Small Business Guidance - Part 2

It is being said, that there has never been a more diverse market for small business opportunities. There are so many ideas that are taking shape, along with brilliant creativity that is bringing new life into established industries and fields. A great deal of planning, care, and focus needs to be applied to create a business.
          Before a business can start to function, it must have the correct permits to operate and be incorporated. These are basic steps for any business and cannot be ignored. Picking up from our last post, when a new business opens, the flow income and expenses will start. In reality, those records should actually start before the doors open, it just gets faster afterward.
          This is a very stressful time for every business. Many costs need to be tracked, whether they are recurring or one-time, to make sure they don’t get out of hand. At Anthony Sykes & Co we can provide the services you need. With our deep knowledge of the needs that ever…

The Tax Cuts and Jobs Act: How it Affects a Business

With the new Tax Laws that have now gone into effect, businesses will see a big change in their finances. The most talked about aspect, is that the tax rate has been lowered to 21%. This is true, but it is not the only adjustment that businesses need to get familiar with.
          What is determined to be “qualified business income” from companies, such as LLC’s, Sole Proprietorships, or Partnerships, can become “pass through” income. If this “qualified income” is passed through to an individual, trust, or estate, then 20% of it can be deducted from the Federal Tax rate. This can be a nice option, but it is limited in availability. It will not be an option for certain types of businesses including those in the Health, Law, or Financial services fields. This deduction option will end in 2026. Considering how new this law is, it would be the course of wisdom to seek advice from a Qualified Tax Professional to determine the best strategy for your business. We at Anthony Sykes &a…

Small Business Guidance - Part 1

It can be said, that there has never been a more diverse market for business opportunities. There are so many ideas that are taking shape, along with brilliant creativity that is bringing new life into established industries and fields. A great deal of planning, care, and focus is needed to create a business. There are many considerations that will always play a factor in how a business starts and will grow. This is an exciting time, and timely guidance will help to avoid potential problems.
          The firm of Anthony Sykes & Co has significant experience in supporting and guiding small businesses. When a business is starting, it must choose a legal structure. This choice will affect how much will be paid in taxes, paperwork needed, and the liability of all involved. It will be very difficult to change this structure later. Each option has its own unique characteristics and we can clearly identify how they might affect your new venture, helping you to make the right choi…

Taxes and Home Rentals - Part 2

In the event that you own property and plan to use it exclusively to gain rental income, there are certain Federal Tax responsibilities that must be met. Understanding this in the beginning can allow for a relatively smooth time as a property owner in collecting rent, and easy preparation for Tax Returns or even an audit. All income must be reported, this includes rental payments, security deposits (if they will not be returned), or any charges for a broken lease agreement. This can also include expenses that are paid by the tenant, especially if the rental agreement does not obligate them to pay for those expenses. All costs related to ordinary and necessary management, conservation, and maintenance of a property is tax deductible. This would include the costs of supplies, repairs, and materials. Mortgage interest and property tax can be deducted as well. The costs of improvements are never included as a deductible expense.
         These are all detailed transactions, and keeping rec…

Keeping Up With the Speed of Change: Planning for 2018

It seems today, that the only constant that we can rely on is change. Whether that is true or not, there are many things that we do need to be aware of, and adjust to. There are waves of change that hit us and it's our responsibility to keep moving forward. That is especially true now.

         With all of the changes that have recently taken place, trying to look ahead and plan for the Tax Year of 2018 is very different than it was in 2017. The brackets have changed and overall taxes have changed. This is a situation that will require some patience. It is needed because no one can say for any certainty how things will definitely work out.
          One reason this is true is because the IRS has not yet issued guidelines on what needs to be done in different situations. Paychecks, for example, may look the same once or twice in the year before payroll companies are told how to adjust tax withholdings. After that, they can catch up. If you try to estimate on your own, it ca…

The Tax Cuts and Jobs Act: How it Affects Individuals

The new change to the Federal Tax code is the largest action to have taken place in the area of finance last 30 years. With that understanding, it can honestly be said that almost nothing will stay the same. Now would be a good time to learn the different details of what is in this law and what it will do.
          When filing a Tax Return, it has been a normal practice to deduct any State and Local Taxes (SALT) against the Federal Tax. This would mean a Taxpayer living in a state with Income Tax, such as California, could use their State Income, Sales, and Property Tax to pay a smaller Federal Tax amount. In essence, they would not have to pay these taxes twice. One of the largest changes to the Tax Code is in regard to this aspect of how Taxes are handled.
          Starting in 2018, these SALT deductions will still be allowed, but they will be limited to only $10,000. Any amount over this must be paid. This will more than likely increase the Federal Tax obligation of many …

The Tax Cuts and Jobs Act: What Does it Mean?

A sweeping change of the Federal Tax code has been passed. There are many questions and concerns about how it will affect individuals and businesses. Some changes are planned to be permanent, others will go away after a period of time, but now is the time to get familiar with the details of what this act will really do.
          First of all, please keep in mind that this law will not affect the Tax Return you will file by April 2018. The provisions and changes in this Act will start in 2018 and will be seen in the Tax filings in 2019. For individuals, there will be some very big adjustments in how their finances are taxed. For example, a Taxpayer will only be able to file as: Single or Married Filing Jointly. In future posts we will go into greater detail on this and other changes.
          In the area of business, we can find other ways the Tax Code is different. The tax rate for businesses will lowered to 21% starting in 2018. However, there are certain corporations that m…