Business Insights

The tax code allows an individual to claim a deduction for business debts that have become worthless. But qualifying for the deduction may be more complicated than one would think. In a recent case, the IRS denied more than $17 million in bad debt deductions on the grounds that the advances in question represented equity rather than debt, hitting the taxpayer with millions of dollars in taxes and penalties. This article recounts the U.S. Tax Court case Allen v. Commissioner. Allen v. Commissioner (T.C. Memo 2023-86).

During the COVID-19 pandemic, business travel nearly came to a halt. Today, it’s on the rebound, as “Zoom-fatigued” executives craving face-to-face interaction hit the road again. With more people getting out of their offices, now is a good time for a refresher on the tax deductibility of business travel expenses. This article explores what’s considered one’s tax home and what expenses are deductible. A sidebar explains the deductibility rules when a business trip is mixed with pleasure.

The 20% qualified business income (QBI) deduction is available for income from an eligible trade or business, but it isn’t available if that same property is classified as an investment. This article points out that it’s worth considering whether an owned rental property meets the definition of a trade or business under IRS requirements. It also explains that determining whether rental real estate activities qualify for the QBI deduction is a complicated undertaking and is likely to require the services of a tax professional.

Navigating the intricate world of financial reporting can often seem like maneuvering through a sea of technical terminology and regulatory obligations, particularly challenging for small businesses and startups. In a landscape dominated by the need for clarity in the financial health of companies, the role of compilation services is critical. Understanding how compilation services can simplify financial reporting is not just optional knowledge—it is essential for making informed business decisions and fostering growth.

SECURE 2.0 - There are some significant changes in 2024 and 2025 that may help nonprofit employers recruit and retain employees. This article presents what organizations need to know.

Many businesses are surprised by the bills they receive for their cloud usage. This article suggests some steps a business can take to help its organization control its cloud spending and get a handle on cloud operations, costs and value — including setting a budget for and tracking cloud usage, and applying procurement controls. The article notes that regularly fine-tuning cloud management efforts will help a business use its cloud resources efficiently and effectively.

We highly recommend that you contact your Corporate Attorney regarding potential filing requirements as soon as possible. At this time, accounting firms are strongly being advised not to complete a Beneficial Ownership Information Filing, as this is a legal filing and could be considered the unlicensed practice of law.

As businesses wrap up the year, savvy tax planning is key. Leveraging depreciation-based deductions like Section 179, bonus depreciation, and regular depreciation can yield significant savings, especially if businesses act before year's end to qualify for these breaks. The new SECURE 2.0 law offers fresh opportunities and considerations for qualified retirement plans, urging employers to adapt for benefits like enhanced credits and contributions linked to employee student loans. Additionally, strategic timing of employee bonuses can optimize tax deductions for the company while deferring income for employees. Businesses should also consider end-of-year purchases and maximizing Qualified Business Income deductions to further reduce tax burdens. This concise overview provides a snapshot of actionable tax strategies for businesses aiming to close the year with financial efficiency.