Loading...

Wednesday, July 23, 2014

Staying Ahead of Your Business Taxes

We're nearly half way into 2014: Exactly where does your business enterprise fill in with regards to taxes?



Earlier this month, a customer of mine got an awful revelation when I completed his federal tax return and disclosed he owed a load of cash to the Internal Revenue Service. His original feeling was to get upset at the runner. But, upon thoughtful consideration, he declared," Very well, I ought to have come to hire you before now when my brand new item blasted off the way it did. I understood I was without a doubt recieving a bunch more cash".

He's absolutely right. Each time there is a considerable modification to your operation's revenue (in either red or black), it's time for a visit to your tax planner. In reality, any person which runs a business ought to capitalize on the mid-year off period to sit down with a tax advisor to review their financial records and potential tax liabilities. It's far simpler to formulate and put a plan of action in position now than to run around at tax season upending pails of water on all the small fires that have been growing all year.

Here are some suggestions to go over with your tax pro to bolster your tax situation, reducing your liability and with some luck keep operating cash in your account rather than in Uncle Sam's wallet.

Launch a retirement strategy.

When you're ultimately a few dollars ahead and don't possess a retirement fund, right now's time to start one. Here's the reward: it's deductible!

Consult with an authentic financial advisor or a representative from your credit union to identify whatkind of program best fits your demands.

There are a large range of vehicles from Individual 401(k) plans to SEP IRAs to SIMPLE plans that may or may not call for you to include personnels in the plan.

On the occasion that a program necessitates employee participation, do not immediately suspend it.

Opening a retirement plan for your workers might be a meaningful means to offer raises that don't necessitate the extra cost of business paid payroll tax bills. Read through Internal Revenue Service Magazine 560 to find out more.

Examine your legal framework.

Make the effort to review whether your business is running efficiently in its already existing company framework. You could have started as a sole proprietorship and have already outgrown it. It is most especially important to assess entity structure if your company is now making over $100,000 per year.

Always remember that if your company incorporate, you will definitely now be mandated to get funds out of the business by means of pay-roll as opposed to simple draws.

There is a lot more documentation included under this status, but the tax advantages and safeguards that a corporation supplies may prove to be more advantageous.

Consistently go over these options with your legal professional and tax expert prior to making a decision.



Offer employee benefits.

Staff members are our most significant company asset and should be dealt with properly. There are numerous employee perks which are not taxable to either the staff or the business. Look into Internal Revenue Service Brochure 15-B, Guide to Fringe Benefits to read more concerning this particular topic. You will certainly save resources in payroll taxes whilst you cultivate a more pleased working surrounding for your people.

Purchase office furniture and hardware.

The Internal Revenue Service has often rewarded outlays for capital assets by offering the 179 Write-off. This exclusive deduction permits the prompt expensing of capital assets instead of diminishing them over their useful lives. Be advised though. This year, the limit for purchases diminished from $500,000 to $25,000. Even so, Congress will be reviewing increasing that ceiling probably at some point during 4th quarter. You may begin putting resources aside for the buyings now.

Perform extrapolations.

Take a good look at your fiscal statements. Run a profit and loss and compare it to the previous year revenue and decline through June 30. Are there major modifications? Are you preparing for an increase or decline in sales and/or spendings through the end of the year? It is's a walk in the park to export your information from QuickBooks to Excel where you can tweak the amounts to identify exactly what your yearend total revenue is going to be. Give this info with your tax planner to figure out if you should readjust your supposed tax obligation payments suitably.

Tuesday, July 15, 2014

'COIN' to be Trading Title for Winklevoss Start-up

Earlier this month, Silicon Valley VIP's, The Winklevoss brothers released the exchange symbol for their new bitcoin ETF (exchange traded fund). The bitcoin mutual fund will go public under the mark 'COIN'.

The electronic money caught the brothers' eyes more than a year previously when the worth of the coins skyrocketed. They revealed strategies to invest in the popular online currency early July 2013. Since then, extra data has been released regarding exactly what it was turning into. In May, the twins, publicized they were taking the Winklevoss Bitcoin trust (their Bitcoin ETF) to NASDAQ. They consider the value of Bitcoin can increase tremendously with a legitimate presence in the market. On July 15, 1 Bitcoin was worth $621.45, an incredible investment opportunity if what the Winklevosses say is true. This figure has been steadily growing since the announcement of the fund.

'COIN' is nonetheless delayed in government regulation and there is no crystal clear or official announced date for the IPO, even though many experts are guessing that (based on government approval) the fund may be trading before the end of the year.

