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Constructively Received Income
You are generally taxed on income that is available to you, regardless of whether it is actually in your possession. A valid check that you received or that was made available to you before the end of the tax year is considered income constructively received in that year, even if you do not cash the…
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Married Couples in Business
One of the advantages of operating your own business is hiring family members. However, the employment tax requirements for family employees may vary from those that apply to other employees. How spouses earn Social Security benefits A spouse is considered an employee if there is an employer/employee type of relationship, i.e., the first spouse substantially…
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Obtaining Answers to Tax Law Questions
In 2014, the IRS implemented a policy under which it is only answering tax-law questions during the filling season (January through mid-April). It also narrowed the scope of questions it is answering during the filing season by expanding its list of “out-of-scope” topics. The IRS justified these restrictions as a cost-saving step. The National Taxpayer…
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Requirements to Claim the Home Office Deduction
Regardless of the method chosen, there are two basic requirements for your home to qualify as a deduction: Regular and exclusive use. Principal place of your business. Regular and Exclusive Use You must regularly use part of your home exclusively for conducting business. For example, if you use an extra room to run your business,…
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Home Office Deduction
Simplified Option For taxable years starting on, or after, January 1, 2013 (filed beginning in 2014), you now have a simplified option for computing the home office deduction (IRS Revenue Procedure 2013-13, January 15, 2013). The standard method has some calculation, allocation, and substantiation requirements that are complex and burdensome for small business owners. This…
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Self-Employment Tax
Self-employment tax (SE tax) is a social security and Medicare tax primarily for individuals who work for themselves. Your payments of SE tax contribute to your coverage under the social security system. Social security coverage provides you with retirement benefits, disability benefits, survivor benefits, and hospital insurance (Medicare) benefits. Generally, you must pay SE tax and…
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It’s March!
When will I get my Alabama Tax Refund? The Alabama Department of Revenue will not start approving refunds until March 1st of each year. That’s today! The speed in which you receive your refund depends on several things. For a faster refund you should both file your return early and file your return electronically. To…
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Business Taxes
The form of business you operate determines what taxes you must pay and how you pay them. The following are the five general types of business taxes. Income Tax Estimated Taxes Self-Employment Tax Employment Taxes Excise Tax
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IRS waives estimated tax penalty for farmers, fishermen who file returns and pay tax by April 15
The Internal Revenue Service will waive the estimated tax penalty for any qualifying farmer or fisherman who files his or her 2018 federal income tax return and pays any tax due by Monday, April 15, 2019. The deadline is Wednesday, April 17, 2019, for taxpayers residing in Maine or Massachusetts. The IRS is providing this…
