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Can You Deduct Contingent Attorneys’ Fees?

Sometimes attorneys will charge clients contingent fees based on the outcome of a case, rather than billing a flat or hourly fee for services rendered. However, the federal income tax treatment of contingent fees paid to an attorney out of a taxable nonbusiness judgment or settlement has historically been a source of confusion and litigation […]
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5 Major Tax-Favored Retirement Plan Changes for Individuals under New Law

After months of negotiations, Congress finally passed the long-awaited Setting Every Community Up for Retirement Enhancement 2.0 Act (SECURE 2.0). This part of the omnibus funding package builds on the SECURE Act of 2019 and contains major changes in the required minimum distribution (RMD) rules and other retirement provisions. Here are five major taxpayer friendly […]
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Tax Treatment of Debt Forgiveness: Watch Out for Tax Bills Delivered COD

Debtors typically experience a feeling of relief when a creditor agrees to forgive their debt. But that feeling often is replaced by shock and confusion when they learn they owe taxes on so-called “cancellation of debt” (COD) income. Read on to learn the tax rules for COD income and how they might affect your tax […]
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Looking Into Long-Term Care Facilities

The need for long-term care assistance continues to grow. Roughly 5.8 million people in the United States used paid long-term care services in 2020, with about 1.9 million of those residing in long-term care facilities, according to the Congressional Budget Office. Seven out of ten people will require some form of assisted living care during […]
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What Business Owners Should Know About Financial Forecasting

Is your business ready to tackle the challenges and opportunities that lie ahead in 2023? Financial statements show how a company has performed in the past. But historical data doesn’t necessarily predict future performance, especially in an uncertain, volatile market. As part of your planning, it’s important for management to prepare forecasted statements. Forecasts vs. […]
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Important Tax Figures for 2023

The following table provides some important federal tax information for 2023, as compared with 2022. Many of the dollar amount increases are higher than in past years due to inflation. Social Security/ Medicare 2023 2022 Social Security Tax Wage Base $160,200 $147,000 Medicare Tax Wage Base No limit No limit Employee portion of Social Security […]
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LIFO vs. FIFO: Taking Stock of Your Inventory Accounting Method

How inventory is accounted for can have a significant impact on your tax bill if your business involves the production, purchase or sale of products. In some cases — particularly during periods of high inflation and stable inventory levels — adopting the last-in, first-out (LIFO) method could significantly reduce your taxable income and boost your […]
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Tricky Tax Angles to Fringe Benefits

Competition for top-notch workers can be fierce. Your business currently may be understaffed due to a number of factors — including the “Great Resignation” and “quiet quitting” where employees do the bare minimum before eventually leaving. A proven way to help attract and retain the cream of the crop is to expand or enhance your […]
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Looking Ahead: 2023 Minimum Wage and Overtime Threshold Increases

In 2023, many states and localities will increase their minimum wage amounts. In some areas, the amounts paid to tipped employees may also increase and overtime salary thresholds may also change. This chart briefly details the changes that will kick in on New Year’s Day or later in 2023. For more information about your situation, […]
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Are You Missing the Roth IRA Boat?

Many self-employed individuals are eligible to make annual contributions to Roth IRAs, despite having healthy earnings from their businesses. But some haven’t yet taken advantage of this retirement saving strategy. Making annual Roth contributions can have a big upside by allowing you to accumulate a federal-income-tax-free nest egg for retirement. Roth IRA Basics Contributions to […]