S Corporation Strategies for Commissions: What Every Business Owner Needs to Know
We continue to see aggressive advice circulating about routing personal commissions through an S corporation to reduce self-employment tax. This strategy sounds attractive, but it fails under long-standing tax law and creates significant audit risk. Consider a common setup: An individual earns commissions under contracts issued in his personal name. He holds the required state […]
OBBBA Delivers Bigger Tax Deductions for Business Owners
Here’s good news beginning in 2025. The One Big Beautiful Bill Act (OBBBA) permanently eases the rules that limit the deduction for business interest expense. Background The deduction for business interest expense is generally limited to the sum of You carry disallowed business interest forward to future years. While these rules remain in place, the […]
Understanding the Overtime Deduction Under the OBBBA
Do you regularly earn overtime pay? If so, the One Big Beautiful Bill Act (OBBBA) may help lower your federal income tax bill by adding to the deduction of qualified overtime income. New Overtime Deduction Before 2025, the IRS taxed every dollar of your overtime pay as ordinary income. Beginning this year (2025) and continuing […]
OBBBA 2025 Update: Bigger Tax Savings for Business Owners Hiring Their Kids
If you own a business and have children, the One Big Beautiful Bill Act (OBBBA) just made the popular “hire your child” tax strategy even more attractive starting in 2025. Read more about the tax savings you can take advantage of for hiring your kids. Thanks to the OBBBA, the standard deduction for a single […]
Tax Planning Updates: Inherited IRAs
If you have inherited an individual retirement account (or may someday inherit) IRAs, the 2025 changes may significantly impact your tax planning. Key Updates Spouses and Special Cases Planning Strategies Strategic withdrawals can help you avoid higher tax brackets. For example, spreading withdrawals evenly over 10 years can minimize tax impact. Timing withdrawals based on […]
Six Things To Know About 529 Withdrawals
The big advantage of 529 plans is that qualified withdrawals are always federal-income-tax-free—and usually state-income-tax-free too. What you may not know is that not all 529 withdrawals are tax-free qualified withdrawals, even in years when you have heavy college costs. Here are six important points to know about 529 withdrawals. Point No. 1: You Usually […]
2024 Last-Minute Tax Deductions for Existing Vehicles
December 31 is just around the corner! That’s your last day to find tax deductions available from your existing business and personal (yes, personal) vehicles that you can use to cut your 2024 taxes. Don’t wait, get on this now! 1. Take Back Your Child’s or Spouse’s Car and Sell It We know—this sounds horrible. […]
2024 Last-Minute Medical Plan Tax Strategies
All small-business owners with one to 49 employees should have a medical plan for their business. Sure, it’s true that with 49 or fewer employees, the tax law does not require you to have a plan, but you should. When you have 49 or fewer employees, most medical plan tax rules are straightforward. Here are […]
2024 Last-Minute Tax-Saving Vehicle Purchases
Here’s an easy question: Do you need more 2024 tax deductions? If the answer is yes, continue reading about last-minute tax-saving vehicle purchases. Next easy question: Do you need a replacement business vehicle? Consider if making last-minute tax-saving vehicle purchases could also be beneficial in this scenario. If so, you can simultaneously solve or mitigate […]
2024 Last-Minute Business Income Tax Deductions
The purpose of this blog post is to reveal how you can get the IRS to owe you money through smart business tax deduction strategies. Of course, the IRS will not likely cut you a check for this money (although in the right circumstances, that will happen), but you’ll realize the cash when you pay […]