Everything You Need to Know About Office Email Etiquette

Okay, so we violate a few of these rules from time-to-time, but they are still good reminders.  And funny!

 

Are You Self Employed? Check Out These IRS Tax Tips

IRS Tax Tip 2015-34, March 9, 2015

Many people who carry on a trade or business are self-employed. Sole proprietors and independent contractors are two examples of self-employment. If this applies to you, there are a few basic things you should know about how your income affects your federal tax return. Here are six important tips about income from self-employment:

• SE Income.  Self-employment can include income you received for part-time work. This is in addition to income from your regular job.
  
• Schedule C or C-EZ.  There are two forms to report self-employment income. You must file aSchedule C, Profit or Loss from Business, or Schedule C-EZ, Net Profit from Business, with your Form 1040. You may use Schedule C-EZ if you had expenses less than $5,000 and meet other conditions. See the form instructions to find out if you can use the form.
  
• SE Tax.  You may have to pay self-employment tax as well as income tax if you made a profit. Self-employment tax includes Social Security and Medicare taxes. Use Schedule SE, Self-Employment Tax, to figure the tax. If you owe this tax, make sure you file the schedule with your federal tax return.
  
• Estimated Tax.  You may need to make estimated tax payments. People typically make these payments on income that is not subject to withholding. You usually pay this tax in four installments for each year. If you do not pay enough tax throughout the year, you may owe apenalty.
  
• Allowable Deductions.  You can deduct expenses you paid to run your business that are both ordinary and necessary. An ordinary expense is one that is common and accepted in your industry. A necessary expense is one that is helpful and proper for your trade or business.
  
• When to Deduct.  In most cases, you can deduct expenses in the same year you paid for them, or incurred them. However, you must ‘capitalize’ some costs. This means you can deduct part of the cost over a number of years.

Visit the Small Business and Self-Employed Tax Center on IRS.gov for all your federal tax needs. You can also get IRS tax forms on IRS.gov/forms anytime.

If you found this Tax Tip helpful, please share it through your social media platforms. A great way to get tax information is to use IRS Social Media. You can also subscribe to IRS Tax Tips or any of our e-news subscriptions.

Additional IRS Resources:

• Form 1040-ES, Estimated Tax for Individuals
• Publication 505, Tax Withholding and Estimated Tax
• Publication 334, Tax Guide for Small Business
• Publication 535, Business Expenses

3 Tax Deductions You May Have Missed

Well, it’s that time of year again.  No, not saying farewell to Downton Abbey and hello to binge watching House of Cards.  Although…

It’s tax season!  For many of you, that is already a thing of the past, since you have met with your amazing CPA.  For the rest, well, let’s look at some possible tax deductions you may be missing.

1.       Taxes

So you can write taxes off your taxes?  That’s not crazy talk; that’s true!  For example, the property taxes you pay for the building you own and operate your business in (businesses operated out of your home count, too) are tax deductible.  Keep in mind, these taxes are only eligible to be deducted in the year they’re paid.

In general, the four types of deductible non-businesses taxes are:

1. State, local, and foreign income taxes.
2. State, local, and foreign real estate taxes.
3. State and local personal property taxes.
4. State and local general sales taxes.

For a more in-depth look at deductible taxes and how to claim them, check out Topic 503 on the IRS website.

2.       Advertising

This includes pay-per-click ads, print ads, event sponsorships, and even business cards can be deducted, as long as there is a clear association between the expense and your business.  Quick note: if you sponsor an event , make sure that the event’s materials mention your business as the sponsor, not an individual participant.

3.       Bad Debts

Did you know that not everyone pays their debt back?  Yeah, of course you did.  Instead of complaining about it on Facebook , you can spend that energy deducting this bad debt from your taxes.

Examples of deductible bad debts include:

• Credit sales to customers (#1 offender)
• Loans to clients and suppliers
• Business loan guarantees

Review IRS Tax Topic 453 for more information on how to deduct bad debts.

*Disclaimer: To be deductible, a business expense must be both ordinary and necessary. An ordinary expense is one that is common and accepted in your trade or business. A necessary expense is one that is helpful and appropriate for your trade or business. An expense does not have to be indispensable to be considered necessary.

If you have any questions at all, contact Hardee Accounting!