If you own your own business, your tax obligations likely do not end with the IRS. There are other tax agencies looking to put the bite on you as well. Small business owners can cut their taxes by taking various tax deductions. Be sure you don’t pay more taxes than you need to by being aware of the overlooked tax considerations for small business.
Tag Archive for State Income Tax
As with life’s more difficult questions, the answer is; it depends. Generally, states impose tax only on individuals who are residents of the state. As such, if an individual is a resident of a particular state and then moves abroad, such individual will most likely be treated as a part-year resident for the year of the move and will most likely be required to pay tax at least on the portion of income allocated to the period in which they were a resident.
How Professional Athletes Attribute “Rest Days” for State Income Tax Purposes: A Major Controversy Brews
Many young professional athletes and their less than experienced managers are learning for the very first time that the money “earned” PLAYING or competing is subject to income tax both at the federal level AS WELL AS AT THE STATE LEVEL WHERE THEY ARE PERFORMING or rendering service on behalf of their employer.
Basically for example if you earn money in Colorado you pay Colorado income tax as well as federal income tax on those same earnings. Professional athletes compete or perform (aka earn money) in many different states, the majority of which have a state income tax obligation, some higher than others and all pretty nasty.
A few months ago a select group of professional athletes shared concerns about Read more
(1) Section “529” – College Educational Savings Account
Set one up for your children or grandchildren. The earnings on the investments are tax free and the amounts withdrawn by you or the beneficiaries are tax free to the extent the funds are used to pay for college expenses. The contributions are not deductible on the federal return but are on the NY return. You can contribute any amount but the deduction on your NY return is limited to $5,000. Your broker can set up an account or accounts for you.
(2) Donate The IRA Minimum Distribution To Charity
When you reach age 70 2, you are required to take a minimum distribution (fair value at December 31 divided by your life expectancy in IRS tables). from your IRA (N/A to a Roth). Instead of taking it in cash, donate the minimum distribution to charity. This way you do not have to pay taxes on the distribution, but since the distribution was given to charity and was tax free, you cannot take a charitable contribution for the amount donated. If you want to do that, contact your IRA administrator and give him or her the name and address of the charity you want to donate it to.
(3) Donation Of Appreciated Property
The advantage of donating, (rather than sell them and donating the cash) stocks, bonds, mutual funds or other property that has appreciated in value is you get a charitable contribution deduction with no cash outlay for the fair Read more