Irvine Tax Solutions

The goal of tax planning is to arrange your financial affairs in order to minimize your taxes. Here are three tax-cutting strategies that you could make: 1. Earn as much nontaxable income as possible. You have more control over business and investment income than any other income you earn. You can draw income from your business in the form of tax-deferred and tax-free benefits. And you can grow and draw income from your portfolio in all sorts of tax-advantaged ways. This syst

Preparing your own business tax return, especially for the first time, can be a frustrating experience if you don't have all the necessary information at your fingertips. Gathering certain documents before you begin will help you fend off the frustration. Here's a list of items you may find helpful when preparing your business tax return: Business information Last year's business tax return Articles of incorporation Partnership agreement Accounting records Bank statements Cre

Bonuses are considered excellent way to motivate employees and reward top performers; however, they can also quickly change one’s tax return and the amount of taxes initially withheld depending on the payout. IRS regards bonuses as supplemental wages, which are not regular wages. For more details, see Publication 15 (2017), (Circular E), Employer’s Tax Guide for the tax year in question. There are two ways of withholding taxes from bonus: The aggregate method: is used when em

If you want to pay the least amount of income tax each year, then it may be helpful to start doing some tax planning. Don’t worry - you don’t need an accounting degree to make some smart tax decisions. A little planning goes a long way. Step 1: Start a filing system Start a filing system to organize your documents. Any successful tax planning strategy requires you to maintain records of all transactions and receipts that may affect your tax return. This helps to keep track of

The IRS allows you to deduct a certain amount of medical expenses if you itemize deductions. Qualified medical deductions are expenses you paid during the tax year for yourself, your spouse, or your dependents. Here is a list of Qualified Medical Deductions that apply to you: abortion, acupuncture, addiction treatment, ambulance service, annual physical examination, artificial teeth, autoette bandage, blood sugar test kit, body scan, breast pumps, breast reconstruction surger

In recent years, thousands of people have lost millions of dollars and their personal information to tax scams and fake IRS communication. Scammers use the regular mail, telephone, fax or email to set up their victims. This page looks at the different scams affecting individuals, and businesses. 1 IRS-Impersonation Telephone Scams An aggressive and sophisticated phone scam targeting taxpayers, including recent immigrants, has been making the rounds throughout the country. Cal

The IRS has issued the 2018 optional standard mileage rates and starting on January 1, 2018, the standard mileage rates for the use of a car, van, pickup or panel truck will be: 54.5 cents per mile for business miles driven (up from 53.5 cents in 2017) 18 cents per mile driven for medical or moving purposes (up from 17 cents in 2017) 14 cents per mile driven in service of charitable organizations (currently fixed by Congress) 25 cents per mile is the depreciation on the vehic

Well-organized records make it easier to prepare a tax return and help provide answers if your return is selected for examination or if you receive an IRS notice. You must keep records, such as receipts, canceled checks, and other documents supporting an item of income, a deduction, a credit appearing on a return, etc. Here are the list of a handful of tips. 1. Go paperless with online bank account statements - perhaps even copies of cancelled checks and deposit records 2. Ga

Tax refunds can feel like Christmas in springtime. With a sudden boost to your bank account, you can look forward to going on a shopping spree, catching up on debt or squirreling the refund away in savings. These days, you can even anticipate when your windfall will arrive by tracking the status of your refund with the Refund Status tool available from the IRS online. For those receiving minimal refunds, the celebration can be less like real bubbly and more like club soda. Bu

Bonuses are considered excellent way to motivate employees and reward top performers; however, they can also quickly change one’s tax return and the amount of taxes initially withheld depending on the payout. IRS regards bonuses as supplemental wages, which are not regular wages. For more details, see Publication 15 (2017), (Circular E), Employer’s Tax Guide for the tax year in question. There are two ways of withholding taxes from bonus: The aggregate method: is used when em

The tax season is here again! This year, the IRS announced 4 recent changes in tax laws that can save you a lot. 1. Individual Income Tax The IRS has increased the standard deduction, which can increase your taxable income. New tax brackets in 2020: The current standard deduction is $12,400 for singles, up from $12,200 in the prior year, and $24,800 for married joint filers, up from $24,400 in 2019. 2. Retirement savings contribution limits The IRS has raised the employee co

The Electoral College has confirmed new president-elect making great changes next year. For now, we still need to keep track of the routine things involved in bookkeeping and tax. Here are some quick steps: 1. Make charitable contributions before year-end This is an exceptional way to reduce your tax burden for the year as well. Remember to look up the charity to see what they do with your donations. Also, the IRS imposes several rules for claiming a deduction for donation: P

Business filing deadlines depend on a number of variables including the business structure the company uses. A non-calendar year fiscal year also impacts the due date. Therefore, business tax filings due dates can vary widely. However, the initial due date for most business tax returns is March 15 or April 15. Sole Proprietors and Single Member LLCs Sole proprietors and single member LLCs that use the default disregarded entity status must complete Schedule C or Schedule E an

With the extended 2017 tax filing season drawing to a close, now is the time to act promptly if you still need to claim a tax refund. Your preparer may take information directly from you or ask you to complete a questionnaire. Either way, you’ll need time to collect and organize the information. Here are 10 steps to take before meeting for your tax prep. 1. Choose a preparer Hiring a professional – trustworthy tax preparer is actually important. Be sure that the person you ch

It is essential that business owners correctly determine whether the individuals providing services are employees or independent contractors. Basically, you must withhold income taxes, withhold and pay Social Security and Medicare taxes, and pay unemployment tax on wages paid to an employee. You do not generally have to withhold or pay any taxes on payments to independent contractors. Before you can determine how to treat payments you make for services, you must first know th

Not everyone is required to file an income tax return each year. Generally, if your total income for the year doesn't exceed certain thresholds, then you don't need to file a federal tax return. Consider your gross income thresholds Most taxpayers are eligible to take the standard deduction. The standard tax deduction amounts that you're eligible for are primarily determined by your age and filing status. The standard deduction, along with other available deductions, reduces

Taxes are a necessary evil - the price we pay for roads, bridges, schools and law enforcement. Audits, on the other hand, feel just plain evil. In an effort to thwart fraud, the Internal Revenue Service audits about one percent of U.S. taxpayers every year. IRS computers are programmed to catch outliers and oddities on returns; any item that falls outside the norm may be flagged so that an IRS employee can review it to see if there's actually a need for an audit. Common red f

IRS has published “Notice 2014-21” describing how existing general tax principles apply to transactions using virtual currency. Here are a handful of primary contents of this notice. 1. For federal tax purposes, virtual currency is treated as property. General tax principles applicable to property transactions apply to transactions using virtual currency. 2. Under currently applicable law, virtual currency is NOT treated as currency that could generate foreign currency gain

Knowing where you fall matters a lot when it comes to filing your taxes. Specifically, if you’re an employee, the company you’re working for is responsible for withholding taxes throughout the year, as well as costs like the employer’s share of Social Security and unemployment taxes. If you’re an independent contractor, you’ll need to be paying quarterly taxes and will be fully responsible for those additional tax costs. It's not as easy as just looking at how many hours you

Normally, taxes are due by April 15 every year, unless that date falls out on a weekend or holiday, in which case it's pushed back a number of days. However, due to the impact of COVID-19, the White House declared to change the tax deadline and announced some changes based on this global-illness disaster. Your payment to the IRS can defer If you owe a payment to the IRS, you can defer up to $1 million as an individual. adding that the payments would be interest free and penal