With an employee stock ownership plan (ESOP), employee participants take part ownership of the business through a retirement savings arrangement. Meanwhile, the business and its existing owners can benefit from some potential tax breaks, an extra-motivated workforce...
Now that we’ve hit midsummer, if you own a vacation home that you both rent out and use personally, it’s a good time to review the potential tax consequences: If you rent it out for less than 15 days: You don’t have to report the income. But expenses associated with...
According to IRS Publication 5137, Fringe Benefit Guide, a fringe benefit is “a form of pay (including property, services, cash or cash equivalent), in addition to stated pay, for the performance of services.” But the tax treatment of a fringe benefit can vary...
It’s common for a business to own not only typical business assets, such as equipment, inventory, and furnishings, but also the building where the business operates — and possibly other real estate as well. There can, however, be negative consequences when a...
Donating to charity is more than good business citizenship; it can also save tax. Here are three lesser-known federal income tax breaks for charitable donations by businesses. Food donations Charitable write-offs for donated food (such as by restaurants and grocery...
The federal Small Business Administration reports that about 75% of small business owners donate some portion of their profits to charity each year. The average contribution is around 6% of earnings. Fulfilling philanthropic intentions has emotional rewards. And there...
It’s common for closely held businesses to transfer money into and out of the company, often in the form of a loan. However, the IRS looks closely at such transactions. Are they truly loans, or actually compensation, distributions or contributions to equity? Loans to...
If your employees incur work-related travel expenses, small businesses can tax-efficiently reimburse employee travel costs by using the right method. But to secure tax-advantaged treatment for your business and your employees, it’s critical to comply with IRS rules....
Among major corporations, 401(k) plans have become common. But even the smallest of businesses can have a 401(k) plan for retirement. One-participant 401(k) plans, known by names such as Solo 401(k) and Uni-k, are available. For some small business owners and...
In today’s competitive environment, offering employees an equity interest in your small business can be a powerful tool for attracting, retaining and motivating quality talent. If your business is organized as a partnership, however, there are some tax traps you...
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