Our Blog

Posted on Friday, August 12, 2022
The buzz about the IRA potentially getting billions in new funding and hiring 87,000 new employees is typical of the news spinners who thrive on creating anxiety for the general public. The tax industry has known the IRS’s secret for years now and the few people in the public that pay attention know that these people are desperately needed!  Like many restaurants and other businesses that have closed because of staff shortages and uncertainty, the IRS at current staff levels has been almost impossible to reach and is years behind in its work. They have had tens of thousands of employees retire without being replaced, and just reaching the IRS to speak to someone about an issue can take days...

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Posted on Friday, August 05, 2022
When planning ahead, or just engaging in their day to day operations, most business owners at least occasionally think about tax deductions. A business dinner that can be partially deductible, or a new machine that can be depreciated. However, they often don’t think about or plan how to acquire other tax credits, which can often be much more valuable. Tax credits are often transitory, with the benefits increased or reduced from year to year, or sometimes eliminated altogether, only to be brought back again several years later. Over the last few decades we have seen some popular credits renewed or in some cases even made a permanent part of the tax code. Small business owners seem to often not be aware...

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Posted on Friday, July 29, 2022
Many times business owners have come into our office and with our help have found that they were doing things incorrectly regarding their bookkeeping and taxes.  Occasionally, the errors add to the tax burdens that they have been under-reporting.  That never feels good, but it is always better to fix those issues prior to any audit.  Often, errors discovered “pre-audit” can be fixed by simply amending the return, and no IRS issues follow, and everyone just moves on.  But quite often, the errors made were not in their own favor. In those case, we help them file amended returns that net them large additional refunds for up to three years back, and that always feels great! So, how do these...

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Posted on Friday, July 22, 2022
When people are contemplating selling an asset like a house, an investment property, stock or a business asset, it’s usually to make a profit or to raise cash. Sometimes, a house is sold in order to buy bigger (or smaller), to move to a different town to take a new job. In the case of stocks, it might be for the taking of profits, stopping further loses, or again to raise cash.  One common thread among all of these decisions is that people generally think about them for some time before they act, as usually these are among the largest assets they have. What we see often in the tax planning world is that people sell the asset, and then...

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Posted on Friday, July 15, 2022
It’s July.  In a few short months people will be filing their 2022 tax returns with that familiar recurring moan and groan about paying too much. Now is the time to take your preventative medicine and avoid the pain next time around! Being human, we all form habits.  Some good.  Most bad.  We try to develop good ones to replace the bad ones and often we are successful, but most successes don’t come without a coach, cheerleader or some kind of support. Tax time is usually a time of regret over not being successful at last year’s promise to oneself, “I’m not going to pay this much again.  I`m going to keep better records and search out a tax planner...

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Posted on Friday, July 08, 2022
For most years, the IRS sets the mileage deduction rate for business use of personally owned vehicles and leaves it at that rate for the entire year. In those cases, the business owner taxpayer will need to keep track of and report the total number of miles driven for the year, the number of business miles driven, the number of commuting miles and the number of personal miles, so that the IRS knows how many miles are eligible for the business mileage deduction (commuting and personal miles are not eligible). This year, the IRS has done something unusual, but not unprecedented, in that they have changed the deduction amount halfway through the year. How does that affect you as a...

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Posted on Friday, July 01, 2022
It’s human nature, of course.  We complain about our weight while in the line at the ice-cream stand.  We complain about being tired, then stay up late playing the latest game on our smart devices. Humans are funny and contradictory animals. Have you ever noticed that when you’re in a conversation, people are quick to complain about their taxes?  Many people who complain about their tax bill are actually paying very little compared to most folks.  However, some people pay a lot of unintended or surprise taxes.  An example we see a great deal are self-employed folks.  They will tell us “I pay too much in federal or state income taxes,” but on review of their 1040, they actually paid...

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Posted on Friday, June 24, 2022
Some do it often, while others hold on all year for that one great week and live day by day until that magical start date on the calendar!  A new wave in our digital age is to only take three or four day weekends, but do it more often. However you “vacation”, they do have one common thread, and that is that they are not free.  Furthermore, when you are officially vacationing (which becomes a mindset as well….I am officially on vacation as of right now!) you spend more freely, often with a disregard for cost shopping.  “I’m stopping at Starbucks for the Mocha Frappuccino, not Dunkin, cause I’m on vacation!”. What if next vacation you could upgrade to fly...

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Posted on Friday, June 17, 2022
Tax policy and rates have always been fluid, much more so than most people realize, as they only focus on it for short periods one time a year. You also don’t see many high school or college classes on the history of taxes and tax planning, unless you’re in accounting school. Like a distant relative you see at an occasional wedding, you forget most of the prior experiences and conversations and simply repeat them as an act of convenience. It’s the lack of personal taxation understanding and the continuous ebbs and flows that allow the tax authorities to keep things the same just long enough to let people form habits, then change the tax rules to penalize the habits created....

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Posted on Friday, June 10, 2022
People who earn more than $91,000 a year ($182,000 for joint filers) and who are in Medicare Part B or Medicare Part D, or both, will face additional premiums, called income-related monthly adjusted amount (IRMAA). IRMAA “surcharges,” which is a replacement word for a tax, are based on income earned two years prior to the coverage year. A client enrolling in Medicare in 2022 would pay an IRMAA surcharge based on their 2020 tax return. Generally there are two types of people that pay IRMAA surcharges: Those who might be affected and those who will always be affected. Because it is income based, people with an unusual income event may only be affected once, while people with higher incomes may always be affected....

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