I’m a Service Company and Formed an LLC. Should I Make an S Corporation Election?

I’m a Service Company and Formed an LLC. Should I Make an S Corporation Election By Stephen J. Ganns, CPA{2:42 minutes to read} Twenty years ago, your choices when forming a company were basically to incorporate or not. Now we have an entity called LLC. However, the IRS does not recognize LLCs as business entities.

  • A 1-person LLC files as if it were a sole proprietor.
  • A multiple person LLC (or LLP) files as a partnership.

LLCs  and LLPs can, however, elect to be taxed as a corporation, which then puts them into the situation where the owners must decide if they are going to be a regular C corporation or an S corporation. Continue reading

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Which Business Entity Is Right for You?

Which Business Entity Is Right for You By Stephen J. Ganns{3:42 minutes to read} Starting a business? What type of business entity should you be? For a small business person, there are various types of entities that can be the vehicle you need to run your business.

Corporation

There are 2 types of corporations: a C-Corporation (C-Corp) or an S-Corporation (S-Corp). Continue reading

Job Hunting and the IRS

Job Hunting and the IRS By Stephen J. Ganns{3:18 minutes to read}  

If you’re looking for a job, surprisingly, some of the expenses may be deductible. The IRS allows a deduction for searching for a new job, however, as always, there are some restrictions.

Some of the costs or expenses you can deduct are:

  • Resume – all costs involved in preparing, printing and mailing resumes
  • Travel –  to look for jobs in another city; also includes local travel, subways or metros, taxis
  • Overnight stay expenses for interview purposes
  • Placement agency fees. 

Continue reading

3 Simple Tax Effects of Divorce and Separation

3 Simple Tax Effects of Divorce and Separation By Stephen J. Ganns{3:00 minutes to read} We all know one of the most significant, life changing events many people go through is separation or divorce. At that time, income taxes may not be your number one priority, but here are some quick tips to remember as you navigate these waters.

Child Support

If you are paying child support, it is not deductible on your tax return. People often get confused by this, but if you think it through, it’s pretty simple. When a married couple buys clothing or school supplies for their children, they cannot deduct those purchases, so just because you give those funds to an ex-spouse doesn’t make them deductible. Continue reading

Is Your Family Living on a Budget or Practicing “Creative Finance?”

Is Your Family Living on a Budget or Practicing {3:06 minutes to read} Throughout my career, I have seen many of my clients flourish and others, unfortunately, not. Whether a business or family flourishes has to do with a great many factors. However, one of the things I’ve noticed is that an abundance of the people who ended up struggling did so because they had very little idea of what it cost them to live on a day-to-day, month-to-month, year-to-year basis.

It’s made me think that maybe I should talk more to my clients about the value of budgeting, so today we are going to focus on:

  • Personal budgeting

The most important thing I can say to you is that you cannot, I repeat, you cannot live on more than what you make. This is very important considering the number of people in the last few years that fell behind in mortgage payments and are far in debt to credit cards. I understand that an unexpected event (disability, sickness, losing a job, etc.) can cause a financial hardship even to the best of budgeters. But living within one’s means will make one better prepared for those life events we cannot control. Continue reading

Though Hard to Believe, Children CAN Sometimes Save You Money

Though Hard to Believe, Children CAN Sometimes Save You Money by Stephen J. Ganns{3:42 minutes to read} If you are a working parent or a parent looking for work, you will probably need to pay for childcare. These expenses could qualify for a tax credit that could reduce your federal and state income taxes.

The credit is commonly referred to as the Child Dependant Care Credit, but like everything else in the tax code, it is subject to certain regulations. Continue reading

Independent Contractor or Employee – Which Are You?

Independent Contractor or Employee - Which Are You? by Stephen J. Ganns, CPA{3:48 minutes to read} The IRS is becoming more and more strict about how employers categorize their workers, as to whether they are independent contractors or employees.

There are basically 3 areas that the IRS considers when deciding if a person is an employee or an independent contractor. Continue reading

Are You Keeping Track of Your Auto Expenses in Writing?

Are You Keeping Track of Your Auto Expenses in Writing By Stephen J. Ganns{3:00 minutes to read}  If you own a small business there is a good chance that you are using a personal automobile for that business. In fact, you may even have purchased the automobile through the small business.

In either case, you are now faced with the daunting task of keeping proper records. The IRS demands that in order to deduct automobile expenses for a business you must have WRITTEN documentation, this documentation must be kept contemporaneously at or around the time of the expense. Continue reading

Small Business Record Keeping

Small Business Record Keeping By Stephen J. Ganns, CPA{3:48 minutes to read} We often get questions at our accounting firm from our clients, especially our small business clients, regarding what kind of records they should keep, how they should keep them, and so forth.

Many times with a small business, either the owner keeps their own records, or their spouse/significant other keeps the records. These people may be trained in their own business, but not necessarily in record keeping. Continue reading

Letter from the IRS? Don’t Panic!

Letter from the IRS? Don't Panic! By Stephen J. Ganns, CPA{3:48 minutes to read} The IRS mails many notices and letters to taxpayers each year. There are a variety of reasons why this might happen. Here are some things you should know in case you receive one.

First, do not panic. You can often take care of any notice by simply responding to it. The IRS notice will usually be about a specific issue on your Federal tax return and/or tax account, such as:  Continue reading