important to devote resources to tax planning before your deal closes. For example, discuss whether and how much each party can deduct their transaction costs and how much in local, state and federal tax obligations the parties will owe upon signing the deal. And if you […]

Charitable giving is a key part of estate planning for many people. If you’re making gifts during life, generally, it’s advantageous to donate appreciated property to avoid capital gains tax. Because the top capital gains rate for art is 28%, donating art can be particularly effective. Be sure to have art appraised by a “qualified” […]

A reverse audit can help your business find sales and use tax overpayments so you can seek refunds. States may exempt, for example, equipment and utilities used in manufacturing, and custom software, computers and peripherals used for research and development. Unless you’re diligent, you may be missing out on some exemptions to which you’re entitled. […]

If your business is a limited liability company (LLC) or a limited liability partnership (LLP), you know that these structures offer liability protection and flexibility as well as tax advantages. But they once also had a significant tax disadvantage: The IRS used to treat all LLC and LLP owners as limited partners for purposes of […]

Here are a few key tax-related deadlines for businesses and other employers during Quarter 4 of 2017. OCT. 16: If calendar-year C corp. that filed an extension, file a 2016 income tax return. OCT. 31: Report income tax withholding and FICA taxes for Q3 2017 (unless eligible for exception). DEC. 15: If calendar-year C corp., pay fourth installment […]

Many not-for-profits join forces to better serve their clients and cut costs. But even a simple collaborative arrangement can involve complex financial reporting obligations. Costs incurred and revenues generated from transactions with third parties should be reported, on a gross basis on the statement of activities, by the nonprofit that’s considered the “principal” for that […]

If you expect your estate to have a significant estate tax liability at your death and you want to avoid unintended consequences, be sure to include a well-drafted tax apportionment clause in your will or revocable trust. This clause specifies how the estate tax burden will be allocated among beneficiaries. One apportionment option is to […]

Despite a generous $5.49 million generation-skipping transfer (GST) tax exemption, complexities surrounding its allocation can create tax traps. The GST tax is a flat, 40% tax on transfers to “skip persons,” such as family members more than a generation below you. To take full advantage of the GST tax exemption, you (or your estate’s representative) must […]

An employee stock ownership plan (ESOP) is a qualified retirement plan that invests in the business’s own stock and offers valuable tax benefits. The business’s contributions are typically tax-deductible. Dividends paid on ESOP stock passed through to employees or used to repay an ESOP loan, and dividends voluntarily reinvested by employees in company stock in […]

Could a captive insurance company reduce health care costs and save your business taxes? A captive generally is wholly owned and controlled by the employer, like forming your own insurance company. You can customize coverage and charge premiums that more accurately reflect your loss exposure. And you can participate in the captive’s underwriting profits and […]

The IRA’s value as a retirement planning tool is well known. But if you don’t need an IRA to fund your retirement, you can use it as an estate planning tool to benefit your children or other beneficiaries on a tax-advantaged basis by turning it into a “stretch” IRA. It’s simply a matter of designating […]

Cash flow statement reporting is a leading cause of financial restatements. Recently updated FASB guidance clarifies whether certain issues should be classified under cash flows from operating, financing or investing activities … or as a combination of these options. For calendar-year public companies, the amendments go into effect in 2018. Private companies get an extra […]

If your estate plan includes a revocable trust (also known as a “living trust”), it’s critical to ensure that the trust is properly funded. Revocable trusts offer significant benefits, including asset management (in the event you become incapacitated) and probate avoidance. But these benefits aren’t available if you don’t fund the trust. To do so, […]