Making the most of the new deduction for seniors
Beginning in 2025, individuals age 65 or older generally can claim a new “senior” deduction of $6,000 under the One Big Beautiful Bill Act (OBBBA). But if your 2025 modified adjusted gross income (MAGI) exceeds $75,000 ($150,000 if you’re a married joint filer), a MAGI-based phaseout will reduce (or may even eliminate) the deduction. If you’re at risk of the senior deduction phaseout, you can take steps before year end to reduce your MAGI and maximize your deduction. For example, harvest capital losses in taxable brokerage accounts to offset capital gains that would otherwise increase your MAGI. Contact us to discuss additional MAGI-reduction tips and other year-end tax planning strategies.
Charitable Giving Reimagined: Understanding Deduction Changes Under the One Big Beautiful Bill Act (OBBBA)
The recently enacted One Big Beautiful Bill Act (OBBBA) has ushered in a wave of reforms to the U.S. tax code, including sweeping changes to charitable contribution deductions. These changes will take effect in the 2026 tax year. Whether you are a donor seeking to maximize your tax efficiency or a nonprofit professional aiming […]
Executive Order Requires Electronic Payment of Federal Taxes
On March 25, 2025, President Trump signed Executive Order 14247 to modernize the government’s payment systems to prevent waste, fraud and abuse and also improve the efficiencies and customer experience across all federal and collection activities. Starting September 30, 2025, the Department of Treasury will cease to issue paper checks for all Federal disbursements. All […]
Tax Court case provides lessons on best recordkeeping practices for businesses
Business owners: Meticulous recordkeeping plays a crucial role in tax saving and IRS compliance. For example, keep business and personal finances separate. Open a dedicated business checking account and credit card. Mixing personal and business expenses can attract IRS scrutiny. Retain purchase and sale invoices, receipts, bank statements, canceled checks, and credit card bills. Scanning or photographing receipts ensures they won’t fade or get lost. Also, keep copies of Forms 1099-MISC and 1099-NEC. There are also specific employment tax records you must keep. Contact us to discuss how we can help you establish sound recordkeeping practices, avoid penalties and protect valuable tax breaks.
Occupational fraud still affects many businesses
The more things change, the more they stay the same. This saying applies to many things, including fraud perpetrated against businesses by their employees. Occupational fraud comprises three basic categories. First, there’s asset misappropriation. This is theft or misuse of any business asset, but it often involves cash. The second category is corruption, where dishonest employees in positions of influence engage in schemes such as collusion and kickbacks. The third category is financial statement fraud. Here, perpetrators falsify financial statements to either hide poor performance or commit outright theft. Contact us for help fighting occupational fraud within your company.
The power of catch-up retirement account contributions after 50
Are you age 50 or older? You’ve earned the right to supercharge your retirement savings with extra “catch-up” contributions to your tax-favored retirement account(s). An eligible taxpayer can make extra catch-up contributions of up to $1,000 annually to a traditional or Roth IRA. If you’ll be 50 or older as of Dec. 31, 2025, you can make catch-up contributions for 2025 by April 15, 2026. However, there are income limits to make contributions. You also must be age 50 or older to make catch-up contributions to an employer 401(k), 403(b), or 457 retirement plan (if the plan allows them). You can make extra contributions of up to $7,500 to these accounts for 2025. Questions? Contact us.
Receive $10,000 in cash at your business? The IRS wants to know about it
If your business receives large amounts of cash or cash equivalents, you may be required to report the transactions to the IRS. Each person engaged in a trade or business who receives more than $10,000 in cash in one transaction, or in two or more related transactions, must file Form 8300. Transactions conducted in a 24-hour period are considered related. Cash equivalents include cashier’s checks, bank drafts, traveler’s checks and money orders. (Currently, digital asset receipts don’t have to be reported on Form 8300.) Many businesses are now required to e-file these forms. The rules apply to individuals, businesses, associations, trusts and estates. Contact us with questions.
Businesses strive for balance in hybrid work models
Since the pandemic, many businesses have sought to strike a balance between allowing some remote work while also requiring employees to come into the office. If your company operates under a hybrid work model, handle the related issues carefully. For example, you could let employees set their own schedules, have supervisors or teams do it, or mandate scheduling yourself. Another important issue is how strongly you communicate, track and enforce hybrid work policies. Last, there’s the not-so-small matter of costs. Keep a clear and constant view of hybrid work’s financial implications. Contact us for help identifying all relevant expenses to ensure your hybrid model remains sustainable.
Run a business with your spouse? You may encounter unique tax issues
If you and your spouse operate an unincorporated small business, you face some unique tax issues. For example, an unincorporated spousal business is generally classified as a partnership for federal tax purposes. (However, in community property states, you can treat the business as a sole proprietorship.) As a partnership, you must file an annual partnership return and both spouses must receive Schedules K-1, which allocate taxable income, deductions and credits between the two. With your joint tax return, you must also pay self-employment (SE) tax on your share of the net SE income passed through to you by the partnership. Your spouse must do the same. Contact us for tax-saving strategies.
5 ways your business can build a stronger annual budget
As summer gives way to fall, many businesses begin their annual budget-setting processes. Here are five ways to improve this often-difficult task: 1) Optimize data to eliminate confusing or conflicting information that could hamper budget performance. 2) Involve the entire organization to gain insights from each department’s knowledge base. 3) “Sell” your budget to staff, clearly explaining its rationale and objectives. 4) Once the budget is in place, monitor cash flow carefully and create a plan for shortfalls. 5) Get an objective opinion on your budgeting process. We can show you how to better analyze historical financial data, identify cost-saving opportunities and more.
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