Tag Archive for Income Tax

Choosing Between A ‘C’ OR ‘S’ Corporation – Weighing Tax Attributes

Ron Oddo

Question most CPAs as to what business form they suggest for the business clients and they typically answer, “A C Corporation—at least in the early capital formation years of the business.” Ask any Investment Banker or other Transaction Advisor what entity they prefer and you will likely hear, “An S Corporation or LLC (Limited Liability Company), or perhaps a partnership or sole proprietorship. Anything, anything, but a C Corporation!”

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Tax Policy Reforms Driven By Focus On Boosting Growth


While fiscal consolidation was the key driver of tax reforms in the years following the global economic crisis, the main emphasis of recent tax reforms has shifted back to tax measures aimed at boosting economic growth, according to a new OECD report.

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Deciphering Campaign Tax Proposals

Annette Nellen

Here is my 15 minute presentation to the San Jose Rotary Club delivered today (May 11) on deciphering campaign tax proposals and helping members increase their tax policy savviness.

Deciphering Campaign Tax Proposals

Presentation delivered to Rotary International San Jose Chapter (District 5170) on May 11, 2016. Read more

IRS Provides Tax Relief to Houston Area Storm Victims; Tax Deadline Extended to Sept. 1

David Green

Texas storm victims, including those in the Houston area, will have until Sept. 1, 2016 to file their returns and pay any taxes due, the Internal Revenue Service announced today. All workers assisting the relief activities who are affiliated with a recognized government or philanthropic organization also qualify for relief. Read more

December 2015 Business Due Dates

Barry Fowler34

December 1 – Employers

During December, ask employees whose withholding allowances will be different in 2016 to fill out a new Form W4 or Form W4(SP).  

December 15 – Social Security, Medicare and Withheld Income Tax

If the monthly deposit rule applies, deposit the tax for payments in November.

December 15 – Nonpayroll Withholding

If the monthly deposit rule applies, deposit the tax for payments in November. Read more

Facing A Huge Gain From A Realty Sale?

Barry Fowler21

If you are contemplating selling real-estate property, there are a number of issues that could impact the taxes that you might owe, and there are steps you can take to minimize the gain, defer the gain, or spread it over a number of years.

The first and possibly most important issue is adjusted basis. When computing the gain or loss from the sale of property, your gain or loss is measured from your adjusted basis in the property. Thus, your gain or loss would be the sales price minus the sales expenses and adjusted basis.

So what is adjusted basis? Determining adjusted basis can sometimes be complicated, but in a simplified overview, it is a dollar amount that starts with your acquisition value and Read more

You Came Up Short


Governments will try to get away with almost anything during wartime. In the Civil War, President Abraham Lincoln suspended the writ of habeas corpus so federal authorities could lock up suspected Confederate sympathizers and throw away the keys. This action was more than mere ink on paper; it was very vigorously enforced, especially in Maryland and other Border States. He also signed the Revenue Act of 1861, which put an income tax into effect. The government gave up in 1862, partially due to Constitutional concerns regarding the Apportionment Clause (all taxes must be apportioned between the states), but mostly because the Revenue Act simply didn’t raise much money.

Congress took care of that Constitutional technicality with the 16th Amendment in 1913. But it wasn’t until 1943 (yet another war) that the money started rolling in. (See Video Read more

The Consequences of Losing Tax-Exempt Status

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When a church or religious organization loses its tax-exempt status, the obvious consequences are that donations to the organizations can no longer be deducted by donors. In addition, loss of tax-exempt status means that the organization is subject to federal and state income taxes on its net income. That last statement is not quite as bad as it sounds, though because the tax is on net income, not the gross. Most such organizations tend to spend most, if not all, of their income on programs and infrastructure. Therefore, there would be little or no net income and no income tax to pay.

There are numerous other consequences involved with losing one’s tax-exempt status that can affect the organization significantly. Read more

May 2015 Business Due Dates

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May 11 – Social Security, Medicare and Withheld Income Tax

File Form 941 for the first quarter of 2015. This due date applies only if you deposited the tax for the quarter in full and on time.

May 15 – Employer’s Monthly Deposit Due

If you are an employer and the monthly deposit rules apply, May 15 is the due date for you to make your deposit of Social Security, Medicare and withheld income tax for April 2015. This is also the due date for the non-payroll withholding deposit for April 2015 if the monthly deposit rule applies.

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Is There Anything as Nontaxable Income?

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Nontaxable or tax exempt income is income that is not subject to income tax, and you do not report these on your tax return. Surprisingly to some taxpayers, there are quite a number of income sources that are actually nontaxable, and these include the following:

• Child support.
• Federal tax refunds.
• Interest on state or local government obligations, such as municipal bonds.
• Welfare and other public assistance benefits.
• Workers’ compensation and similar payments for sickness and injury.
• Meals and lodgings provided by your employer. These will be excluded from your taxable income if: (a) the meals are furnished on your employer’s business premises, (b) the Read more

London Mayor Refuses To Pay U.S. Tax Bill

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London Mayor Boris Johnson is being pursued by U.S. tax officials while his former New York counterpart Michael Bloomberg was given an honorary knighthood by Queen Elizabeth last month.

Beware As The U.S. Tax Net Closes On Thousands Of U.S. Citizens Living Abroad.

The Conservative mayor of London – who was born in New York and holds an American passport – just revealed he is being pursued by the U.S. authorities for an unpaid tax demand. The demand reportedly relates to his first home in the UK, which he said was not subject to capital gains tax in England. According to U.S. tax law all citizens are required to file a tax return and pay U.S. taxes, even those with dual citizenship and Read more

Learning The Mechanics of A Foreign Tax Credit!

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Income tax systems that tax residents on worldwide income (such as the American tax system) generally offer a foreign tax credit to relieve a potential for double taxation. This credit is usually limited to the income attributable to foreign source income.

What does this mean? If you paid or accrued foreign taxes to a foreign country on foreign source income and are subject to U.S. tax on the same income, you may be able to take either a credit or an itemized deduction for those taxes.

This means that, if taken as a deduction, foreign income taxes reduce your U.S. taxable income. Or if taken as a credit, foreign income taxes reduce your U.S. tax liability. One can choose whether to take the amount of any qualified foreign taxes paid or accrued during Read more