Classify Your Nonprofit’s Workers Correctly — Or Risk Repercussions

Many not-for-profits are understaffed in 2022, thanks to a labor shortage and pandemic-related budget shortfalls. Some organizations are filling the gaps with freelancers and contractors. However, such decisions can lead to trouble if these workers should really be classified as employees according to the Department of Labor (DOL) or the IRS. To ensure your workers […]

Entrepreneurs And Taxes: How Expenses Are Claimed On Tax Returns

While some businesses have closed since the start of the COVID-19 crisis, many new ventures have launched. Entrepreneurs have cited a number of reasons why they decided to start a business in the midst of a pandemic. For example, they had more time, wanted to take advantage of new opportunities or they needed money due […]

How Will Revised Tax Limits Affect Your 2022 Taxes?

While Congress didn’t pass the Build Back Better Act in 2021, there are still tax changes that may affect your tax situation for this year. That’s because some tax figures are adjusted annually for inflation. If you’re like most people, you’re probably more concerned about your 2021 tax bill right now than you are about […]

Many Factors Are Involved When Choosing A Business Entity

Are you planning to launch a business or thinking about changing your business entity? If so, you need to determine which entity will work best for you — a C corporation or a pass-through entity such as a sole-proprietorship, partnership, limited liability company (LLC) or S corporation. There are many factors to consider and proposed […]

Who In A Small Business Can Be Hit With The “Trust Fund Recovery Penalty?”

There’s a harsh tax penalty that you could be at risk for paying personally if you own or manage a business with employees. It’s called the “Trust Fund Recovery Penalty” and it applies to the Social Security and income taxes required to be withheld by a business from its employees’ wages. Because taxes are considered […]

An S Corporation Could Cut Your Self-Employment Tax

If your business is organized as a sole proprietorship or as a wholly owned limited liability company (LLC), you’re subject to both income tax and self-employment tax. There may be a way to cut your tax bill by conducting business as an S corporation. Fundamentals of self-employment tax The self-employment tax is imposed on 92.35% […]

What’s On The FASB’s 2021 Agenda?

In December 2020, Richard Jones stepped up as chairman of the Financial Accounting Standards Board (FASB). After meeting with stakeholders in early 2021, Jones identified a list of high-priority projects that he plans to tackle under his leadership. Big picture The FASB is responsible for creating and updating U.S. Generally Accepted Accounting Principles (GAAP), the […]

Retiring Soon? Recent Law Changes May Have An Impact On Your Retirement Savings

If you’re approaching retirement, you probably want to ensure the money you’ve saved in retirement plans lasts as long as possible. If so, be aware that a law was recently enacted that makes significant changes to retirement accounts. The SECURE Act, which was signed into law in late 2019, made a number of changes of […]

New Revenue Idea? Watch Out For The Commerciality Doctrine

If your not-for-profit has lost financial support during the pandemic, you may be looking for ways to raise new revenue. But if your proposed solution is a side business, be careful. Even when business ventures are related to a nonprofit’s exempt purpose, they can run afoul of the commerciality doctrine — and jeopardize an organization’s […]

New Law Provides Option To Delay Implementing The Updated CECL Standard

The Consolidated Appropriations Act (CAA), signed into law on December 27, 2020, includes a variety of economic relief measures. One such measure allows certain banks and credit unions to temporarily postpone implementation of the controversial current expected credit loss (CECL) standard. Here are the details. Updated accounting rules The Financial Accounting Standards Board (FASB) issued Accounting […]