It is an exciting period for the virtual industry, but maybe what is most fascinating about bitcoin particularly is the way in which it is broadening into the real world.

Read more about this story at the New York Times and at coindesk.

Tuesday, July 8, 2014

Tax Planning and Preparation: Joe Garza's Inside Look

It's never too early to begin tax preparation.

For several, tax day is hopefully a remote memory. But also for business manager, it's never too early to begin preparing for next year. And while the majority of businesses attempt to benefit from every allowable reduction, lots of have no idea that an excellent chunk of their marketing expenditures are tax deductible.

As a matter of fact, according to a recent questionnaire of business owners at Inside99Designs. com, greater than a quarter (27 percent) aren't also conscious that the IRS allows them to take off (" write off ") particular marketing costs on their income tax return. And from the 73 percent who do know about the write-offs, just 57 percent showed that they'll be taking advantage of them in the close to future.

And the study states ...

The study, conducted amongst 211 U.S.-based local business owners, showed that 64 percent of business owners say they are crossing out roughly the exact same amount this year as on their previous return, while only 22 percent are deducting much more.

And when asked what single advertising and marketing stations they 'd apply cash toward if they were to obtain a tax refund, the study claimed:

33 percent would certainly spend it on their site.
17 percent on web marketing.
17 percent on a mobile application.
10 percent on a print ad campaign.
8 percent on social media advertising.

Finally, when asked if they took into consideration the cash they invested in 2013 on advertising and marketing activities were a good use of money or if they felt otherwise, 70% confirmed, 23% were unsure, and 7% claimed no.

Simply to make clear, I'm by no implies a tax professional. Nonetheless, based on the searchings for from this study, I could develop a basic verdict that several small business owners ought to be speaking with their tax experts and reviewing possible tax deductible marketing expenditures. Yet as a small business proprietor, I find I'm in great company with those that are spending bucks back into their advertising and marketing methods in an effort to expand and keep a healthy and balanced consumer base.

Wednesday, July 2, 2014

Joe Garza of Dallas Talks Tax Shelters and Tax Plans

While the term "tax planning" is frequently utilized to describe the process, it's not necessarily thoroughly understood. Below is what tax planning really indicates. Remember, these methodologies aren’t just tax shelters, they’re legitimate planning and preparation methods to secure wealth.

Tax planning is the art of organizing your undertakings in ways that defer or avoid taxes. By putting to use beneficial tax planning systems, you can have more money to save and invest or more money to spend. Or both.Your choice.

Put differently, tax planning means deferring and flat out avoiding taxes by taking advantage of favorable tax-law stipulations, boosting and expediting tax deductions and tax credits, and generally making maximum use of all applicable breaks obtainable under our beloved Internal Revenue Code.

While the federal income tax regulations are now more complicated than ever, the advantages of good tax planning are arguably more important than ever before.

Of course, you should not change your fiscal practices only to avoid taxes. Genuinely effective tax planning solutions are those that enable you to do what you want while lowering tax bills along the way.

How are tax and financial planning related?

Financial planning is the art of enforcing approaches that help you reach your financial requirements, be they short-term or long-term. That sounds pretty very easy. Still, if the actual accomplishment was simple, there would be a lot more rich folks.

Tax and financial planning are closely related, considering that taxes are such a major expenditure item as you go through life. If you become really wealthy, taxes will most likely be your single most significant expense over the long haul. So preparing to reduce taxes is a critically important piece of the overall budgetary preparation process.

A Final Word

There are myriad other ways to commit costly tax mistakes. Such as selling appreciated securities too soon when holding on for just a bit longer could have led to lower-taxed long-term capital gains instead of higher-tax short-term gains; taking retirement account withdrawals prior to age 59 1/2 and getting stuck with the 10 % premature withdrawal tax; or failing to arrange for payments to an ex-spouse so that it can qualify as deductible alimony; the list continues.

The cure is to prepare for transactions with taxes in mind as well as avoid making careless changes. Looking for highly qualified tax guidance before pulling the trigger on major transactions is in most cases money well spent. As we get closer to the end of the year, a number of columns will involve tax planning tips that many people can benefit from.

Friday, April 18, 2014

Texas Taxes: A Small Business' Best Partner

The Lone Star State' lack of self income tax has long been a major draw for citizens. Among of only 7 states without a personal income tax, it surely surpasses states like California, which possesses a surprising income tax burden. Additionally, with 52 Fortune 500 companies in the state, and 12.9 million men and women comprising its workforce, Texas is maintaining-- and strengthening-- its reputation for being among the most significant business hubs in the country.

