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THURSDAY TAX TIDBITS

Tax Tip: Start Planning Ahead!

It is never too early to start thinking about the upcoming tax season. Don't procrastinate and be prepared for the tax reform changes that have been implemented this year. Under the Trump Administration, there have been several tax changes that may impact you or your business. Here are some changes that may impact you:


Tax Reform: Business Impact
There are many business considerations, including the corporate tax rate, limitations on net interest expense, full expensing of business assets, changes to net operating loss deductions, limitation of like-kind exchanges, limitation on deductibility of FDIC premiums, corporate alternative minimum tax, rules for recognition of income, changes to business tax credit, the modified limit on excessive compensation, and the modified deduction for meals and elimination of entertainment expenses. Not being able to claim the same expenses as before may lead to higher taxes! Tax Reform: Individual Impact
Individuals will …
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THURSDAY TAX TIDBITS

What is the Dark Web?

As a tax accountant, I see and witness many clients falling victim to identity theft. Because of this, I make it my responsibility to bring awareness to the issue as much as I can. Recently, I came across an AARP article discussing what the Dark Web is. I found the article to be interesting and believe it is something of value to my blog readers. The intelligence and skill behind hacking are so advanced with today's technology; it is scary and difficult to know how to protect yourself from it. I encourage you to read AARP's article and share with friends and family. For more questions, our accountants at Cunningham Tax Help have the resources that can help you and your situation. We are open Monday through Friday from 9 AM to 5 PM; contact us by email or phone at: thetaxlady4u@gmail.com or 253.581.1461

AARP Article: https://www.aarp.org/money/scams-fraud/info-2018/what-is-the-dark-web.html

Follow me! Twitter: @thetaxlady4u And ask me about PolkaDotPowerhouse!

THURSDAY TAX TIDBITS

IRS Announces Major Changes to Form W-4!

Earlier this week the IRS and Treasury Department announced that the major changes for Form W-4 are to be delayed until the tax year 2020. These changes were planned to be made in 2019, however, after sharing the drafted version, the IRS and Treasury Department listened to feedback and decided to postpone the changes. Minor changes will be made to the 2019 W-4, but it will remain largely consistent with the present draft. 

In the meantime, it is important for individuals to learn how these changes may impact their personal finances. The IRS encourages taxpayers to use the paycheck checkup at https://www.irs.gov/payments/tax-withholding and review their withholding situation. By doing so, you can ensure withholding is not under-withheld or over-withheld. If under-withheld, there is a chance of having to pay taxes at the end of the year or receiving a smaller refund.

Don't ignore this issue until it is tax season. For more questions on how this …

THURSDAY TAX TIDBITS

PSA: Sales Tax Warning

Have you received one of these notices with your online order?


Confused about what this is? Let us help you! Last year, Washington state imposed a new bill to increase sales tax revenues. Out-of-state sellers are required to inform Washington State consumers of sales tax that is due on any purchases. They are required to attach this disclosure to applicable purchases if not, they are susceptible to hefty penalties. However, this only applies if the out-of-state seller has retail sales to Washington customers of more than $10,000. The notice sellers must provide need to inform Washington purchasers that:
Sales or use tax is due on certain purchasesWashington requires the purchaser to file a use tax returnThe notice is required under RCW 82.13.020(2)(a)(i)This bill was signed in July 7, 2017, and started to be enforced on January 1, 2018. Many Washington purchasers are uninformed and unaware about these notices or change in the bill. For more questions on how this …

THURSDAY TAX TIDBITS

6 Steps to Starting Your Business!

Do you have a great idea that you know will be a successful business? Or do you have the dream to open a small business, but don't know how to start? I get it, it's scary and overwhelming to think about everything you need to do to get started! Here is a list of the 6 steps you need to take to make your idea and dream into a reality:


Conduct Market ResearchMarket research will tell you if there’s an opportunity to turn your idea into a successful business. Gather information about potential customers and businesses already operating in your area. If you are unsure about your innovative ideas, we will provide honest feedback and help you dream of an idea you are passionate about!

Create a Business Plan

Your business plan is the foundation of your business. Cunningham Accountants will help you create a roadmap for how to structure, run, and grow your new business. We want to help you start your business, but your company's growth is important t…

THURSDAY TAX TIDBITS

Why You Should Turn Your Business Into An S Corp!

Are you thinking about starting your business or do you think your business couldn't be running any better? Whatever your business ownership position is, start thinking about turning your business into a corporation. An S Corp is a: "is a closely held corporation that makes a valid election to be taxed under Subchapter S of Chapter 1 of the Internal Revenue Code." Being an S Corp protects your personal liabilities from any business losses. There are more benefits to becoming an S Corp, such as tax and deductibility benefits. Here are some reasons why you should consider becoming an S Corp:


❖Save money on self-employment tax
❖W2 at year end
❖Deductibility of wages & payroll tax, employer portion
❖Rent expense paid to the shareholder 
❖Liability protection
❖Perpetual existence
❖Costs

To understand how this applies, the table below demonstrates the accounting differences between a Sole Proprietorship and an S Corp:


Start growing …

THURSDAY TAX TIDBITS

Five Facts the IRS doesn't want you to know!



1. Calling the IRS for help won't work.

Calling the IRS usually requires you to stay on hold. Last year, 35.6% of phone calls went unanswered by representatives; that's a lot! Additionally, this year the IRS projects that they will only serve 43 percent of callers after they wait for 30 minutes. Crazy, I know!
2. The IRS can't handle all the paperwork either.
About 50 percent of letters the IRS receives have not been handled in a timely manner. The IRS deals with over a million pieces of correspondence; it takes an average of 45 days to respond.
3. The IRS is worried about ObamaCare collection.
If you received a subsidy based on your projected income, and you made more than that estimate, you may have to pay back part of the subsidy. If you did not have a health care plan, you may be able to file for an exemption or you could owe a small penalty. The Trump administration ended this policy, however, it is not effective until …