Coverage also includes:
- Tax benefits for employers
- Business classifications
- S corporation tax issues
- Deductible expenses
- Retirement plans
- Shareholder loans
- Family employee payroll
- And more
About the Author
and tax planning. Brian also writes articles for PDXCPA, a Portland small business tax blog. Brian is a CPA licensed in the State of Oregon.
Table of Contents
Part I Essentials for the Small Business Owner 1
1 Small Business Taxation Basics 2
Are You Self-Employed or an Employee?
Self-Employment Tax and the Corporate Equivalent
Penalties, Fees, and Other New Revenue Raisers
State and Local Taxes
2 Business Income: Where it All Begins 7
What is Taxable Business Income?
What is Not Taxable Income?
When Does it Become Taxable Income?
Service Business Income Reporting Issues
3 Cost of Goods Sold: Tracking the Flow of Costs 13
What is Cost of Goods Sold?
How Do I Track Inventory and Cost of Goods Sold?
4 Business Deductions: What, When and How Much? 20
What Can Be Deducted?
What Cannot Be Deducted?
When Can the Deductions Be Taken?
How Much Can Be Deducted?
5 Fixed Assets and Depreciation 25
What is a Fixed Asset?
When Does Depreciation Begin?
What Assets Cannot Be Depreciated?
What is the Section 179 Deduction?
What is Bonus Depreciation?
What is MACRS Depreciation?
Repairs vs. Improvement
Sale, Disposals and Trade-ins
6 Deducting Payments to Workers 42
How Should I Classify Payments to Workers?
Do I Need an Employer Identification Number?
What is Taxable Employee Compensation?
When is Payroll Reported and Deducted?
Which Payroll Taxes are Employers Subject To?
When are Payroll Tax Deposits Due?
What Payroll Tax Reports are Required?
7 Accounting: The Key to Tax Savings & Success 59
Why is Accounting Important?
The Essential Accounting Basics
What is an Accounting System?
What are Accounting Methods?
When is an Accounting Method Selected?
The Cash Basis Method
The Accrual Basis Method
Can I Change Accounting Methods?
Avoid Tax Reporting Over-Complication
How Should I Keep My Records?
The $200 Accounting Solution Myth
Strategies for Efficient Setup of Accounting Software Files
Maintaining Organized and Accurate Books
What Your Tax Professional Should Provide
Part II Business Structure 79
8 Choosing Your Form of Business 80
Business Structure Considerations
Business Structure Options
9 S Corporation Tax Issues 93
S Corporation Basics
The Most Popular Tax Benefit of the S Corporation
What are Distributions?
What are Shareholder Loans?
Shareholder Basis: The Key to Deductible Losses
Reporting Health Insurance for Shareholders
Late Filing Penalties
10 Limited Liability Company Tax Issues 113
Basis for LLC Members
Late Filing Penalties
Part III Maximizing Your Deductions 123
11 Maximizing Your Deductions 124
The Correct Way to Maximize Your Deductions What is Deductible?
12 Vehicle Deductions 134
What Qualifies As Business Use of a Vehicle?
Maximizing Your Business Miles
How is the Vehicle Deduction Calculated?
Which method Provides the Larger Deduction?
Depreciation and Disposal Considerations
All Vehicles Are Not Treated Equally
Maximizing Your Vehicle Depreciation Deduction
Disposition of Vehicles
13 Travel Expenses 153
Travel vs. Local Transportation Expenses
What is Considered Traveling Away From Home?
Where is Your Tax Home?
What is Deductible?
Many Ways to Travel, Many Different Rules
14 Meals and Entertainment Expenses 171
What Entertainment Can Be Deducted?
Two Tests of Deductibility
Limitations on Meals and Entertainment
How Much Can I Deduct?
Personal vs. Business Entertainment
Country Clubs and Golf and Athletic Clubs
Entertainment Expense Recordkeeping
15 Retirement Plans 182
Why Set Up a Retirement Plan?
Understanding the Basics of Retirement Plans
The Individual Retirement Account (IRA) Alternative
Qualified Plan Contribution Limits and Tax Considerations
Simplified Employee Pension Plans (SEPs)
Solo 401k (Individual 401k)
Profit Sharing Plan (PSPs)
Defined Benefit Plan (DBPs)
Other Options for High-Income Business Owners
How Do I Setup a Retirement Plan?
Tax Credit for Starting a New Plan
16 Office in Home Deduction 197
What Qualifies as an Office in Home?
Corporations and the Office in Home Deduction
Calculating the Office in Home Deduction
Advantage to Renters
The Depreciation Tax Trap
17 Tax Benefits for Employers 210
The HIRE Act-Make Sure You Didn't Miss It!
Small Business Health Care Tax Credit
18 Family Employee Payroll 222
Eligible Business Structures
Eligible Family Employees
How the Strategy Works
How Much Should I Pay Them?
Reduced Tax Savings for the Ineligible