Business Operations

Helping S Corporations Avoid Unreasonable Compensation Audits

Since compensation is subject to employment taxes (i.e., primarily Social Security and Medicare taxes) and distributions to shareholders are not, many S corporation owners reduce their compensation and increase their shareholder distributions in an attempt to avoid the employment taxes.   In some cases this is justifiable, and in some it is not.  The IRS is well aware of this issue; in fact, one of the IRS’s hottest audit triggers for S corporations is insufficient compensation paid to employee-shareholders.

The Journal of Accountancy recently published an article that provides nine steps to help S corporations reduce the likelihood of an IRS examination for unreasonable owner compensation.  Read the article here.

 

By |May 17th, 2016|Categories: BCo Community News, Business Operations, Business Tax, IRS|Tags: , , , |Comments Off on Helping S Corporations Avoid Unreasonable Compensation Audits

2015 Tax Planning Guide

New Year 2015 And Clock

 

Our 2015 Tax Planning Guide is now available. This online guide will give you access to updated tax and financial planning information throughout the year. Feel free to forward it to friends and family who you think might find it interesting or helpful. We hope this guide will prove to be a convenient resource for you throughout the year. Just a few of the topics covered in the guide are:

 

  • Roth IRA conversions
  • Bunching income and expenses as a year-end planning strategy
  • Planning for restricted stock and stock options
  • Planning for real estate investments
  • Succession and retirement planning for business owners
  • Charitable giving strategies

 

If you have any questions after reviewing the information presented, please do not hesitate to […]

GO-Biz Launches California Business Portal

In July 2015, the California Governor’s Office of Business and Economic Development (GO-Biz) launched the California Business Portal, a one-stop website for business owners to find information and assistance regarding operating a business in the state of California.  It provides information to business owners regarding starting a new business, obtaining permits and licenses, various tax incentives, local resources and more.  Click here to view the new portal.

Affordable Care Act Employer Reporting Requirements for 2015

As part of the continued roll out of the Affordable Care Act, beginning in 2015 large employers must file Forms 1094-C and 1095-C with the IRS.  A large employer is typically one with 50 or more full-time and full-time equivalent employees.  The information returns are due by February 29, 2016 or March 31, 2016 if filing electronically.

  • Form 1094-C, Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns

 

  • Form 1095-C, Employer-Provided Health Insurance Offer and Coverage

 

Even though employers with 50 to 99 full-time employers are not subject to the employer mandate for health insurance coverage until 2016, they are still required to comply with the reporting requirements for 2015.  Additional information can be found on IRS.gov.

By |August 18th, 2015|Categories: Business Operations, Business Tax, IRS|Tags: , , , , , , , , , , |Comments Off on Affordable Care Act Employer Reporting Requirements for 2015

Reimbursement of Employee Health Insurance Premiums (Including S Corporation Shareholders)

A little known and very under-publicized change to the insurance tax laws that took place on January 1, 2014, has exposed employers to a potentially heavy excise tax if they reimburse employees for health insurance premiums vs. enrolling in group plans.  This includes employee shareholders.

Employer reimbursements or direct payment of health insurance premiums for individual policies or coverage under a spouse’s policy may be deemed a group health plan subject to the Affordable Care Act’s (ACA) market reforms if they are made for more than 1 employee.  The deemed group health plan would not comply with the ACA’s benefit mandates for group health coverage and would be subject to excise taxes of $100 per day, per employee with no limit.

While the new […]

By |August 18th, 2015|Categories: Business Operations, Business Tax|Tags: , , , , , , , , , , , , |Comments Off on Reimbursement of Employee Health Insurance Premiums (Including S Corporation Shareholders)