Owning Investment Real Estate through Single Member LLCs

 

Over the years, Single Member LLCs (SMLLCs) have grown in popularity among investors and business owners because under the so-called check-the-box regulations, you can generally ignore the existence of a SMLLC for federal tax purposes.  When you choose to not treat a SMLLC as a corporation for federal income tax purposes, the entity is disregarded (i.e., it’s a “nothing” for federal income tax purposes).  The federal income tax treatment of a disregarded SMLLC is relatively simple because its activities are considered to be conducted directly by the SMLLC’s sole member (owner).  For instance, when an individual uses a disregarded SMLLC to own rental real estate, the rental activity is reported on Schedule E of Form 1040.  There is no need to file a separate federal income tax return for the […]

By |July 1st, 2022|Categories: BCo Community News, Business Operations, Business Tax|Comments Off on Owning Investment Real Estate through Single Member LLCs

Non-Profits and the Employee Retention Credit

 

The employee retention credit (ERC) is a form of government assistance created under the Coronavirus Aid, Relief and Economic Security (CARES) Act to help businesses and organizations keep employees on their payroll during the pandemic.  While the credit provided an opportunity for substantial savings for non-profit organizations, these organizations now need to properly account for this credit.

A non-profit employer is eligible if the organization:

  • Experienced a full or partial suspension of operations because of a government-ordered shutdown during 2020 or 2021.
  • Experienced a decline in revenue of more than 50% during 2020 or 2021 compared to the same quarter of the year prior.

Cumulatively, eligible employers could receive a refund of up to $5,000 in 2020 and up to $7,000 in 2021, per employee per quarter.

While the ERTC was initially set […]

By |June 16th, 2022|Categories: Accounting & Bookkeeping, Nonprofit Organizations|Comments Off on Non-Profits and the Employee Retention Credit

CalSavers Retirement Savings Program Final Registration Deadline is June 30, 2022

 

The CalSavers Retirement Savings Program is a by-product of state-mandated retirement legislation that was launched in July 2019 as part of a phased rollout over three years with the goal of improving the financial security of Californians working in the private sector. It is sponsored by the State of California, facilitated by businesses, and funded by employee savings.

This rollout phase applies to employers with 5 or more employees who do not offer a retirement savings plan, self-employed individuals, and others who want to save extra. Savers participate by contributing to a Roth Individual Retirement Account (IRA) that belongs to them via payroll deductions on a post-tax basis. An option is also available for CalSavers participants who want to recharacterize their account to a traditional IRA where contributions are made on […]

By |June 16th, 2022|Categories: Announcements, Retirement Planning|Comments Off on CalSavers Retirement Savings Program Final Registration Deadline is June 30, 2022

IRS Increases Mileage Rate for Remainder of 2022

The high cost of gasoline has prompted the IRS to make a mid-year adjustment to the standard mileage rate for business travel effective July 1, 2022.  The norm has always been to make this adjustment annually.  The last time the agency made a mid-year adjustment to the rate was in 2011. The new rate will be 62.5 cents per mile, an increase of 4 cents from the prior amount.  For more information please click here.

By |June 15th, 2022|Categories: Announcements, IRS|Comments Off on IRS Increases Mileage Rate for Remainder of 2022

IRS Interest Rates Increase for the Third Quarter of 2022

 

As interest rates rise across the board so does the IRS underpayment penalty rate for estimated taxes. The rate is scheduled to increase from 4% to 5% starting on July 1, 2022.  With the rising rates, it becomes more important to make estimated tax payments accurately and on time.  For the official IRS announcement see the following news release here.

By |May 20th, 2022|Categories: IRS|Comments Off on IRS Interest Rates Increase for the Third Quarter of 2022
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