Building a better nonprofit: Rules for restructuring
Since Revenue Procedure 2018-15 went into effect, not-for-profit restructurings have generally been easier for organizations that qualify. You may be able to make some significant changes to your organization and simply use Form 990 to inform the IRS, bypassing the need to create a new legal entity and file a new exemption application. But don’t just assume your restructuring qualifies. Before making major changes, contact the CPAs and business advisors at SEK to discuss your plans.
Update on retirement account required minimum distributions
If you have a tax-favored retirement account, including a traditional IRA, you must comply with the required minimum distribution (RMD) rules after reaching a certain age. If you inherit a tax-favored retirement account, including a traditional or Roth IRA, you’ll also have to deal with these rules. Contact the CPAs and tax advisors at SEK to find out more.
Coordinating Sec. 179 tax deductions with bonus depreciation
Your business should generally maximize current year depreciation write-offs for newly acquired assets. Two federal tax breaks can help achieve this goal: first-year Section 179 depreciation deductions and first-year bonus depreciation deductions. These deductions can potentially allow businesses to write off some or all of their qualifying expenses in Year 1. Contact the CPAs and business tax advisors at SEK for more information on tax deductions and for more tax tips.
Mind the GAAP: How to ensure transparency when using non-GAAP metrics
The Securities and Exchange Commission closely monitors companies’ use of financial metrics that don’t conform to U.S. Generally Accepted Accounting Principles (GAAP). Over the years, the use of non-GAAP measures has grown. These unaudited figures can provide added insight when they’re used to supplement GAAP performance measures. But they can also be used to mislead investors and artificially inflate a public company’s stock price. Contact the CPAs and business tax advisors at SEK to discuss your company’s non-GAAP metrics and disclosures.
Nonprofits: Take another look at Inflation Reduction Act tax breaks
The Inflation Reduction Act’s tax provisions may seem like they were designed to benefit for-profit businesses. But the IRA can also help reduce the cost of nonprofit construction projects, so long as you use energy-efficient materials and qualified labor. Contact the CPAs and business advisors at SEK to learn how to allocate clean-energy construction deductions to qualified designers and become eligible for cash payments related to certain tax credits.
How renting out a vacation property will affect your taxes
What are the tax implications of renting out a vacation home part of the year? It depends on the time it’s rented and the time you personally use the home. Questions? Contact the CPAs and tax advisors at SEK for more information and for more tax tips.
Bartering is a taxable transaction even if no cash is exchanged
If your small business is strapped for cash (or likes to save money), you may find it beneficial to barter for goods and services. Bartering isn’t new, but the internet has made it easier. However, if your business barters, be aware that the fair market value of goods you receive is taxable income. And if you exchange services with another business, the transaction results in taxable income for both parties. Contact the CPAs and business tax advisors at SEK if you’d like assistance or more tax tips.
Beware of a stealth tax on Social Security benefits
Some people mistakenly think that Social Security benefits are free from federal income tax. Unfortunately, that’s often not the case. Depending on how much “provisional income” you have, some benefits could be hit with federal tax. The CPAs and tax advisors at SEK can calculate any tax on your benefits. Give us a call to answer your tax questions.
DOL issues Final Rule on independent contractors
The Department of Labor (DOL)’s Final Rule governing the standard for determining independent contractor status under the Fair Labor Standards Act (FLSA) became effective March 11, 2024.
