Archive for the Taxes Category

What is this a 1099-K?

If you a business owner or service provider of any sorts, you should be familiar with the 1099 form, especially if you are an independent contractor.  Starting this year in 2012, any gross amount of income that you received in 2011, that was settled by a  third party network for example eBay’s PayPal, Google Wallet, or Amazon will now be reported on a new tax form called the 1099-K Merchant Card and Third Party Payments form.  This new 1099-K tax form has been considered a way for the IRS to flag upcoming audits.  Read more here.

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IRS Cracksdown on Identity Theft

Since the IRS open the tax filing season on January 17, 2012, the Justice Department’s Tax Division and local U.S. Attorneys’ Offices targeted 105 people in 23 states on indictments, arrests and the execution of search warrants involving the potential theft of thousands of identities and taxpayer refunds.  Along with 939 criminal charges which included 69 indictments and information related to identity theft.  Read more here.

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My first E-book, yippee!!!

We’ll after investing in a book writing course to prepare me for writing my first personal finance book, I have made one accomplishment and completed my first E-book “75 Common Tax Deductions for Small Business Owners”.  Although this is not the big kahuna which is my Personal Finance book this is a start, and it’s getting me in the writing spirit.  I know your wondering why I chose this topic as my first E-book, well the reason is simple I often get bombarded with questions from clients and prospects on what’s tax deductible.  So instead of rehearsing the same answer over and over again, I can now point individuals to the source of information for FREE.  This E-book is an informative read if you’re wondering what you can and can not deduct.  I used youpublish.com to upload my E-book for download; there is no fee for the service.  The website is user friendly so if you have basic computer skills like myself uploading the PDF version of the book will not be a problem for the most novice computer.  Again check the E-book out and tell me what you think.

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Retirement Plan Options for Business Owners

Retirement planning is an important part of wealth accumulation, many business owners are aware of the Traditional 401(K), but are unable to meet the requirements of administering the retirement plan. Here is a list of six of the most widely used retirement plan options for business owners to consider.

 1. SEP-IRA. A retirement plan where the business owner makes contributions on behalf of the employee and his/or herself. The tax advantage of having a SEP-IRA is the contributions made for both the business owner and employee are tax deductible on the business owner’s personal tax return. The contribution limit for the business owner is either $49,000 or 25% of compensation.

 2. SIMPLE IRA. A small business with 100 or fewer employees can offer a retirement plan to the business. The employer (business owner) can get a tax deduction on his or her personal return. Employers share the cost of the contributions with employees. The match is 3% of annual compensation.

3. SOLO (K). Also referred to as a Single (K), Unit (K) or Personal (K), this retirement plan is best suited for business owners with no employees. If the business owner has family members who are employee’s contributions can be made by them as well.

4. Profit Sharing Plan. This plan allows the employer each year to determine how much to contribute to the plan, which is based on the company’s profit. The employer contributions are tax deductible, and the employee contributions are immediately vested.

5. Safe Harbor 401(K). Similar to a Traditional 401(k), employer (business owner) is required to make contributions on behalf the employees. The match is 100% of the first 3%.

 6. Employee Stock Ownership plan (ESOP). A deferred contribution plan that is invested primarily in employer’s company stock.

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