Businesses form Partnerships with Texas

Certainly there are lots of factors that contribute to Texas' thriving economic state. Two of the most significant ones? The state's tax structure and the numerous tax benefits that Texas presents to small business. As a matter of fact, the Lone Star State has some of the most affordable tax burdens in the USA Here's a closer look at the policies that make Texas such a business-friendly place.

Because of the Texas Tax Reform Commission, Texas changed out its franchise business tax in 2008 with a design that more accurately reflected the structure of establishments and helps the state continue being a more competitive player in the U.S. economy.

The reworked margins tax took over an outdated franchise business tax that was really formed at a period when the state's economy was directed by products rather than services. Within the latest law, the primary franchise tax rate dropped from 4.5 % to between .5 and 1 %. Additionally, an exemption is presented to small businesses with a profit below $1 million-- a resolution that helps 40,000 small companies in Texas.

The largest initiative of this kind in the U.S., The Texas Enterprise Fund was developed to catch the attention of out-of-state companies by incentivizing job creation and capital investment. Comprising more than $410 million, the fund extends awards ranging anywhere from $194,000 to $50 million to suitable businesses. The Texas Enterprise Fund has drawn in such businesses as Bank of America, Fidelity Global Brokerage, Lockheed Martin and Frito-Lay. It has also promoted a large technology influx in Austin where companies like Apple, Facebook, Sematech, and Samsung have just recently set up shop.

Texas Taxes, A Big Draw for Companies

"Texas grants a diversity of tax incentives to its own small companies" states Joe Garza - Tax Planning Attorney and Head Partner at Garza & Harris. "Incentives are granted for everything from manufacturing to contamination control to renewable energy - these incentives make Texas a rock-solid partner for business owners operating in-state". For example, exemption from state sales and use tax on natural gas and electricity are granted to manufacturers. Also, enterprises that implement renewable energy sources, such as solar and wind power, are eligible for a range of tax exemptions. Permissions such as these can seriously add up for business owners striving to support and expand a prosperous business in Texas.

Thursday, March 13, 2014

Investors: "Graduates Need to Save Now More than Ever"

Perhaps you recently graduated and have gotten your first serious job, you may think it is rather soon to start agonizing over saving and investing what little money you have. Unfortunately, that couldn’t be further from the actual truth. No matter how you consider at it, the earlier you start saving your money, the more of a cushion you'll have later. Also, determining to save the money you have early on will surely make things much better later when you are buying a place to settle down or preparing retirement. Beginning great financial habits certainly brings lasting rewards later in life. These novice budgeting habits can help you get a bit of financial security and make an investment toward your future.

Expect the unexpected.

As you start to ponder long-term goals, make sure you have made a plan of action prepared that addresses your present situation. Particularly that should include paying off any private or federal, but one key to a fiscally secure future is to anticipate debt before other obligations make your life get even more financially stressful. The last thing you want is to have past debt looming over your head when you'd rather be starting your family or considering buying new home.

Even more than paying off your loan debt, it is necessary to start putting away an emergency savings fund. At some point in the near future, you could have unexpected expenses. If you have to shell out the money for major surgery or an unexpected surgery, you'll be able to thank yourself for setting the funds aside before, and therefore sparing yourself from extra.

Identify your future goals.

Even if you don’t have your whole life mapped out, it's likely that you've got a feel for your biggest priorities and interests. If you'd like to travel the world while you're still young, your saving program are really going to look very different than if your financial goal is to go into early retirement. Deciding on your financial goals can help determine how much he/she needs to save every paycheck. Some Others have even advised young people to save up to 1/3 of their paychecks, with others suggesting that putting aside at least 10 percent is a good way to get into the habit of saving. Whatever amount you decide fits for your budget, make sure to put away finances for whatever your ultimate financial goals are (from owning a home, to traveling the world, to paying off debt) every month so that none of your goals are forgotten.

The best thing about starting strong saving habits is that you won’t start getting used to a lifestyle that becomes too expensive. It’s much easier to start lean and work toward a more extravagant life than it is to scale back on what you used to enjoy.

More from Professional Attorneys

Tuesday, January 21, 2014

IRS Unveils New Tech Oriented Tax-Filing Initiative

Capital Press

All the time, tax policy changes, get more involved, and change in order to assist (and disappoint) taxpayers. This tax season, you will likely to see a few changes to income tax policy, including adjustments for inflation, new policies for same-sex couples, and potential drawbacks for {not paying for health insurance either through a private vendor, or the federal government. One hallmark of the 2014 tax policy is its delay by several weeks, thanks to the embarrassing government shutdown back in 2013. Nonetheless, this filing season will also be the start of a completely different form of tax change — in terms of not only the amount we pay, but with the way we file.

