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Tax Strategy for the Week (December 20th, 2013)

Fun Asia Show Recording-December 19, 2013
Transfers to Charity at Death
Tax Issue

A gift to charity at death is deductible for estate tax but generally not for income tax. Lifetime gifts to charity, on the other hand, reduce the taxable estate and also provide an income tax deduction. The problem with a sizable lifetime charitable gift, however, is that it may leave the donor uncertain about their future financial security. The safest course is to wait until death to be sure that the money will not be needed.


Applicable Tax Law

Most gifts to charity, regardless of the amount, are fully deductible for […]

Tax Strategy for the Week (December 13th, 2013)

Fun Asia Show Recording-December 12, 2013
Turning Charitable Contributions into Advertising Expenses
Tax Issue

Charitable contributions made by businesses do not receive the same tax treatment as advertising expenses. Contributions are subject to various limitations and restrictions at both the entity and personal tax level. Carryovers are generally limited to five years and unused deductions are forfeited. Partners, S corporation shareholders, and sole proprietors deduct charitable donations on Schedule A.  Any tax benefit depends on the taxpayer’s marginal tax bracket, potentially resulting in unequal tax treatment among shareholders or partners. The charitable contribution loses its vale as a tax deduction for individuals […]

Tax Strategy for the Week (December 6th, 2013)

Fun Asia Show Recording-December 5, 2013
Standard Mileage Rate – How It Can Avoid Auto Expense Limits

Tax Issue

For owners of passenger automobiles, section 280F imposes dollar limitations on the depreciation deduction for the year the taxpayer places the passenger automobile in service and for each succeeding year. However, the limitations of section 280F do not apply to depreciation expense calculated using the standard mileage rate method.


Applicable Tax Law

Passenger autos. For purposes of the section 280F limitations, a passenger auto is any four-wheeled vehicle that is made primarily for use on public streets, roads, and highways. Its unloaded gross vehicle weight […]

Tax Strategy for the Week (November 29th, 2013)

Fun Asia Show Recording-November 28, 2013
Independent Contractors – How to Avoid Tax Problems
 Tax Issue

There is a real incentive for small business owners to try to avoid payroll taxes and the administrative red tape that goes along with hiring workers as employees. Treating workers as independent contractors is tempting when one considers that there is no corresponding payroll tax return to file, no employer matching for FICA, no unemployment tax, and no workers’ compensation insurance to purchase. The only administrative cost of treating a worker as an independent contractor is the requirement to issue a 1099 to the worker at […]