Restricted stock awards are a popular way for companies to offer equity-oriented executive compensation. Some businesses offer them instead of stock option awards. The reason: Options can lose most or all of their value if the price of the underlying stock takes a dive. But with restricted stock, if the stock price goes down, your […]
What you need to know about restricted stock awards and taxes Read More »
If you’re planning to start a business or thinking about changing your business entity, you need to determine what will work best for you. Should you operate as a C corporation or a pass-through entity such as a sole proprietorship, partnership, limited liability company (LLC), or S corporation? There are many issues to consider. Currently,
Choosing a business entity: Which way to go? Read More »
One might assume the term “trust fund recovery penalty” has something to do with estate planning. It’s important for business owners and executives to know better. In point of fact, the trust fund recovery penalty relates to payroll taxes. The IRS uses it to hold accountable “responsible persons” who willfully withhold income and payroll taxes
A refresher on the trust fund recovery penalty for business owners and executives Read More »
If you read the Internal Revenue Code (and you probably don’t want to!), you may be surprised to find that most business deductions aren’t specifically listed. For example, the tax law doesn’t explicitly state that you can deduct office supplies and certain other expenses. Some expenses are detailed in the tax code, but the general
What types of expenses can’t be written off by your business? Read More »
If you gamble or buy lottery tickets and you’re lucky enough to win, congratulations! After you celebrate, be aware that there are tax consequences attached to your good fortune. Winning at gambling. For tax purposes, it doesn’t matter if you win at the casino, a bingo hall or elsewhere. You must report 100% of your
What are the tax implications of winning money or valuable prizes? Read More »
In recent years, merger and acquisition activity has been strong in many industries. If your business is considering merging with or acquiring another business, it’s important to understand how the transaction will be taxed under current law. Stocks vs. assets. From a tax standpoint, a transaction can basically be structured in two ways: 1. Stock
It’s important to understand how taxes factor into M&A transactions Read More »
Do you and your spouse together operate a profitable unincorporated small business? If so, you face some challenging tax issues. The partnership issue. An unincorporated business with your spouse is classified as a partnership for federal income tax purposes unless you can avoid that treatment. Otherwise, you must file an annual partnership return, on Form
Spouse-run businesses face special tax issues Read More »
If you operate your small business as a sole proprietorship, you may have thought about forming a limited liability company (LLC) to protect your assets. Or maybe you’re launching a new business and want to know your options for setting it up. Here are the basics of operating as an LLC and why it might
The advantages of using an LLC for your small business Read More »
Let’s say you own highly appreciated land that’s now ripe for development. If you subdivide it, develop the resulting parcels and sell them off for a hefty profit, it could trigger a large tax bill. In this scenario, the tax rules generally treat you as a real estate dealer. That means your entire profit —
A tax-smart way to develop and sell appreciated land Read More »
You may think you don’t need to make any estate planning moves because of the generous federal estate tax exemption of $12.92 million for 2023 (effectively $25.84 million if you’re married). However, if you have significant assets, you should consider establishing a living trust to avoid probate. Probate is a court-supervised legal process intended to
Benefits of a living trust for your estate Read More »