Converting a C Corporation to an S Corporation: Potential Tax Implications

In recent years, the number of companies converting from C corporation status to S corporation status has increased dramatically. One of the main reasons is to avoid double taxation. C corporations are taxed at the corporate level for federal income tax purposes. Additionally, the C corporation shareholders are also taxed on any capital gains realized …

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Mid-Year Tax Planning Tips

Summer is the perfect time to begin your year-end tax planning so that you have time to identify the strategy (or strategies) that work for you and implement them well before year end. Try to avoid the new 3.8% net investment income tax (NIIT). It only affects higher-income individuals, but that can include anyone who …

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Changes to Requirements for Reporting Discontinued Operations

In April 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-08 Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity that changed the requirements for reporting discontinued operations. Under the new standards, a disposal of …

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Timing Rules for SEPs and SIMPLE-IRAs Part II

For the most part, SEPs (Simplified Employee Pensions) and SIMPLE (Savings Incentive Match Plan for Employees)-IRAs live up to their billing as easy ways to set aside tax-favored retirement funds for employees and employers. However, contribution rules for these plans are not necessarily straight-forward. To read part I of this post dealing with SEPs, click …

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Timing Rules for SEPs and SIMPLE-IRAs Part I

For the most part, SEPs (Simplified Employee Pensions) and SIMPLE (Savings Incentive Match Plan for Employees)-IRAs live up to their billing as easy ways to set aside tax-favored retirement funds for employees and employers. However, contribution rules for these plans are not necessarily straight-forward. SEP plans: Business owners can set up and fund their SEP …

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Testifying awareness – why CPA experts should be careful of what they write

CPAs who have been retained as testifying expert witnesses often prepare a written report, sometimes with accompanying exhibits, in support of their opinions to be expressed in the courtroom.  Experienced CPAs who do this sort of thing typically include a statement of their qualifications as a part of their reports.  This statement of qualifications, or …

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Business Combinations 101

Over the past year, there seems to be some increase in activity related to mergers and acquisitions (“M&A”).  When times are tough you typically see an increase in M&A activity as strong companies will act to buy other companies to create a more competitive, cost-efficient company.  M&A’s can come in various forms.  They can be …

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Due Diligence Tips for Buying a Business – Part 1

Leonard and Sylvia Buy a Business Leonard and Sylvia sold their sheet metal manufacturing plant in Pittsburgh and decided to move to sunny Phoenix, Ariz.  They wanted to buy another business and, through a business broker, found a high-tech electronics manufacturing company that was for sale.  Leonard and Sylvia thought “manufacturing is manufacturing,” whether it …

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Thinking of Terminating Your 403(b) Plan?

The IRS provided some additional guidance of considerations when terminating a 403(b) plan in their Spring 2011 Edition of Retirement News for Employers.  It accompanies their Revenue Ruling 2011-7, which provides examples of how to terminate a 403(b) retirement plan funded in various ways and discusses when terminated plan distributions may be taxable.  You can …

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