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OTHER TAXING MATTERS. With Jack Cohen, CPA IncSmart.biz Inc. After Selecting an Entity What am I about to Receive?. Income Tax Reporting Forms Payroll Tax Reporting Forms State Tax Reporting Forms Sales and Use Tax Forms Personal Property Tax Forms Others. Payroll Reporting. 940 FUTA

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other taxing matters


Jack Cohen, CPA

IncSmart.biz Inc

after selecting an entity what am i about to receive
After Selecting an EntityWhat am I about to Receive?
  • Income Tax Reporting Forms
  • Payroll Tax Reporting Forms
  • State Tax Reporting Forms
  • Sales and Use Tax Forms
  • Personal Property Tax Forms
  • Others
payroll reporting
Payroll Reporting
  • 940 FUTA
  • 941 Federal Withholding and Social Security
  • State Withholding
  • State Unemployment
  • State Disability
  • Others
tax tip
Tax Tip
  • Use Payroll company
state and local taxes
State and Local Taxes
  • Sales tax
  • Use tax
  • Personal property tax
  • Business license or permit
where people get in trouble trying to avoid sales tax
Where People Get In TroubleTrying to Avoid Sales Tax
  • Who is responsible for collecting the tax?
  • What if I purchase merchandise out of state?
  • What is a resellers certificate?
nexus what is it and how is it determined
NexusWhat is it and how is it determined?
  • United States Supreme Court has held that states can only impose tax or collection responsibility when:

There is a substantial physical presence between the state and:

the seller

the transaction

the activity

The state may require out-of-state vendors to provide


nexus continued
  • Substantial physical presence includes:
  • Owning or leasing real estate or tangible personal property
  • Maintaining a business location or inventory
  • Having resident or nonresident employees work within the state
  • Incorporating or qualifying to do business
  • Using the company’s own trucks and personnel to make deliveries into the state on a regular basis
nexus continued1
  • Employee Visits

Phillip Crosby Associates, Inc. (Alabama-1996)

Management Consulting Business

Telemarketing sales; in-person visits 26/year

Did 69 projects and training over three years

Nexus upheld-considered regular and repeated

B.L. Key, Inc. (Utah-1997)

MFG sent 3 supervisors to Utah on 8 trips lasting a week to a month

Supervisors hired 4 employees each trip

Argued presence was not regular but sporadic

Nexus upheld-ruled regular means repeated

nexus continued2
  • Representative’s Nexus

Out of State Mail orders

Independent Sales Rep

Some 800 phone numbers

Telemarketers ruled as independent sales reps

  • Printer’s Nexus

Applies to out-of-state companies establishing Nexus

By storing paper at the printer’s location

By visitations to the instate printer

  • Instate deliveries - How many?
  • Drop Shipments
new business expenses
New Business Expenses
  • Start-up expenses
  • Organizational expenses
  • Web site expenses
start up expenses
Start Up Expenses
  • Money advanced to corporation = loan
  • Deductible upon start of business
  • Start – When apartment is available
  • When open for business
  • When searching for business
  • Capital Expense Until Start
business travel
Business Travel
  • Client calls
  • Market research
  • Plan your vacation around


tax tip1
Tax Tip
  • Maintain Good Records
  • Receipts with business reason.
  • Diary – Kept Contemporaneously.
  • Primary reason for trip.
  • Ordinary & Necessary Expense
annual board meeting
Annual Board Meeting
  • Fully deductible
  • Find a creative location
  • Successful people travel
the big deduction sec 179
The Big Deduction Sec. 179

This year:

$125,000 up to purchase of $500,000

family members as tax deductions
Family Members as Tax Deductions
  • Children: lower tax deductions
  • Spouse on payroll
  • Employee benefits
  • Retirement planning
employee education expenses
Employee Education Expenses
  • Seminars
  • Conferences
  • College tuition
employee benefits
Employee Benefits
  • Medical
  • Child Care
  • Life Insurance
  • Dental
  • Long Term Care
  • Chiropractic
business retirement plans
Business Retirement Plans
  • Pension, Sep 401K
  • Profit Sharing
  • Defined Benefit Plans
Retirement $




final thoughts
Final Thoughts
  • It’s Your $
  • Plan, Plan, Plan …
  • Take Action
alternative minimum tax
Alternative Minimum Tax
  • Background
  • Tax Preference Items
  • Sch. ‘A’ Taxes
  • Accelerated Depreciation
  • Capital Gains
  • To Avoid – Keep deductions on page 1 of return.
pension contribution changes
Pension Contribution Changes
  • Defined Benefit Plan
  • Max. Compensation Used = $225,000
  • Smaller of 100% of compensation or
  • $45,000
  • 401K
  • $15,500 & $5,000 catch up
  • SEP – Lesser of
  • 25% Income or $45,000
  • Traditional IRA –
  • Lesser of Compensation or $5,000
thank you
Thank You

For more information, visit

IncSmart.biz Inc