It's crucial to know whether your workers are employees or independent contractors. Big dollars may be at stake in the form of federal and state assessed penalties resulting from misclassification. The validity of your company's pension plan may also be at stake.
A periodic review of the status of your workers to see if they are properly classified is critical, but the process isn't easy due to the complexity of the issue. To determine whether there is an employer – employee relationship or a business relationship, there are some factors to consider: the behavioral and financial control over the worker, ownership of the tools, the permanency of the relationship (is there a contract?), work location and work hours. There is no litmus test for exactly how many factors must be satisfied, nor are the factors uniformly applied.
If you'd like to discuss these complex rules with us and see how they apply to your business in order to make sure that none of your workers are misclassified, please call our office to arrange for an appointment.
There are situations when certain types of income are only partially taxed or not taxed at all. Some examples of non-taxable Income are:
Some income may be taxable under certain circumstances, but not taxable in other situations. Examples of items that may or may not be included in your taxable income are:
Due to Congressional action at year-end, taxpayers will need to wait to file until middle to late February if any of the following three categories apply:
Most people believe they are likely to live a long life past their 80s.
When you live a long life, you are more likely to need long-term care. Maybe you've seen this with an aging parent, a friend or a neighbor.
The real question then is "how will it impact your finances?".
Tax incentives are ow available to those who plan ahead.
Business Owners who plan now can take advantage of special tax incentives for tax-qualified long-term care insurance protection. Living a long life is likely. Planning for it is a real necessity and a smart financial move. Long-term care insurnce protection can be 100% tax deductible as a business expense. Plus, owners can choose who is covered, even spouses. Realize that it costs no more to work with an experienced professional. Your long-term care insurance agent can help you get the coverage that's best suited for you and your business.
In a nutshell, business owners can deduct the cost of long-term care insurance protection for themselves, for their spouses and sonetimes even teir parents on a favorable basis. You may use pre-tax corporate dollars to pay for your post-retirement asset protection.
A word of caution. Waiting can be a big mistake because you must "health qualify" for long-term care insurance coverage.
As the end of the year approaches, now is a good time for you to start planning for taxes by taking various actions that may save taxes for this year, next year, or both years. Act quickly to reap the most benefits—these strategies will be of no use after December 31.
Year-end planning always involves some educated guesswork, but this year poses a bigger challenge than most. With Republicans winning control of the U.S. House of Represen-tatives and picking up seats in the Senate, it is difficult to know exactly how tax changes will affect you.
Congress must decide whether to retroac-tively extend a number of tax provisions that expired at the end of 2009. In addition, without approval to extend the Bush tax cuts, individuals will face higher tax rates on their income, including capital gains. Unless Congress changes the rules, the estate tax, which isn't in effect this year, will return next year with a 55% top rate.
We have compiled a checklist of actions that can help you save tax dollars if you act before year end. These moves may benefit you regardless of what the lame duck Congress does on the major tax questions of the day. Not all actions will apply in your particular situation, so please review the following list and contact us so that we can advise you on which tax saving moves to make.
Year-End Moves for Individuals
Year-End Moves for Business Owners
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