Taxation Issues in the Gig Economy

September 24, 2019

Mobile apps and online platforms have revolutionized the way many businesses offer services to consumers. Examples of the so-called “Gig” economy are widespread – from ride sharing and vacation rentals to on-demand housekeeping and legal advice. If you decide to jump on the sharing economy bandwagon, it’s important to understand the tax rules for recognizing income, making estimated payments and deducting legitimate business expenses.

Do you provide car rides through a mobile app, rent out your spare room using an online platform or repair computers for local businesses on demand? If so, you may be considered part of the “gig economy” or the “sharing economy.”

Participation in this emerging method of distributing services can be a good way to earn money in your down time, pursue a more flexible lifestyle and provide cash to offset the expenses associated with owning a vehicle or a home. The IRS recently offered some guidance for this rising trend. Here’s a summary of the key points. Read more

What is this ITIN you ask about?

April 25, 2019

By Bethany Bouw, CPA

Tax season is upon us all which means it is time for those with filing requirements to file their tax returns. Filers with Social Security numbers can file their returns with no concerns about the return being processed to the correct account. The social security number means that the tax information filings and tax returns are tracked to that number. “The process is not as straightforward for those who are ineligible to receive a social security number. There is a specific process for getting an identifying number.

Ineligible for a Social Security Number (SSN)

There is an answer for those that have need of an identifying number for US tax purposes and are ineligible for a SSN. The US government allows for filing a request for an IRS Individual Taxpayer Identification Number (ITIN). The ITIN can be used in place of a SSN to file the US tax return. The applicant can be either a resident alien or a non-resident alien. Both resident and non-resident could need to file to be compliant with US tax law. This number is to be used only for federal tax purposes. The ITIN does not equate to work permission, eligibility for social security, or work for earned income tax credit purposes. Those who are eligible for a SSN are ineligible for an ITIN.

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TCJA Depreciation and Other Deduction Changes

February 12, 2019

By Jason Dudas, CPA

Under the Tax Cuts and Jobs Act, contractors are now able to take a deduction for the full cost of machinery and equipment purchase made each year. This new provision is referred to as 100% bonus depreciation and there is no limitation on the amount of purchases. The provision is available for assets acquired and placed-in-service after September 27, 2017.

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Gender-Based Pay Discrimination Allegations: Is Your Business Vulnerable?

December 19, 2018
Pay Discrimination

Many employers are unsure about what constitutes pay discrimination in the eyes of courts and the EEOC.

Laws and regulations governing gender-based pay equality have been on the books for decades. But equal pay for men and women has become a hot button in the business world, thanks to the #MeToo movement and some recent surveys documenting widespread pay disparity.

Recent Equal Employment Opportunity Commission (EEOC) gender-based discrimination allegations suggest that many employers are unclear about what constitutes pay discrimination in the eyes of courts and regulators. While it can be a gray area, it’s important to know the basics to help you assess your risk of an EEOC equal pay claim- and take preventive measures to protect your company and it’s employees.  Read more

Tread Carefully When Renting Space

December 12, 2018
Medical fraud

Office spaces being rented between physicians and medical suppliers are getting more attention for potentially fraudulent activity and kickbacks.

As you know, medical practitioners are subject to a federal law that makes it a felony to influence the referral of federal health care business, including Medicare and Medicaid.

For example, if a physician refers a patient to a specialist and receives part of the specialist’s Medicare payment in exchange, the doctor has committed a felony under the Anti-Kickback Statute and could be subject to criminal and civil charges. The physician could also be excluded from Medicare and other federally funded health care programs. Read more

Foreign Tax Technical Update- Section 956

December 11, 2018

PROPOSED REGULATIONS REDUCING THE AMOUNT DETERMINED UNDER SECTION 956 WITH RESPECT TO CERTAIN DOMESTIC CORPORATIONS ISSUED

Summary

On October 31, the Department of the Treasury and the Internal Revenue Service (collectively, Treasury) issued proposed regulations under Section 956, Investment of earnings in United States property, (the Proposed Regulations). The Proposed Regulations reduce the amount determined under Section 956 with respect to certain domestic corporations that own (or are treated as owning) stock in foreign corporations. Read more

DOL Pitches Auto-Portability Program to Preserve Retirement Savings

December 11, 2018

Auto-PortabilityThe U.S. Department of Labor (DOL) is advancing a proposal that would enable 401(k) plan sponsors to automatically transfer account balances up to $5,000 of former participants who have left the company. The amounts would be transferred to the 401(k) plan of an employee’s new employer. Assets transferred using this “auto portability” approach would make an intermediate pit stop in an IRA before landing in the former employee’s new employer’s plan. Here’s what you need to know. Read more

Own a CFC? Get Ready to be GILTI…

December 7, 2018

There have been many changes in the last 12 months for US taxation of foreign entities. US shareholders of controlled foreign corporations (CFCs) have already felt the pinch of transition tax for 2017. Unfortunately, the pinch of foreign taxation changes is going to continue in 2018 and onwards thanks in part to GILTI. As the acronyms connotation implies, it is a less than popular tax change. Let us look together at some significant points related to the ominous GILTI: Read more

Lock in Home Office Deductions

December 5, 2018

Home Office DeductionsThe tax law permits you to deduct home office expenses if you “regularly and exclusively” use an area of your home as either:

  • Your principal place of business.
  • A place to meet or deal with clients, customers or patients in the normal course of business.

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