Employee’s Report of Tips to Employer Do employers have to pay taxes on tips? According to the Internal Revenue Service (IRS), employers are responsible for paying taxes on employee tips. However, employers are not required to withhold taxes on tips if the employee has already reported the tips to the IRS. Do waitresses claim all … Read more
What is a Deferred Tax Liability? A deferred tax liability is a tax liability that is not payable immediately, but rather at some point in the future. This can happen when a company has income that is taxable in the future, but not currently. The most common example of this is when a company has … Read more
The term “IRS Publication 519 Definition” refers to the definition of a “qualified individual” as set forth in IRS Publication 519, “U.S. Tax Guide for Aliens.” A qualified individual is an alien who is a citizen or national of the United States, a resident alien of the United States, or a nonresident alien who meets … Read more
The Unrecaptured Section 1250 Gain Definition is the portion of the gain from the sale of certain business real property that is not subject to recapture under Section 1250 of the Internal Revenue Code. This gain is often referred to as “unrecaptured 1250 gain.” How is unrecaptured 1250 gain calculated? In order to calculate your … Read more
The material participation tests are a set of IRS rules that determine whether an individual is considered to be materially participating in a business activity. There are four tests that can be used to determine material participation, and an individual must meet at least one of them in order to be considered materially participating. The … Read more
The Alternative Minimum Tax (AMT) is a tax that is imposed on taxpayers who have certain types of income that are not subject to the regular income tax. The AMT is designed to ensure that these taxpayers pay at least a minimum amount of tax. The AMT is imposed at a rate of 26% on … Read more
Dividend imputation is a system of corporate taxation used in Australia and New Zealand. Under dividend imputation, a company’s shareholders are taxed on the company’s profits, and the company receives a tax credit for any tax paid by the company on those profits. This system is designed to prevent double taxation of corporate profits. In … Read more
Voluntary compliance with the tax laws is the cornerstone of the self-assessment system. It is crucial to the success of self-assessment that taxpayers voluntarily comply with their tax obligations. Voluntary compliance means that taxpayers comply with the tax laws without the need for the IRS to constantly monitor and enforce compliance. The IRS relies on … Read more
The term “not for profit” refers to an organization that does not earn a profit for its shareholders or owners. Instead, any money earned by the organization is used to further its goals or mission. Not-for-profit organizations are often formed to provide a service or to advocate for a cause. There are many different types … Read more
Reinvestment refers to the use of capital gains from the sale of an asset to purchase additional shares or units in the same or a similar investment. The reinvestment of capital gains allows investors to compound their returns and increase their overall investment returns. Many investment funds offer investors the option to reinvest their capital … Read more
