Planning ahead for 2013 -- Health Savings Accounts permit eligible individuals to make deductible contributions that are allowed to be withdrawn tax-free for reimbursement of eligible medical expenses.
For 2013, the annual limitation on deductions under IRC Sec. 223(b)(2) for an individual with self only coverage under a High-Deductible Plan (HDHP) is $3,250. The family coverage limitation is $6,450. An HDHP is defined under IRC Sec.223(c)(2) as a health plan with an annual deductible that is not below $1,250 for self only coverage or $2,500 for family coverage, and an annual limit of out-of-pocket expenses of $6,250 for self only coverage ...
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The Internal Revenue Service recently announced a new online search tool that will help users to easily check on key information concerning tax-exempt organizations, like charities and other nonprofits.
The new online search tool is called Exempt Organizations Select Check – EO Select Check for short.
By utilizing EO Select Check, users can confirm if an organization:
Is qualified to receive tax-deductible charitable contributions. Previously taxpayers had to go to IRS Publication 78, but now it has been incorporated into the new tool. Taxpayers can utilize this list to verify the deductibility of contribution.
Has filed a Form 990-N annual electronic notice. The majority of ...
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The Bonding and Surety industry is expanding its analysis of contractors’ financial information; therefore the best presentation of this information is even more vital to securing and maximizing bonding capacity for your company.
In order to obtain bonding, a contractor firm should be financially healthy, well managed and have strong internal accounting controls. Surety and Bonding companies focus mainly on the contractor’s financial statements by analyzing equity, working capital, profitability trends, backlog of work and contingencies to establish bonding capacity.
An accurate financial presentation is crucial in order for the bonding company to perform a complete analysis. Most bonding companies require financial ...
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Creating an efficient A/R process is a vital step for most businesses, which often necessitates a balancing act between you and your customers.
Most likely, you and your customers have very different goals. You desire to collect payment as soon as possible for the products and/or services that you have delivered to them. Conversely, your customer wants to delay payment as long as possible. It is your job to come up with solutions that are acceptable to your customers while reducing your waiting time for payment and the potential for nonpayment.
Developing an efficient A/R process is very important
The ability to quickly ...
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Identity theft victims will soon be able to receive copies of false returns filed under their names and ID numbers as a result of an IRS counsel opinion that has not yet been made public. Since the victims, already know their ID numbers allowing them to receive copies is not a prohibited disclosure.
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The IRS recently announced that estates of married individuals where a spouse died during the 1/1/11-6/30/11 period, with assets of $5 million or less, will now have 15 months after the date of death to create a portability election. The portability election permits a surviving spouse to take into account any unused exclusion amount from the deceased spouse. The executor will need to file Form 4768 and Form 706 no later than 15 months after the date of death. The extra time can be utilized even if the estate did not request an ...
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The IRS has recently upheld that property transfers to a trust where the donors gave up any power to determine or control the beneficial enjoyment of the trust income or principal, but retained limited powers to appoint amounts still in trust at the time of the donor's death, are completed gifts. The limited powers of appointment related only to the trust remainder, and the IRS and courts have maintained that these are separate interests where the gift was complete except with respect to the remainder interest.
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The IRS has published some important facts about the American
Opportunity Credit and Lifetime Learning Credit. The act allows taxpayers to
offset higher education costs. The American Opportunity Credit can be up to
$2,500, with up to $1,000 refundable. This credit is available for the first
four years of postsecondary education while the student is pursuing an
undergraduate degree. The Lifetime Learning Credit can be up to $2,000 and
includes all years of postsecondary education, plus courses to obtain or improve
job skills. This credit does not require a student to be pursuing a degree or
another established credential.
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Recently, the IRS reminded small business owners that the fair market value of services or property obtained through barter is still taxable income. Barter exchanges generally are required to distribute Form 1099-B to its members and the IRS, whether operated out of a physical office or through the Internet. Income from bartering is taxable in the year it is performed and may result in ordinary income, capital gains or losses, or nondeductible personal losses. Bartered goods and services used as part of compensation packages are subject to the same employment tax withholding and ...
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The IRS upheld in a recent ruling that an S corporation's redemption of a portion of the nonvoting shares of an individual who held both voting and nonvoting shares did not create a second class of stock that would have terminated the S election. Additionally, the redemption did not qualify as an exchange or sale and the proceeds were not included in the taxpayer's gross income to the degree they did not surpass the accumulated adjustments account and the taxpayer's basis in the stock.
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