Welcome to this month's edition of the Tax and Business Alert. Our goal is to provide
you with current articles on various tax and business topics. The articles are
intended to keep you up to date on trends and issues that may impact your business
and personal financial affairs. Please contact us if you have questions about any of
the issues discussed.
CONTEMPORANEOUS RECORDKEEPING KEY TO AVOIDING LOSS LIMITATIONS
Taxpayers who run up tax losses in a business must be prepared to prove that one of
the material participation tests was passed to avoid having the losses characterized
as a passive activity loss (PAL) that cannot be currently deducted. In general, an
individual taxpayer can meet the material participation standard by passing one of
seven tests outlined in the regulations and described in this article.
SPECIAL RULES FOR INHERITED IRAS
Normally, retirement plan distributions made to a nonspouse beneficiary after the
account owner's death are taxable at the time they are received and cannot be rolled
over to the beneficiary's own IRA. However, employer-sponsored retirement plans are
required to offer nonspouse beneficiaries the option to roll over inherited amounts
tax-free in a direct rollover to an inherited IRA. This article lists the special
rules that apply to an inherited IRA.
AVOID GIFT TREATMENT BY PAYING EXPENSES DIRECTLY
It may seem easy to give money to relatives for educational or medical purposes, but
doing so can result in a tax hit. This article explains why it's important to make
any payment directly to the organization or service provider.
This article mentions a couple of important tax deadlines for April and June.
SEPS - ONE LAST CHANCE TO LOWER YOUR 2014 TAX BILL
Simplified Employee Pension (SEP) plans are available to self-employed individuals,
partnerships (including multimember LLCs treated as partnerships), and corporate
employers alike. Unlike other types of retirement plans, a newly formed SEP is easy
to establish and a powerful retroactive tax planning tool. This article discusses how
a SEP works and the requirements involved in forming one.
WHAT LANDLORDS SHOULD KNOW ABOUT RENTAL INCOME AND EXPENSES
Accounting for rental income might at first seem like a simple concept, but in
practice it may not be so simple. What is the difference between "rental income" and
"advance rent"? How does one account for a security deposit, or property or services
received in lieu of rent? How is personal use of a vacation home or other rental
property treated? This article addresses those questions.
This publication is distributed with the understanding that the author, publisher and
distributor are not rendering legal, accounting or other professional advice or
opinions on specific facts or matters, and, accordingly, assume no liability
whatsoever in connection with its use. The information contained in this newsletter
was not intended or written to be used and cannot be used for the purpose of (1)
avoiding tax-related penalties prescribed by the Internal Revenue Code or (2)
promoting or marketing any tax-related matter addressed herein. © 2015