Executive's Tax & Management Report articles from July 2003

Executive's Tax & Management Report archives from July 2003

Tax law changes redefine accelerated depreciation.
July 21, 2003... The Jobs and Growth Tax Relief Reconciliation Act of 2003 allows businesses to deduct bonus depreciation equal to one-half of the cost of new equipment acquired after May 5, 2003. The bonus depreciation provisions also apply to land...

Don't get duped by advance child tax credit scam.
July 21, 2003... If you are entitled to the $400 advance child tax credit being issued this summer (see your July 7 issue), you should be wary of a new tax scam targeting potential recipients. However, the IRS recently warned that it has seen isolated...

Six ways to maximize owner contributions in a 401(k) plan. (Retirement Planning).
July 21, 2003... If you're a business owner, putting money back into your business is not the only way to invest for the future. Regularly placing funds in an investment account is prudent planning. You should consider a qualified account, such as a 401(k)...

Can you lower your estimated tax payments? (Tax Procedures).
July 21, 2003... If you or your company makes estimated tax payments, you may be able to reduce the amount you pay next quarter. Due to tax cuts enacted in the Jol3s and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA), the IRS is advising self-employeds...

Retirement funds mistakenly used for loan collateral. (Dealing With the IRS).
July 21, 2003... When a taxpayer defaulted on a loan, the IRS said he was subject to taxes and penalties on funds withdrawn from his retirement fund--even though the retirement fund was mistakenly used as collateral for the loan. He paid the taxes and...

Housekeeper's meals and lodging are taxable income. (Personal Taxes).
July 21, 2003... Meals and lodging provided to a housekeeper are considered taxable income that must be reported on his or her Form 1099 or W-2 at the end of the year. That was the message in a recent opinion by the Tax Court [Teddy R. McGinty Jr., et ux. v....

Rental income isn't passive if you provide services. (Business Taxes).
July 21, 2003... If your company rents property and provides related services, the rental income you receive may not be passive investment income in the eyes of the IRS. That's what a commercial real estate company recently learned in recent letter rulings...

Write off interest paid on a new boat or RV. (Executive's Briefcase).
July 21, 2003... Write Off Interest Paid on a New Boat or RV. If you're buying a boat or an RV this summer, the interest you pay may be tax deductible. The National Association of Enrolled Agents (NAEA) offers the following strategies to qualify for...

Meetings are the biggest time-wasters at work, survey says. (Executive's Briefcase).
July 21, 2003... Meetings Are the Biggest Time-Wasters at Work, Survey Says. Before your management team schedules its next meeting, you might want to reevaluate the purpose of the meeting and who should be invited to it. A recent survey points to meetings as...

Lack of profit motive negates business expense deductions.
July 7, 2003... The Internal Revenue Code allows taxpayers to take deductions for ordinary and necessary expenses paid or incurred in carrying on a trade or business [Sec. 162(a)]. But generally, under Sec. 262, no deduction is allowed for personal, living,...

Tax question.
July 7, 2003... Q Our second child was born in April of this year. Since the IRS is sending child tax credit refunds of $400 per child this summer, can we expect to get an $800 check? A No. The IRS is calculating the advance refund amounts based on...

IRS helps taxpayers get on the "Fast Track." (Executive's Briefcase).
July 7, 2003... The IRS has made permanent two pilot programs that allow taxpayers and the IRS to reach agreement on tax disputes more quickly [IRB 2003-25, 6/23/03]. The Fast Track Mediation Program, which began in 2002, gives small businesses and...

Shareholder takes company to court over "excessive" pay for executives. (Executive's Briefcase).
July 7, 2003... Aaron Landy, a small shareholder of John Hancock Financial Services, has filed a civil suit in the Boston Federal District Court, claiming that the CEO and other senior executives improperly profited when the company went public in early...

IRS corrects tax publications. (Executive's Briefcase).
July 7, 2003... The latest announcement of errors in IRS publications deals with Pub. 536, Net Operating Losses, and Pub. 971, Innocent Spouse Relief (And Separation of Liability and Equitable Relief). If you downloaded these publications before mid-June,...

Returned gift not subject to tax. (Income And Gift Taxes).
July 7, 2003... IRC Section 2511(a) provides that the gift tax applies to a transfer by way of gift whether the transfer is in trust or otherwise, whether the gift is direct or indirect, and whether the property is real or personal, tangible or intangible....

How the new tax law affects your closely held business. (Closely Held Businesses).
July 7, 2003... There's no question that the new tax reduction package (the Jobs Growth and Tax Relief Reconciliation Act, or JGTRRA) will have a significant impact on your business. The new tax law includes some obvious benefits, such as the 50 percent...

IRS will advance refund of the increased child tax credit. (Tax Credits).
July 7, 2003... As we noted in your June 21 issue, the new Jobs Growth and Tax Relief Reconciliation Act (JGTRRA) increases the child tax credit to $1,000 for 2003. The law also instructs the IRS to provide the difference (up to $400 per eligible child) as...

It's time to update your calendar. (Tax Compliance).
July 7, 2003... In the December 7, 2002, issue of Executive's Tax & Management Report, we included a "federal tax action" calendar for January through June 2003. On the next four pages, you'll find the schedule of federal tax filing and deposit deadlines...

Federal tax action calendar for July-December 2003.
July 7, 2003... JULY Wednesday, July 2 FICA and withheld income tax. Semiweekly depositors deposit the tax on wages paid June 25-27. Monday, July 7 FICA and withheld income tax. Semiweekly depositors deposit the tax on wages paid June...