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The Thomas Howell Ferguson Blog

Many tax limits affecting businesses have increased for 2023

An array of tax-related limits that affect businesses are indexed annually, and due to high inflation, many have increased more than usual for 2023. Here are some that may be important to you and your business. Social Security tax The amount of employees’ earnings that are subject to Social Security tax is capped for 2023 […]

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Forms W-2 and 1099-NEC are due to be filed soon

With the 2023 filing season deadline drawing near, be aware that the deadline for businesses to file information returns for hired workers is even closer. By January 31, 2023, employers must file these forms: Form W-2, Wage, and Tax Statement. W-2 forms show the wages paid and taxes withheld for the year for each employee. They […]

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Employers, be wary of ERC claims that are too good to be true

The Employee Retention Credit (ERC) was a valuable tax credit that helped employers that kept workers on staff during the height of the COVID-19 pandemic. While the credit is no longer available, eligible employers that haven’t yet claimed it might still be able to do so by filing amended payroll returns for tax years 2020 […]

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Do you qualify for the QBI deduction? And can you do anything by year-end to help qualify?

If you own a business, you may wonder if you’re eligible to take the qualified business income (QBI) deduction. This is sometimes referred to as the pass-through deduction or the Section 199A deduction. The QBI deduction is: Taxpayers other than corporations may be entitled to a deduction of up to 20% of their QBI. For […]

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Is your business closing? Here are your final tax responsibilities

Businesses shut down for many reasons. Some of the reasons that businesses shutter their doors: If you’ve decided to close your business, we’re here to assist you in any way we can, including taking care of the various tax obligations that must be met. A business must file a final income tax return and some […]

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Computer Software costs: How does your business deduct them?

These days, most businesses buy or lease computer software to use in their operations. Or perhaps your business develops computer software to use in your products or services or sells or leases software to others. In any of these situations, you should be aware of the complex rules that determine the tax treatment of the […]

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Intangible Assets: How must the costs incurred be capitalized?

These days, most businesses have some intangible assets. The tax treatment of these assets can be complex. Why are intangibles complicated? IRS regulations require the capitalization of costs to: Capitalized costs can’t be deducted in the year paid or incurred. If they’re deductible at all, they must be ratably deducted over the life of the […]

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2023 Limits for businesses that have HSAs — or want to establish them

No one needs to remind business owners that the cost of employee health care benefits keeps going up. One way to provide some of these benefits is through an employer-sponsored Health Savings Account (HSA). For eligible individuals, an HSA offers a tax-advantaged way to set aside funds (or have their employers do so) to meet […]

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Providing fringe benefits to employees with no tax strings attached

Businesses can provide benefits to employees that don’t cost them much or anything at all. However, in some cases, employees may have to pay tax on the value of these benefits. Here are examples of two types of benefits that employees generally can exclude from income: A no-additional-cost benefit. This involves a service provided to […]

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2022 Q4 Tax Calendar: Key deadlines for businesses and other employers

Here are some of the key tax-related deadlines affecting businesses and other employers during the fourth quarter of 2022. Keep in mind that this list isn’t all-inclusive, so there may be additional deadlines that apply to you. Contact us to ensure you’re meeting all applicable deadlines and to learn more about the filing requirements. Note: […]

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Self-Employed? Build a Nest Egg with a Solo 401(K) Plan

Do you own a successful small business with no employees and want to set up a retirement plan? Or do you want to upgrade from a SIMPLE IRA or Simplified Employee Pension (SEP) plan? Consider a solo 401(k) if you have healthy self-employment income and want to contribute substantial amounts to a retirement nest egg. […]

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Why an LLC might be the best choice of entity for your business

The business entity you choose can affect your taxes, your personal liability, and other issues. Limited liability companies (LLC) are somewhat hybrid entities. They can be structured to resemble a corporation for owner liability purposes and a partnership for federal tax purposes. This duality may provide you with the best of both worlds. Owners of […]

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Your Business May Be Required to Report Employee Health Coverage

Certain employers are required to report information related to their employees’ health coverage. Does your business have to comply, and if so, what must be done? Basic Rules Certain employers with 50 or more full-time employees (called “applicable large employers” or ALEs) must use Forms 1094-C and 1095-C to report the information about offers of […]

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How to Treat Business Website Costs for Tax Purposes

These days, most businesses have websites. But surprisingly, the IRS hasn’t issued formal guidance on when website costs can be deducted. Fortunately, established rules that generally apply to the deductibility of business costs provide business taxpayers launching a website with some guidance as to the proper treatment of the costs. Plus, businesses can turn to […]

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Important Considerations when Engaging in a Like-Kind Exchange

A business or individual can dispose of appreciated real property without being taxed on the gain by exchanging it. You can defer tax on your gain through a “like-kind” exchange or the Internal Revenue Code Section 1031. What’s a Like-Kind Exchange? A like-kind exchange is a swap of real property held for investment or for […]

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Tax Obligations when a Business Closes its Doors

Has the ongoing pandemic put your business in a situation where you may have to close its doors? If your business closes its doors, we can assist you during this transition. A business must file a final income tax return and some other related forms for the year it closes its doors. The type of […]

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How do taxes factor into an M&A transaction?

Is your business considering an M&A transaction and wondering how it will affect your taxes? Although merger and acquisition (M&A) activity has been down in 2022, companies are still being bought and sold. It’s important to understand how the transaction will be taxed under current law. Here are some tips. Stocks vs. Assets From a […]

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Businesses Will Soon Be Able to Deduct More Under The Standard Mileage Rate

Business owners are aware that the price of gas is historically high, which has made their vehicle costs soar. The average nationwide price of a gallon of unleaded regular gas on June 17 was $5, compared with $3.08 a year earlier, according to the AAA Gas Prices website. A gallon of diesel averaged $5.78 a […]

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Is Your Corporation Eligible For The Dividends-Received Deduction?

There’s a valuable tax deduction available to a C corporation when it receives dividends. The “dividends-received deduction” has a design to reduce or eliminate an extra level of tax on dividends received by a corporation. As a result, a corporation will typically receive taxation at a lower rate on dividends than on capital gains. Ordinarily, […]

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Help When Needed: Apply The Research Credit Against Payroll Taxes

Here’s an interesting option if your small company or start-up business is planning to claim the research tax credit. You can elect to apply all or some of any research tax credits that you earn against your payroll taxes instead of your income tax. This payroll tax election may influence some businesses to undertake or […]

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