A retirement plan can provide several tax benefits for you, your business and your employees. Below are few of the benefits :
– Employer contributions are tax deductible
– Assets in the plan grow tax free
– You are able to attract and retain better employees
Tax tip to business owners for petty cash account activities Don’t be nonchalant about keeping accurate records of your petty cash fund. Each time you dip into petty cash, you must make some sort of record in order to keep track of the amount being spent. Reconciliation of your petty cash account regularly will help you finding out where your money has been going and reduce risk of theft.
Tax benefits of Hiring your Kids to work for your Business: If you hire your children as employees to save tax, you can deduct the salaries you pay them. If your child is under 18, you don’t even need to pay Payroll taxes – that is payments such as FUTA and FICA that are required for other employees.
IRS considers any 1099 payment as taxable income, you are required to report your 1099 payment on your tax return. For example, if you earned less than $600 as an independent contractor, the payer does not have to send you a 1099-MISC, but you still have to report the amount as self-employment income. if you earned more than $ 600 as a contractor, it needs to be filed under 1099 Misc by end of the year.
A common mistake small business owners make is to mix business and personal funds. It’s important to have a separate Bank and Credit Card account for your business. This will make things a lot easier when it comes to managing your books and getting things organized for tax time. If you are ever audited by the IRS you want to make sure that you can produce documents that support legitimate business expenses.
You must do the following steps to be compliant with FATCA.
The following are certain conditions in which an NRI needs to report their earnings as per FATCA to the IRS. Financial institutions also need to report the same to the IRS as well.
Tax information Restricted Stock Units are taxed differently than other kinds of stock options, such as statutory and non-statutory Employee stock purchase plans. Those plans generally have tax consequences at the date of exercise or sale, whereas restricted stock usually becomes taxable upon the completion of the vesting schedule. The entire amount of the vested stock must be counted as ordinary income in the year of vesting.
Though the number of vendors supporting Bitcoin is not something to brag about, you will still find plenty of them. If you purchase any goods or services with the help of Bitcoin or any other virtual currency for that matter it must reflect in your W2 Form. Here is what you need to do.
It is important to declare the income in dollars in your W2 Form, irrespective of which virtual currency you dealt with. Self-employed individuals must include the same in their tax returns.
Though most virtual currencies are still in their nascent forms, quite a few of the investors are taking them are serious investments. They believe that the money invested in virtual currency will yield them great returns in the future; which have proven to be correct in the case of Bitcoin as of now. Should you plan to do the same, they would fall under the same category as your normal stocks, capital assets and bonds do. You are liable to pay capital gain or loss tax on your virtual currency in such a scenario.
As of now, there are two ways by which you can get your hands on the virtual currencies. First is the good old method where you buy the virtual currency using real currency. The second method is called mining. The later uses computing power to validate the transactions and keep a track of all transactions. Essentially becoming a part of the block chain.
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