Take Advantage of Tax Breaks Now!
Once again, this year is similar to the last few years when it comes to year-end tax planning due to the uncertainty over whether Congress will extend any of the many expired or expiring tax provisions. However, this is not a reason to wait as tax savings can still be realized by taking advantage of tax breaks that are still on the books for 2015. The following tax breaks apply to both individuals and small businesses:
In 2014, Benjamin Miller from Indiana posted a tweet that included a picture of notice he received from the IRS indicating that he owes a penalty of $2,344 because he didn’t have health insurance. Needless to say, his tweet went viral and ignited a firestorm.
If you’re thinking about retiring or leaving your current employer, you would be required to take a distribution from your employer’s retirement plan. Depending upon the terms of the plan as well as your age, a distribution may not be required immediately. However, it is important that when you do have to take the distribution that you are aware of a potential number of tax pitfalls that you might incur.
No doubt you’ve attended charity functions that have auction events where you can bid upon and purchase items. If so, questions often arise as to whether the money you spent on the items purchased would be considered as a charitable donation.
Did you file a tax extension for your 2014 tax return? Remember, this one and only tax extension will expire on October 15, 2015. If you don’t file before this date, you are subject to late filing penalties so please contact our office so we can assist in meeting this filing deadline.
If you are an owner of a small business it is extremely important for you to be aware of your company’s financial status and the best way to do that is to have an accurate balance sheet. If this information is kept up to date on a quarterly basis, the balance sheet will help you avoid future surprises. It’s simple accounting – assets must be balanced by and equal to the liabilities plus the owner or shareholder’s equity.
It’s that time again – September 15, 2015, is the extended due date for filing those returns.
Pass-through entities such as Partnerships, S-corporations, and fiduciaries (trusts, estates) pass their income, deductions, credits, etc., through to their investors, partners, or beneficiaries, who in turn report the various items on their individual tax returns. Partnerships file Form 1065, S-corps file Form 1120-S, and Fiduciaries file Form 1041, with each partner, shareholder, or beneficiary receiving a Schedule K-1 from the entity that shows their share of the reportable items.
Normally, Social Security benefits that you receive are not taxable. However, that will depend on your total income – the higher the income, the more taxes you’ll have to pay on your benefits.
When The Defense of Marriage Act of 1996 (DOMA) was overturned this past June, legally married same-sex couples are now required to file their federal returns and state results as “married” since all states are now required to recognize and allow same-sex marriage.
Keep in mind, however, that being married for tax purposes is not always beneficial, depending on a number of circumstances.
Did you forget about a deductible expense on your tax return or an expense that would qualify for a tax credit? Did you receive an unexpected or amended K-1 from a partnership, S-corp, trust or estate?
These are just a few examples of overlooked income or deductions that you may have forgotten on your tax return whether it was for the 2014 return or even prior year returns.
If you are considering whether to file an amended return (Form 1040X) or even a state income tax return, we recommend reviewing the following points:
