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The Thomas Howell Ferguson Blog

Education assistance benefits help attract, retain, and motivate your employees

Did you know your business can attract or retain employees by offering education assistance benefits? One popular fringe benefit is an education assistance program that allows employees to continue learning and perhaps earn a degree with financial assistance from their employers. One way to attract, retain and motivate employees is to provide education fringe benefits […]

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Protect the “ordinary and necessary” advertising expenses of your business

Is advertising a business expense? Does your company use advertising as a means to gain business? If so, you may be able to cut advertising taxes. Under tax law, businesses can generally deduct advertising and marketing expenses that help keep existing customers and bring in new ones. This valuable tax deduction can help businesses cut […]

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The tax advantages of hiring your child this summer

There are tax advantages of hiring your child(ren) for work during the summer. Learn how! Summer is around the corner, so you may be thinking about hiring young people at your small business. At the same time, you may have children looking to earn extra spending money. You can save family income and payroll taxes […]

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2023 Q2 Tax calendar: Key deadlines for businesses and employers

Here are some of the key tax-related deadlines that apply to businesses and other employers during the second quarter of 2023. 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 […]

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Buying a new business vehicle? A heavy SUV is a tax-smart choice

Have you considered purchasing a business vehicle? Rather than getting a small car, a heavy SUV may be ideal to receive tax benefits on a business vehicle. Be mindful that a heavy SUV may provide a more generous tax break this year than you’d get from a smaller vehicle. The reason has to do with […]

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Do you run a business from home? You may be able to deduct home office expenses

You may be able to deduct home office expenses if you run a business from home. Learn more here. Many people began working from home during the COVID-19 pandemic — and many still run a business from home offices either all the time or on a hybrid basis. If you’re self-employed and run a business […]

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Key tax issues in M&A transactions

Merger and acquisition (M&A) transactions activity dropped dramatically last year due to rising interest rates and a slowing economy. The total value of M&A transactions in North America in 2022 was down 41.4% from 2021, according to S&P Global Market Intelligence. But some analysts expect 2023 to see increased M&A activity in certain industries. If […]

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Have employees who receive tips? Here are the tax implications

Many businesses in certain industries have employees who receive tips as part of their compensation. These businesses include restaurants, hotels, and salons. Tip definition Tips are optional payments that customers make to employees who perform services. For employees who receive tips, those can be cash or noncash. Cash tips include those received directly from customers, […]

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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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Employers: In 2023, the Social Security wage base is going up

The Social Security Administration recently announced that the wage base for computing Social Security tax would increase to $160,200 for 2023 (up from $147,000 for 2022). Wages and self-employment income above this threshold aren’t subject to Social Security tax. Basics about Social Security The Federal Insurance Contributions Act (FICA) imposes two taxes on employers, employees, […]

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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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2023 Q1 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 first quarter of 2023. Keep in mind that this list isn’t all-inclusive, so there may be additional deadlines that apply to you. If you have questions about filing requirements, contact us. We can ensure you’re meeting all applicable deadlines. January […]

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Choosing a business entity? Here are the pros and cons of a C corporation

If you’re launching a new business venture, you’re probably wondering which form of business is most suitable. Here is a summary of the major advantages and disadvantages of doing business as a C corporation. A C corporation allows the business to be treated and taxed as a separate entity from you as the principal owner. A […]

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How to minimize the S corporation LIFO recapture tax

If you’re considering converting your C corporation to an S corporation, be aware that there may be tax implications if you’ve been using the last in, first out (LIFO) inventory method. That’s because of the LIFO recapture income that will be triggered by converting to S corporation status. We can meet to compute what the […]

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The standard business mileage rate is going up in 2023

Although the national price of gas is a bit lower than it was a year ago, the optional standard mileage rate used to calculate the deductible cost of operating an automobile for business will be going up in 2023. The IRS recently announced that the 2023 cents-per-mile rate for the business use of a car, […]

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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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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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Inflation means you and your employees can save more for retirement in 2023

How much can you and your employees contribute to your 401(k)s next year — or other retirement plans? In Notice 2022-55, the IRS recently announced cost-of-living adjustments that apply to the dollar limitations for pensions, as well as other qualified retirement plans for 2023. The amounts increased more than they have in recent years due […]

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What local transportation costs can your business deduct?

You and your small business are likely to incur a variety of local transportation costs each year. There are various tax implications for these expenses. First, what is “local transportation?” It refers to travel in which you aren’t away from your tax home (the city or general area in which your main place of business […]

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ICYMI: Understanding Business Financials for Future Success, a presentation by THF Shareholder, Dennis Gallant, CPA

Shareholder, Dennis Gallant, CPA presented a discussion on understanding business financials to members of the Bainbridge-Decatur Chamber of Commerce in Bainbridge, Georgia. He explained in detail the basic principles that business owners should know, such as reviewing balance sheets and understanding assets, knowing a business’ income statement, determining if the business made a profit or […]

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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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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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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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2022 Q3 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 third 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. August […]

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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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Florida Businesses: New Requirement to Submit New Hire Information for Independent Contractors

A new requirement to submit new hire information for independent contractors has been passed in the State of Florida. Now, businesses must submit new hire information for their independent contractors to the Florida Department of Revenue. This is a significant change for businesses as previously reporting of independent contractors by a business was optional. Background […]

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Can You Deduct the Costs of a Spouse on a Business Trip?

If you own your own company and travel for business, you may wonder whether you can deduct the costs of having your spouse accompany you on trips. The rules for deducting a spouse’s travel costs are very restrictive. First of all, to qualify, your spouse must be your employee. This means you can’t deduct the […]

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Entrepreneurs and Taxes: How Expenses are Claimed on Tax Returns

It is difficult to determine which expenses to claim on tax returns. While some businesses have closed since the start of the COVID-19 crisis, many new ventures have launched. Entrepreneurs have cited a number of reasons why they decided to start a business in the midst of a pandemic. For example, they have more time, […]

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Numerous Tax Limits Affecting Businesses have Increased for 2022

Many tax limits that affect businesses are annually indexed for inflation, and a number of them have increased for 2022. Here’s a rundown of those that may be important to you and your business. Social Security Tax The amount of an employee’s earnings that are subject to Social Security tax is capped for 2022 at […]

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Businesses with Employees Who Receive Tips may be Eligible for a Tax Credit

If you’re an employer with a business where tipping is customary for providing food and beverages, you may qualify for a federal tax credit involving the Social Security and Medicaid (FICA) taxes that you pay on your employees’ tip income. Basics of the Credit The FICA credit applies with respect to tips that your employees […]

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Will the Standard Business Mileage Rate Go Up in 2022? Yes!

After two years of no increases, the optional standard business mileage rate used to calculate the deductible cost of operating an automobile for business will be going up in 2022 by 2.5 cents per mile. The IRS recently announced that the cents-per-mile rate for the business use of a car, van, pickup, or panel truck […]

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There Still May be Time for Your Small Business to Cut 2021 Taxes

Don’t let the holiday rush keep your small business from considering some important steps to reduce your 2021 tax liability. You still have time to execute a few strategies. Purchase Assets Thinking about buying new or used equipment, machinery, or office equipment in the new year? First, you must buy them and place them in […]

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