The California Supreme Court made an important ruling in the Dynamex case. The court’s decision means that you could inadvertently improperly reclassify your independent contractors and make them suffer needlessly. The Dynamex decision and subsequent new California law causes trouble not only in California but throughout the country. If you have independent contractors … [Read more...]
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No 1099, No Deduction?
Careful! If you didn’t issue 1099s to your contractors, you could face some nasty penalties. You see, if the IRS audits your tax return, your friendly auditor may claim that you can’t deduct the contractor payments because you didn’t issue those 1099s. Ouch! And then to add salt to the wound, the IRS will impose substantial penalties for failing to file those … [Read more...]
Section 105 Medical Expense Deduction-Plans for Statutory Employees
_________________________________________________Let’s start with a definition. A “statutory employee” is an independent contractor who is treated as an employee by statute for the purposes of tax withholding. _________________________________________________ Are you a “statutory” employee? Then you should know that, if you’re qualified, you can create a Section 105 … [Read more...]
Does A Cash Overdraft Kill Tax Deductions?
Let’s assume for a moment that your checking account shows a negative balance. And let’s also assume that you write checks on December 31. This leads to an interesting question… What’s the best way to report a negative cash balance in your checking account when you pay your S corporation tax-deductible expenses on December 31? We’ll have an authoritative answer for you … [Read more...]
New Partnership Audit Procedures For 2019
Howdy partner! If you run your business as a partnership, or an LLC taxed as a partnership, there are some important things you need to know. For starters, you should be aware that Congress changed the IRS procedures for auditing partnerships. These new procedures take effect beginning with your 2018 partnership tax return. Under the new rules, an audit can lead to a … [Read more...]