Month: March 2024

In the ever-evolving landscape of tax regulations, state pass-through entity taxes (PTET) have emerged as a strategic solution for business owners navigating the constraints of the state and local tax (SALT) deduction limit. This innovative approach has become increasingly prevalent across the United States, offering a legal avenue for pass-through entities to mitigate the impact…
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In a recent tax court case, the dedication and hard work of Duncan Bass, a multi-faceted entrepreneur engaged in various businesses, including landscaping, janitorial services, and a used clothing store, were brought to light. Despite his diligent efforts in both his W-2 employment—totaling approximately 68 hours weekly—and his entrepreneurial endeavors, Mr. Bass faced a significant…
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Selecting the appropriate business entity is a pivotal decision that can significantly influence your company’s legal framework, tax obligations, operational efficiency, and long-term growth potential. With various options available, such as sole proprietorships, partnerships, C corporations, and S corporations, understanding the nuances of each entity type is essential for aligning your business structure with your…
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Navigating the intricacies of tax incentives for electric vehicles (EVs) has become significantly clearer thanks to the latest guidance from the IRS on the new clean vehicle tax credits. As environmental consciousness grows, the interest in EVs has surged, accompanied by federal incentives designed to encourage the adoption of cleaner transportation options. Drenen Financial Services,…
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In the realm of small business ownership, navigating the intricate guidelines surrounding employee classification can be a source of significant stress and confusion. Misclassifying employees as 1099 independent contractors instead of W-2 employees can lead to severe repercussions from the IRS, including substantial fines, back payroll taxes, interest, and penalties. This situation poses a daunting…
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Navigating the complexities of business mileage deductions can be a daunting task for many professionals and business owners. Understanding the importance of maintaining a comprehensive and IRS-compliant mileage log is crucial for maximizing tax deductions related to vehicle use. At Drenen Financial Services, with our expertise in tax services and financial advisory, we’re here to…
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Living and working in Switzerland presents a unique and appealing opportunity for many, with its competitive salaries, excellent benefits, and the unparalleled beauty of its landscapes. However, embracing such an opportunity requires U.S. citizens to navigate the complexities of both Swiss and U.S. tax systems. Understanding the intricacies of these obligations is crucial for optimizing…
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Incorporating family members into your S corporation’s workforce can present both opportunities and complications, particularly when it comes to navigating the intricacies of tax deductions for health insurance premiums. If you’re a sole owner of an S corporation employing family members, understanding the correct tax treatment of their health insurance is crucial. Missteps in this…
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Encountering the daunting hobby loss rule can be a disheartening experience for anyone engaged in an activity that generates a tax loss. This rule, often perceived as “ugly” due to its harsh consequences, can significantly impact your financial situation by eliminating the possibility of deducting your losses and, worse, taxing you on any income received…
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The Tax Implications at a Glance For real estate professionals, grasping the tax ramifications of dealer versus investor status is paramount. Dealers face the prospect of their sales being taxed at both ordinary income rates, potentially up to 37%, and self-employment taxes, up to 14.13%. Additionally, dealers are constrained by specific tax code limitations, such…
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