2014's New Federal Tax-Filing Guide

At the beginning of the year, the Internal Revenue Service issued a “newly revised comprehensive tax guide,” or, as some people call it, Publication 17: a resource that should help Americans file their taxes more easily this year. Publication 17 boasts greater interactivity and tips for what it calls “tax-saving opportunities.” Among the inclusions made in Publication 17 is information on the American Opportunity Tax Credit which affects currently-enrolled college students and their guardians, as well as Earned Income Tax Credit and Child Tax Credit.

Created by the IRS since the 40's, the new issue of the guide will still include info on reporting income, capital gains and losses, IRA’s and useful content. However, at 292 pages, it's highly unlikely that many taxpayers make the time to read through Publication 17. Considering the complexity of Federal income tax, it is no surprise that the IRS posts almost daily updates to forms and instructions on their website.

Fewer Face-to Face Help Resources

The new IRS guide exhibits a major transition from in-person help resources, and more digital tools designed to help people get through tax season.

Reductions in the IRS budgets — as a result of sequestration — mean that there will be far fewer resources available for face-to-face tax submission assistance. Rather than having human interaction, those filing taxes will be referred to an array of online referential materials, including nearly 13,000 official partnering (volunteer) sites, and resources on IRS.gov - like the IRS 'Free File' program. Even the most basic questions will now be dealt with online or through one of the IRS' many hotlines. With such online assimilation becoming so ubiquitous, it's rational that a branch of the U.S. government would begin offering more of its services in the form of online content.

More Services Can Be Accessed on the Web

Though some will undoubtedly be frustrated by the lack of walk-in assistance, many others will be happy to know that they can address more tax-related problems online than ever before. Tax payers can now see and authenticate their tax forms online. Additionally, the IRS will also continue to post Employee Identification Numbers from its website. To avoid fielding taxpayer inquiries concerning the whereabouts of income tax refunds over the telephone, the IRS will now handle all similar questions online .

By Joe Garza Attorney at Garza & Harris Ltd.

Thursday, January 2, 2014

Halliburton Insists Supreme Court Take Second Look at Securities Law

Oil titan Halliburton Co just requested that the US Supreme Court revisit an important Supreme Court Case, Erica P. John Fund v. Halliburton. To be certain, The Fund is among Halliburton's shareholders. The Fund’s years-old courtroom battles with the oil company comes from the allegation that Halliburton falsely represented key info involving its shareholder activities, like overstating revenue and mitigating liabilities. Crucially, the Fund has attempted to have its action against the defense (Halliburton) as a class action lawsuit (CAL) - a form of lawsuit that is made on behalf of a certain group who have been offended by the same injury. A class action suit would allow the Fund to litigate on behalf of all Halliburton shareholders, therefore increasing the money on the table in the lawsuit.

The New York Times just published a topical analysis of the case that the Court will have to decide in the Halliburton case, should it agree to hear the case. The New York Times publication illustrates how many lawsuits like the one involving Halliburton and The Fund revolve around the concept of “reliance”, which says the litigation - or in this particular case, the shareholders behaved in reliance on the company's dishonest conduct. Supreme Court precedent has viewed reliance expansively. In order to suggest reliance, a shareholder involved in the CAL need not read a prospectus and the fraudulent statements it contains. Instead, courts consider any allegedly criminal statements made by a corporation that is also accepted by the public that affects the financial value of the corporation as being thrown into the total price of the its securities. The court justifies this view based on the basis that markets will price securities with all information that is currently available, something that is widely accepted in the study of finance. Nevertheless, even though most investors/shareholders do not thoroughly review financial records and prospectuses made publicly available by the companies in which they invest; plaintiffs involved with the CAL can still demonstrate “reliance” so long as they have purchased securities of the business. As more and more shareholders are capable of showing their reliance, these suits become easier to assemble.

In its court request to re-open the case, Halliburton has hinted that it will likely argue that the current interpretation of reliance is far too expansive. They will claim that the Court should interpret reliance as requiring shareholders to do more than merely purchase securities; for instance, requiring them to review a financial statement or fraudulent prospectus. This kind of an argument will probably receive enthusiastic backing from the business community.

As the Times article mentions, last year four members of the Court in an unrelated case stated that they were willing to overrule the conventional, nebulous meaning of “reliance.” If the Court hears the Halliburton case, the most important question will be about whether Halliburton can find a decisive fifth vote from the Court.

More by Joe Garza Attorney