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Category: Accounting

What is the Affordable Care Act?

Under the Affordable Care Act, the federal government, state governments, insurers, employers, and individuals share responsibility for improving the quality and availability of health insurance coverage in the United States. The ACA reforms the existing health insurance market by prohibiting insurers from denying coverage or charging higher premiums because of an individual’s preexisting conditions. The ACA also creates the Health Insurance Marketplace, also known as the Marketplace or the Exchange. The Marketplace is where taxpayers […]

The Individual Shared Responsibility Payment

Beginning in 2014, the individual shared responsibility provision of the Affordable Care Act requires each individual to: – Maintain a minimum level of health care coverage – known as minimum essential coverage, or – Qualify for an exemption, or – Make an individual shared responsibility payment when filing their federal income tax returns. Minimum essential coverage generally includes government-sponsored programs, employer-provided health coverage, and coverage purchased in the individual market, including the Health Insurance Marketplace.  […]

Information for Employers about Their Responsibilities Under the Affordable Care Act

If you are an employer, the number of employees in your business will affect what you need to know about the Affordable Care Act (ACA). Employers with 50 or more full-time and full-time-equivalent employees are generally considered to be “applicable large employers” (ALEs) under the employer shared responsibility provisions of the ACA.  Applicable large employers are subject to the employer shared responsibility provisions.  However, more than 95 percent of employers are not ALEs and are […]

It’s Not Too Late to Report Changes in Circumstances that May Affect Your Premium Tax Credit

If you enrolled in insurance coverage through the Health Insurance Marketplace , you are required to report changes to the Marketplace when they happen, like changes to your household income or family size, because they may affect your eligibility for the advance payments of the premium tax credits. Changes in circumstances that you should report to the Marketplace include, but are not limited to: > an increase or decrease in your income > marriage or […]

Foreign Tax Credit Compliance Tips

Foreign Sourced Qualified Dividends and Gains If you have received foreign sourced qualified dividends and/or capital gains (including long-term capital gains, unrecaptured section 1250 gain, and/or section 1231 gains) that are taxed in the U.S. at a reduced tax rate, you must adjust the foreign source income that you report on Form 1116, line 1a. How do I make the adjustment? ·         Form 1116 Instructions – See the detailed instructions for “Foreign Qualified Dividends and Capital […]

Foreign Tax Credit – Choosing To Take Credit or Deduction

Making the Choice You can choose each tax year to take the amount of any qualified foreign taxes paid or accrued during the year as a foreign tax credit or as an itemized deduction. You can change your choice for each year’s taxes. To choose the foreign tax credit, you generally must complete Form 1116, Foreign Tax Credit and attach it to your U.S. tax return. However, you may qualify for an exception that allows you […]

Death of a Taxpayer

When a taxpayer dies, there are certain returns that still need to be filed, a responsibility that falls onto the personal representative. Personal Representative Under state law, a personal representative is the person appointed by a court to administer an estate. The term includes both executors (appointed when decedent has a will) and administrators (appointed in the absence of a will). A personal representative nominated in a will has no authority over estate assets unless […]

Know Your Rights as a Taxpayer

Whether you file a Form 1040EZ or a complicated corporate return, you will benefit from knowing your rights as a taxpayer and being familiar with the IRS’ obligations to protect them. You have certain rights as a taxpayer when dealing with the IRS. Seven of most important rights as a taxpayer are listed below. I. Protection of Your Rights: IRS employees should explain and protect your rights as a taxpayer throughout your contact with IRS. […]

Estate and Gift Tax

There is no dullar limit on the amount that one person is allowed to give to another. Gift tax rules do not prohibit a donor from making gifts in excess of the annual exclusion ($13,000 for 2012). However, if more than the annual exclusion is given to any one recipient, the amount over the annual exclusion is considered a “taxable gift.” Consequences of making taxable gifts: Donor is required to file a gift tax return […]

Itemized Deductions Medical Expenses

Itemized Deductions—Medical Expenses Medical expenses are the costs of diagnosis, cure, mitigation, treatment, or prevention of disease, and the costs for treatments affecting any part or function of the body. Medical expenses include the costs of equipment, sup-plies, and diagnostic devices needed for these purposes. The expenses must be primarily to alleviate or prevent a physical or mental defect or illness. When Medical Expenses Are Deductible Medical expenses are deductible in the year actually paid, […]

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