As Baby Boomers approach retirement, many are considering downsizing their homes to simplify their lives and reduce expenses. However, what seems like a straightforward decision is often complicated by financial and tax implications, especially in today’s volatile housing market. This guide aims to shed light on the challenges and opportunities that come with downsizing, offering…
The SECURE 2.0 Act brings forth an intriguing opportunity for individuals with surplus funds in their 529 college savings accounts by allowing for a tax-free rollover of unused assets into the beneficiary’s Roth IRA starting in 2024. While this provision offers a new dimension to retirement savings planning, it’s essential to approach it with careful…
One fundamental financial practice that often gets overlooked, yet holds immense importance, is the separation of personal and business finances. By maintaining distinct bank accounts and credit cards for business transactions, small business owners can streamline bookkeeping processes, ensure accurate expense tracking, and foster clarity in financial management. Importance of Separating Personal and Business Finances:…
The Employee Retention Credit (ERC) was a government-sponsored program to keep workers employed during the Covid-19 pandemic. It provided qualifying employers with a refundable credit against certain employment taxes equal to 70% (up from 50% prior to 2021) of the qualified wages that an eligible employer paid to employees after March 12, 2020, and before…
The U.S. Department of Labor (DOL) announced on Jan. 9, 2024, the issuance of its final rule regarding whether a worker is an employee or an independent contractor under the federal Fair Labor Standards Act (FLSA). The new rule, which becomes effective March 11, 2024, rescinds the 2021 independent contractor rule issued under former President Donald Trump…
Whether you just started using QuickBooks to manage your small business in 2024 or you have been muddling along for years with unanswered questions, diving into financial software can feel like swimming through uncharted territory. Your business’s financial health depends on accurate bookkeeping and seamless transactions, which is where QuickBooks comes in. This accounting software…
If you have a parent entering a nursing home, taxes are probably the last thing on your mind. But you should know that several tax breaks may be available to help offset some of the costs. Medical expense deductions The costs of qualified long-term care (LTC), such as nursing home care, may be deductible as…
How to nail down current deductions If your business completes minor repairs by December 31, you can deduct those costs on your 2023 tax return. But different tax rules apply to improvements. As opposed to repairs, improvements are capital expenditures that must be written off over time. Safe harbors How can you tell whether work…
The 3.8% net investment income tax (NIIT) is an additional tax that applies to some higher-income taxpayers on top of capital gains tax or ordinary income tax. Fortunately, there are strategies you can use to soften the blow of the NIIT. Are you subject to the NIIT? You’re potentially liable for the NIIT if your…
Tax credits are far more valuable than tax deductions. Unlike a deduction, which reduces a business’s taxable income, a credit reduces the business’s tax liability dollar for dollar. Tax credits aren’t unlimited, however. For businesses, the aggregate value of tax credits may be limited by the general business credit (GBC), found in Internal Revenue Code…
