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Key 2024 inflation-adjusted tax parameters for small businesses and their owners
November 21, 2023
Categories: C Corp, Deductions, Depreciation, Federal Income, LLC, LTCG, Partnership, Scorp, Tax Brackets
The IRS recently announced various inflation-adjusted federal income tax amounts. Here’s a rundown of the amounts that are most likely to affect small businesses and their owners. Rates and brackets If you run your business as a sole proprietorship or pass-through business entity (LLC, partnership or S corporation), the business’s net ordinary income from operations is passed through to you and reported on your personal Form 1040. You then pay the individual federal income tax rates
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Spouse-run businesses face special tax issues
September 12, 2023
Categories: #hh, Partnership, Scorp, Self Employment, Small business
Do you and your spouse together operate a profitable unincorporated small business? If so, you face some challenging tax issues. The partnership issue An unincorporated business with your spouse is classified as a partnership for federal income tax purposes, unless you can avoid that treatment. Otherwise, you must file an annual partnership return, on Form 1065. In addition, you and your spouse must be issued separate Schedule K-1s, which allocate the partnership’s taxable income, deductions
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Partners may have to report more income on tax returns than they receive in cash
May 23, 2022
Categories: #hh, Partnership, returns, Tax
Are you a partner in a business? You may have come across a situation that’s puzzling. In a given year, you may be taxed on more partnership income than was distributed to you from the partnership in which you’re a partner. Why does this happen? It’s due to the way partnerships and partners are taxed. Unlike C corporations, partnerships aren’t subject to income tax. Instead, each partner is taxed on the partnership’s earnings — whether or not they’re distributed.