A new year means new tax figures for individuals
Many tax figures are annually adjusted for inflation and typically increase each year. For example, for 2026, the standard deduction increases to $16,100 for single filers, $24,150 for heads of households and $32,200 for married couples filing jointly. And the IRA contribution limit increases to $7,500. Other figures increase in 2026 due to the One Big Beautiful Bill Act. For instance, it boosts the lifetime gift and estate tax exemption to $15 million and the child and dependent care FSA contribution limit to $7,500. These are only some of the figures and limits that could affect your 2026 taxes. To learn more and begin planning for the new year, contact us.
Important 2026 tax figures for businesses
A new year brings many new tax-related figures for businesses. While bonus depreciation remains at 100%, the Sec. 179 expensing limit increases to $2.56 million for 2026, with the phaseout threshold at $4.09 million. The income ranges over which the Sec. 199A qualified business income deduction limitations phase in also increase. For 2026, they’re generally $201,750 – $276,750, double those amounts for married couples filing jointly. But under tax legislation signed into law in 2025, the threshold for the excess business loss limitation drops significantly for 2026, to $256,000 (double that amount for joint filers). We can help you factor these changes and others into your 2026 tax planning.
More individuals with disabilities will be eligible for tax-advantaged ABLE accounts in 2026
Did you know there’s a tax-advantaged way to save for the expenses of a person with a disability? Achieving a Better Life Experience (ABLE) accounts can help fund qualified disability expenses for an eligible beneficiary. And eligibility expands beginning in 2026! For 2025 and prior years, the individual must have become disabled or blind before turning age 26 to be eligible. But this age increases to 46 for 2026 and beyond. Contributions of up to $19,000 in 2025 and $20,000 in 2026 can be made to an ABLE account. They’re not deductible, but distributions used for qualified expenses are tax-free. To learn more about the tax benefits and other financial considerations, contact us.
Avoiding inadvertent S corp termination
S corporation structure provides most of the tax benefits of a partnership plus the liability protection of a corporation. But because of the strict requirements that apply to these entities, preserving S corporation status requires due diligence. To avoid inadvertent termination of S corporation status, among other things, you should continually monitor the number and type of shareholders, scrutinize the terms of any trusts that hold shares, and include provisions in buy-sell agreements that prevent transfers to ineligible shareholders. Also, avoid actions that may be deemed to create a second class of stock, such as making disproportionate distributions. Contact us if you have questions.
Revisiting the balanced scorecard approach to strategic planning
Strategic planning can be challenging for small to midsize businesses that rely primarily on financial reports to make decisions. Introduced in the early 1990s, the balanced scorecard approach offers a proven framework for turning strategy into action by looking beyond the numbers. It organizes planning around four critical areas: 1) customers, 2) finance, 3) processes, and 4) learning and professional growth. By focusing on clearly defined objectives and a limited set of meaningful metrics for each area, you can gain a clearer view of your company’s performance and future direction. Regardless of how you approach strategic planning, contact us for guidance and support.
Not all “business” expenses are tax deductible
With 2025 in the rear view mirror and the tax filing deadline on the road ahead, it’s a good time for businesses to start gathering information about their deductible expenses for 2025. But what’s deductible (and what’s not) might not be as clear-cut as you think. Most business deductions aren’t specifically listed in the Internal Revenue Code (IRC). The general rule is what’s stated in the first sentence of IRC Section 162, that you can write off “all the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business.” In addition, you must be able to substantiate the expenses. We can help you determine what you can deduct on your 2025 tax return.
What business owners should know about debt restructuring
Debt commonly helps small and midsize businesses fund startup costs, growth, equipment purchases and cash flow. Problems typically arise not because debt exists, but because its terms no longer align with operational realities. If your business encounters such trouble, consider debt restructuring. It involves discussing reasonable solutions with lenders, such as extending repayment periods, modifying payment schedules or consolidating multiple loans. Although often associated with financial distress, restructuring can also be used strategically by healthy businesses to facilitate long-term sustainability. Contact us for help assessing its implications and exploring alternatives.
Consider these issues before providing (or reimbursing) mobile phones
Employees often appreciate receiving mobile phones or reimbursements for business-related personal phone costs. But what seems like a simple fringe benefit can introduce security threats, productivity challenges and tax implications. For example, to help ensure the IRS treats work-issued phones as a nontaxable fringe benefit, you must provide them “primarily for noncompensatory business purposes.” Make sure phones are fully protected against cyberthreats and employees understand when and how they’re allowed to use their phones, particularly when accessing company data. Contact us to discuss potential equipment cost, tax and security issues.
If you suffered a disaster, you may be eligible for a casualty loss tax deduction
Every year, many taxpayers experience damage to their homes or personal property from storms, floods, wildfires or other disasters. For 2025 income tax returns due April 15, 2026, personal casualty loss deductions are generally limited to those due to federally declared disasters. But, effective for losses occurring on or after Jan. 1, 2026, eligible disasters also include certain state-declared disasters. Even when the cause of a loss qualifies you for the deduction, additional limits apply. For example, your deduction is reduced by insurance proceeds received, a 10% of adjusted gross income floor applies, and you must itemize deductions. Contact us for help determining if you’re eligible.
Unite your company’s sales team around a USP
A unique selling proposition (USP) is a clear, concise statement that explains the distinct value of your products or services and why customers should choose your business over the competition. Developing a strong USP requires thoughtful internal discussion and a keen understanding of competitors. A certain amount of “competitive intelligence gathering” may be necessary. Once defined, your USP should guide not only sales conversations but also marketing, customer service and operational decisions. You can measure its impact through metrics, such as conversion rates and sales cycle length. Contact us for help evaluating the financial impact of your USP and measuring its effectiveness.