Author: frank.rosillo

#8 Never use the Internal Revenue Service as your banker When cash flow is tight, you may be tempted to pay your suppliers first and payroll taxes to the IRS last. The IRS will take steps to minimize the liability…

#7 Hire your children to work in your business Wages paid will be deductible by your company and taxable to the family member. Your child’s earnings will probably fall in a lower tax bracket than yours. Payroll taxes apply to…

#6 Cash Vs Accrual Consider using the cash method of accounting if you meet the qualifications. Under the cash method, you generally report income to the IRS in the year you receive payment from customers. Under the accrual method, your…

#5 Tax and Asset Protection If your business is incorporated, it is often a good idea for you to separate ownership of the business real estate and lease it to your corporation. There are a number of tax and non-tax…

#4 Keep your Corporate Blackbook up to date If you operate a business entity, keep accurate and thorough minutes for the corporation. Minutes should document transfer of funds or assets into or out of the corporation, officers’ salaries, shareholder dividends,…

#3 Incorporate and elect S status If your sole proprietorship or partnership is producing a net profit in excess of a reasonable compensation for your time, you could save money by operation as an S corporation. You are required to…

  #2 Consider “Section 1244 Stock” for a new business If you are starting a business and choose to operate as a corporation, investigate the advantage of “Section 1244 Stock.” There are requirements that must be met, but if your…

#1 Choose your legal structure form of doing business carefully The tax and non-tax consequences of the structure you select are significant. The basic structures of operation from which to choose include: sole proprietorship, partnership, corporation, or limited liability company.…

“Sin tax” is a higher tax rate for products that typically have bad effects on the human body. Products that fall under Sin Tax include: GMO food, junk food, snacks, marijuana, vending machines food and soda drinks.  The concept of…

Not every new company starts off with perfect tax habits, but it is important that you learn from your mistakes and correct them as you go. It is always best to correct any IRS issues voluntarily rather than being forced.…