Choosing a business entity comes down to two questions. State law decides liability protection, and the IRS classification decides tax. Sole proprietors and partners pay self-employment tax on all profit, S corporation owners pay payroll tax only on a reasonable…
A partner who sells an interest has a gain equal to cash received plus debt relieved, less outside basis. Most of it is capital gain under section 741, but the share tied to receivables, inventory and recapture is ordinary under…
A SEP IRA gives a sole proprietor about 20% of net earnings from self-employment. A solo 401(k) gives the same 20% plus an elective deferral of up to $24,500 for 2026 — so it puts away more at every income…
A Roth conversion is taxed at your marginal rate, so the planning move is to convert only up to the top of the bracket you are already in. For 2026 the 12% band ends at $100,800 of taxable income on…
New Jersey now claims ANCHOR, Senior Freeze and Stay NJ on one combined form, the PAS-1, due November 2, 2026. Homeowners under 65 and most renters are filed automatically. Senior homeowners and disability recipients are not, and must file themselves….
There is no percentage rule and no safe harbor. An S corp owner who works in the business is an employee, and the IRS can recharacterize distributions as wages to the extent they are reasonable pay for services performed. Nine…
A CP14 is the IRS’s first bill: you filed a return, the tax was not paid in full, and this is the balance with penalty and interest to date. Pay within 21 calendar days of the notice date and no…
Five things changed on Schedule C for 2025 and 2026: the mileage rate rose to 72.5 cents, bonus depreciation became a permanent 100%, the Section 179 limit reached $2,560,000, the QBI phase-in ranges widened, and a new tip deduction arrived….
Usually in the years between retiring and the start of required minimum distributions, when your income is temporarily low and the lower brackets sit empty. Convert in December once the year is known, fill a bracket without overflowing it, and…
Most people with foreign accounts file both. The FBAR is required when your foreign financial accounts together exceed $10,000 at any point in the year. Form 8938 starts at $50,000 for a single filer living in the United States and…
