While the government talks about low unemployment figures, there is strong evidence that a lot of people have left the work force thereby artificially lowering the unemployment rate. Before you consider taking on a new career take a look at the following Economic Policy Institute graph illustrating unemployed vs job openings per industry.
Per the guidance of Senate Finance Committee ranking member Ron Wyden, Oregon-Dem, the IRS is being urged to establish a better system of collecting corporate taxes that are owed, but not paid. Wyden hopes to improve the collection of corporate taxes and is leading an investigation into the IRS collection efforts during next weeks budget hearings with the U.S. Treasury Department. Read more here…
Better listen up Cam. California, like many other states, taxes a percentage of professional athletes’ income from “duty days” in the state. Duty days are days services are performed under contract during the pre-season, regular-season and post-season. Each state will get a pro-rata share of the professional athlete’s annual income allocated by duty days performed in the state divided by total duty days multiplied by annual compensation. Super Bowl L will be played in California where the top tax bracket is 13.3%.
Example: If Cam Newtown, the QB of the Carolina Panther’s, earns $13-million in 2015-2016 seasons and he has 200 total duty days, 10 of which are duty days in California, then he will have $650,000 of California taxable income.
If you have any tax questions please call Mr. Smart Tax, Inc. today! 949-877-3143 or toll-free 1-800-425-0570 or email us at Contact@MrSmartTax.com
Did you inherit real estate from a deceased spouse? The internal revenue code has special tax treatment for valuing the basis of inherited property regardless if you have estate tax filing requirements and no doubt this will impact you.
If the inherited property has appreciated in value, the surviving spouse will generally receive a step up in basis of the inherited property to the fair market value (FMV) at:
1) the date of decedent’s death or
2) on the alternate valuation date (within 6 month of the date of death).
Further, in community property states (i.e. California, Arizona, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin), married individuals are typically considered to each own 50% of the community property. As such, when either spouse dies, the entire value of the community property, including the part owned by the surviving spouse, receives a step up in basis to the FMV. For this rule to apply at least 50% of the value of the community property must be included in the deceased spouse’s gross estate regardless if the deceased spouse’s estate must file a estate tax return.
These rules can come in handy when a surviving spouse is in need of liquid capital. It should be noted that this special tax treatment can have adverse consequences if not handled correctly. Consult your tax adviser for more information.
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Most every business start-up has come across the question “LLC or S corporation?”.
While this is a very common question, the response is often different depending on who you are talking to.
It should be noted that an LLC might work for some while an S corporation could be better for others – there is no “one size fits all” approach to entity selection.
In short, here are a few pro’s and con’s for the LLC and S Corporation entity structure:
LLC –
S Corporation –
Of course there are many more pro’s and con’s for each entity selection – feel free to call us with any questions and will be happy to discuss more (800) 425-0570.
For more related information visit the following links:
http://tiny.cc/xjz22x IRS: Partners’ Share Of LLC Income Is Subject to Self-Employment Tax
http://tiny.cc/smz22x 5 Common Objections to Forming a Corporation or an LLC
September 15, 2015 – This is the last day to file a 2014 calendar year income tax return for your:
Be aware – This due date applies only if you timely requested a 6-month or 5-month extension. If you did not file an extension then there is even more urgency to file your tax return as soon as possible – expect penalties and interest if this is the case, but contact us immediately and let’s get those penalties abated!
Also, you must deposit the third installment of estimated income tax for 2015.
If you need help filing or have questions, feel free to call us today for a FREE initial consultation (800) 425-0570 or email questions to Contact@MrSmartTax.com
