The Small Business Tax Help Blog

Posts Tagged ‘irs’

Question: Can shareholders of a Bankrupt company take over the shell of the corporation even though it is still in BK?

A group of shareholders of a Bankrupt California Corporation (which has been suspended for over five years by the Secretary of States office) would like to reinstate the corporation, change the name of the corporation, change the EIN # and merge a new company into it even though a final disposition of its bankruptcy case has not been issued. Can the shareholders do this without reprocussions from the Bankruptcy Judge. I am just so so tired of the shareholders getting pooped on during a bankruptcy. We will be left with nothing unless we take matters into our own hands.

Answer: No. As long as it's in BK you can't do anything. Approach the presiding court, that's your only possibility.

The Fiver | Chicken-Hearted Charges; and The All-English Firing Line Of Doom | Paul Doyle and Simon Burnton

Click here to have the Fiver delivered direct to your inbox every weekday at 12pm(ish), or if your usual copy has stopped arriving SHAME DUCKS Maybe it was because he's constantly aghast at being a ringer for Squidward from Spongebob Squarepants (and, therefore, for Mike Riley), but the Fiver suspects that the real reason Giorgio Chiellini spent much of the World Cup flinging himself to the ...

Loose Change, 2nd E. part 1 German subbed

Question: How will my current income be effected if I register an ABN and begin running a small business on the side?

(Australia)

I work a full-time job as an employee.

I want to hold CM craft workshops on the side to help me pay off some debts. I believe I will need to register an ABN so I can purchase and make sales of goods.

How will the income (though not very sizeable) effect my current income – will I be taxed more for earning more, or might the costs and running fees of the business offset the tax.

Yep, I need to see an accountant – but just looking for basic advice here first so I can get a basic understanding.

Answer: It all depends if you are making a profit with your business. If there is an accounting profit it will be added to your wages, and you will have to pay tax at the appropriate tax rate. You should budget for this during the year so you don't get caught out at tax time.

If your business is making an accounting loss, i would assume based on what you've said that you would not be able to offset this against your income, but instead it would carry forward to offset any future profits. In this case your tax situation would be similar to how it is currently. There are some situations where you can offset losses against your wages, but you would need to speak to your accountant about your specific circumstances.

Speak to your accountant before starting the business or getting your ABN, as by setting the business up a certain way, you may be able to save more tax. Also check if you need to register for GST as this may mean some extra work for you, completing BAS's etc.

Good luck with your venture.

Cumberland County briefs - Princess Party, Tax workshop

The South Jersey Healthcare (SJH) Auxiliary will host its annual Princess Party on Saturday, March 6, from 10-11:30 a.m. and 1-2:30 p.m. at the SJH Fitness Connection Community Room at Sherman Avenue and Orchard Road, in Vineland.

eBay Workshop Announcement: 10/24/2006 @ 11am PST

Question: What happens if you have a S Corp. (small business) and you miss the end of year tax filing? (March 17th)?

Internet Explorer crashed and I lost my filings for Forms 1120S, F4562… I don’t think I’ll be able to make today’s March 17th filing for corporations. What happens? Do I need to notify anyone?

Answer: File an extension, form 7004.

Rendell Budget Would Revamp Pennsylvania Business Tax (Update2)

Feb. 9 (Bloomberg) -- Pennsylvania Governor Edward Rendell , serving his final year as governor of the U.S.’s sixth most- populous state, presented a $29 billion budget and proposed an overhaul of state sales and Business Taxes because of the expected loss of federal stimulus aid.

{Income Tax Savings} This VIDEO Will Save You $7,234 Per Year In Your Home Based Business!

Question: Question about federal Tax Withholding?

My husband claims 5 dependents on his federal income tax return however throughout the year he claims 2 on his paycheck. He is expecting a $10,000 bonus check next month so my question id should he change his withholding to 5 dependents just for the bonus then go back to 2 for the rest of the year so they do not take out a huge chunk in taxes. In 2007 he made $36,500 he is expecting to make between $50,000 – $55,000 in 2008. We usually get back about $7.500 in tax refund. So if he claims 5 dependents for the bonus check will it just kinda break even as far as tax refund next year? Any help with this would be great thanks
his bonus last year was $3500 and he brought home $2236.00 if that help any

Answer: Legally they are supposed to withhold taxes at the statutory minimum rate of 25% for all bonuses and other irregular payments. If they follow the law it won't matter what he puts on his W-4, at least 25% MUST be withheld. Plus FICA and state income taxes as well.

Credit to hit some in pocketbook

A program launched by the federal government in 2009 to put a little more money into people’s pockets during tough economic times will continue this year, and like last year, some taxpayers might find that less tax is being withheld than they prefer, according to the Internal Revenue Service.

Question: Section 179 deduction -determining business income limitation?

So this is the first year we are doing a Scedule C. We have an operating loss, plus about 6,500 worth of equipment we want to depriciate and we are considering the section 179 deduction.

On line 11 of Form 4562, it tells you to enter the smaller of business income or line 5 (the 108,000 annual limit). When you go into the instructions for line 11, they tell you to start with business income and add wages earned as an employee from line 7 of the 1040.

So I have come to the conclusion that our w2 income from our employers can be used to determine the limit on line 11 of 4562. But I wanted to see if any other tax people out there agree. Can you claim the Sec 179 expense deduction even if you have no business income as long as you have enough W-2 earned income?

Thanks
I said 108,000 above, but just noticed I was looking at the 06 tax form. I realize that the 07 limit is 125,000.

Answer: Well the total on your 4562 gets carried to your Schedule C line 13 so you will end up with a business loss which carries to your 1040 line 12. Yes that 179 limit includes all income - not just your business income. Why would you want to take the entire deduction instead of depreciating and having deductions for years. What will you use next year then? If your new business does not generate a reasonable profit for 3 out of 5 years then the IRS can reclassify it as a hobby and disallow any losses. Keep that in mind as you decide how to proceed. In case you weren't aware - you can just select a portion to 179 and depreciate the balance.

Business entertainment deductions: fun but complex

Taking a client out for lunch is one of the most basic business activities there is. And it's one that can run a small business owner afoul of the IRS.

Income Tax for Small Business