New User?
 

KNOWLEDGE CENTER

Interested in Interviewing a TaxTalk Expert?

Are you a reporter interested in interviewing a TaxTalk expert?
E-mail media@NASE.org or call 800-743-8950


WATCH VIDEOS:
TaxTalk with NASE's National Tax Advisor Keith Hall

TaxTalk - Unlimited Tax Advice for the Self Employed Subscribe to RSS Feed Ask a Question
  • Paying My Child

    Q: I own a bookkeeping business and pay my 16-year-old daughter to help around my office after school. Are the wages I pay her subject to FICA and Medicare taxes? A: The answer depends on how your business is legally structured. If your company is a corporation, then your daughter’s wages are subject to those taxes, even if you, as the child’s parent, own the corporation. If your company is a sole proprietorship or a partnership in which only the parents are partners, then the wages you pay your daughter are not subject to FICA or Medicare.

  • Retirement Account Rollover

    Q: I got laid off from a job earlier this year. Now I’ve started my own business. I need to take money out of a retirement account that I had with my previous employer. Can I put the money into a retirement plan that’s designed for self-employed people? A: Yes, you can certainly roll the distribution from your retirement account into another qualified plan, such as an individual retirement arrangement (IRA) or simplified employee pension (SEP). You must complete the rollover bythe 60th day following the date thatyou receive the distribution from your previous retirement account. The financial institution where ...

  • Can I make withdrawls to my retirement account before age 62 without penalties?

    The key for the withdrawl penalty as to age is 59 1/2. If retirement withdrawals occur before that age, then the penalty could be applicable. But even if you are younger than 59 1/2, there is an IRS exception to the penalty if the distribution is after separation from service and the distributions are in a series of equal payments over the life of the participant. The IRS has a very good publication that can help with this detail called Publication 590, Individual Retirement Arrangements that discuss these options.

  • Can I Take The Home Office Deduction?

    Q. I have an apartment in Maryland in which I use half of the 2nd bedroom (converted to an office) for my graphic design business. The second half of the room contains my husband's things. Can I take a home office deduction? I use my part of the room exclusively for business. Basically, I just have a desk and a computer on my side of the room. I also was wondering if I did take the home office deduction, can you also deduct gas and electric according to the percentage of the apartment you are using for business? A. If ...

  • I recently set up an LLC for my new business. Which tax form do I need to file?

    The LLC will actually have to elect how it will be taxed for federal income tax purposes. If you are the only owner of the LLC, it can choose either to be taxed as a sole proprietorship or as a corporation. If there are more than one owners then the option is to be taxed as a partnership or as a corporation. Most small-business owners organized as an LLC choose to be taxed as a sole proprietorship or as a partnership and not as a corporation in order to maintain pass through taxation. If you are the only owner and ...

  • If I live in TN and work in TN, MS, and NY, do I pay the state income taxes in MS and NY even though I don't live there?

    If the income from the other states in indeed earned within that state then they will want their piece of the pie. You will need to file a non-resident income tax return in the other states and in effect pay their tax on the portion of your income earned within that state.

  • My husband is in graduate school. Can any of his tuition or textbook costs be deducted?

    Two tax credits, the Hope scholarship credit and the lifetime learning credit, are provided for education expenses. These credits generally are available for expenses incurred to pay tuition and related fees. the Hope scholarship credit is available only for more than half-time students, while the lifetime learning credit is available for a broader range of expenses. The credits are also limited if your adjusted gross income is at least $80,000 combined and are completely phased out at $100,000. The IRS has a very good publication to help you with this information, called "Publication 17: Your Federal Income Tax." Chapter 36 discusses the education credits. You can download this publication ...

  • Recording the business use of a vehicle

    Q: I understand there is a tax loophole for business owners that I am curious about. It states that if you purchase a new sport utility vehicle that weights more than 6,000 pounds, you can immediately deduct $20,000 of the cost and depreciate the rest faster than allowed under the regular rules for business vehicles. My question is this: Does this apply only to new vehicles, or does a used vehicle qualify for this deduction?    A: The first key point to your question is not that there is a tax loophole. It is the actual rules for recording the business use of a vehicle. There is ...

  • I just started my new business. Is there a list of all the business deductions I can take?

    Believe it or not, the IRS is the best place to start looking for possible deductions and for information to help you with your taxes. You can download forms with instructions and informative publications for free from their Web site at www.irs.gov. Some key publications for micro-businesses: Publication 334, Tax Guide for Small Business Publication 463, Travel, Entertainment, Gift, and Car Expenses Publication 505, Tax Withholding and Estimated Tax Publication 587, Business Use of Your Home Pay particular attention to Publication 587, which covers home office expenses, and Publication 463, which covers the expenses related to business use of your car. These ...

 

Disclaimer: The information provided on this website, including the statements and responses of the consultants, is of a general nature and is not intended as a substitute for consulting a professional. The best advice is to consult a professional in your area to make sure that your specific facts and circumstances are adequately reviewed. No attorney-client, accountant-client, or consultant- client relationship is intended or established. Your review or participation on this site is an acknowledgement of and agreement with the terms of this disclaimer.

 




Keith Hall - Keith Hall is a certified public accountant and the NASE National Tax Advisor. He operates a private tax and financial consulting firm in Dallas, Texas. Hall is one of the CPAs involved with NASE TaxTalk, where more than 10,000 small-business questions are answered every year. He has more than 21 years of consulting experience with small businesses, including more than 11 years working with the NASE.

Keith on Twitter
Keith on LinkedIn