Godbold & Romanov CPAs

Hiring your child at your business this summer? It can be a tax-smart idea. Here are the benefits.

Hiring your child to work at your business this summer - Godbold & Romanov CPAs With school out, you might be hiring your child to work at your company. In addition to giving your son or daughter some business knowledge, you and your child could reap some tax advantages. Benefits for your child There are special tax breaks for hiring your offspring if you operate your business....

Investing in mutual funds is popular, but selling shares may result in complicated tax matters. Here are the rules.

The tax consequences of selling mutual funds - Godbold & Romanov CPAs Do you invest in mutual funds or are you interested in putting some money into them? If so, you’re part of a large group. According to the Investment Company Institute, 116 million individual U.S. investors owned mutual funds in 2023. But despite their widespread use, the tax rules involved in sel...

An important deadline for quarterly federal estimated tax payments is coming up on June 17. Here are the methods for computing payments for corporations.

Figuring corporate estimated tax - Godbold & Romanov CPAs The next quarterly estimated tax payment deadline is June 17 for individuals and businesses, so it’s a good time to review the rules for computing corporate federal estimated payments. You want your business to pay the minimum amount of estimated tax without triggering the penalty for underpaymen...

If you’re 62 or older and own a highly appreciated house, a reverse mortgage may provide a way to stay in the home for your lifetime, get some income and receive a tax-saving bonus.

House rich but cash poor? Consider a reverse mortgage strategy - Godbold & Romanov CPAs Are you an older taxpayer who owns a house that has appreciated greatly? At the same time, you may need income. Thankfully, there could be a solution with a tax-saving bonus. It involves taking out a reverse mortgage. Reverse mortgage basics With a reverse mortgage, the borrower doesn’t make payme...

Does your business provide Health Savings Accounts to employees? The IRS recently announced the inflation-adjusted amounts for 2025. Here they are, along with the benefits of these accounts.

Inflation enhances the 2025 amounts for Health Savings Accounts - Godbold & Romanov CPAs The IRS recently released guidance providing the 2025 inflation-adjusted amounts for Health Savings Accounts (HSAs). These amounts are adjusted each year, based on inflation, and the adjustments are announced earlier in the year than other inflation-adjusted amounts, which allows employers to get re...

If you’re caring for an elderly relative, you may be entitled to some tax breaks. Here are four of them.

You may be entitled to tax breaks if caring for an elderly relative - Godbold & Romanov CPAs There are many rewards for taking care of an elderly relative. They may include feeling needed, making a difference in the person’s life and allowing the person to receive quality care. In addition, you could also be eligible for tax breaks. Here’s a rundown of four of them: 1. Medical expenses....

There are several factors to consider when converting from a C corporation to an S corporation. Here are four of the tax issues you may face.

Should you convert your business from a C to an S corporation? - Godbold & Romanov CPAs Choosing the right business entity has many implications, including the amount of your tax bill. The most common business structures are sole proprietorships, partnerships, limited liability companies, C corporations and S corporations. In some cases, a business may decide to switch from one entit...

If you’re fortunate enough to own vacant land that has appreciated greatly, you may want to sell it. But how much will you pay in tax and is there any way to reduce the tax bill? Here’s a strategy to consider.

A three-step strategy to save tax when selling appreciated vacant land - Godbold & Romanov CPAs Let’s say you own one or more vacant lots. The property has appreciated greatly and you’re ready to sell. Or maybe you have a parcel of appreciated land that you want to subdivide into lots, develop them and sell them off for a big profit. Either way, you’ll incur a tax bill. For purposes of [...

When buying a business, you may not focus on taxes. But the way the transaction is structured can lead to better or worse tax results after the acquisition.

Tax tips when buying the assets of a business - Godbold & Romanov CPAs After experiencing a downturn in 2023, merger and acquisition activity in several sectors is rebounding in 2024. If you’re buying a business, you want the best results possible after taxes. You can potentially structure the purchase in two ways: In this article, we’re going to focus on buying as...

If you donate valuable assets to charity and don’t follow certain requirements, the charitable tax deduction may be denied. Here are some answers to questions about how to protect your deductions.

When do valuable gifts to charity require an appraisal? - Godbold & Romanov CPAs If you donate valuable items to charity and you want to deduct them on your tax return, you may be required to get an appraisal. The IRS requires donors and charitable organizations to supply certain information to prove their right to deduct charitable contributions. How can you protect your deduct...

There are potential federal income tax advantages when you include debt in the capital structure of a C corporation. Here’s a rundown.

The tax advantages of including debt in a C corporation capital structure - Godbold & Romanov CPAs Let’s say you plan to use a C corporation to operate a newly acquired business or you have an existing C corporation that needs more capital. You should know that the federal tax code treats corporate debt more favorably than corporate equity. So for shareholders of closely held C corporations,...

There are a number of different hobbies that some taxpayers turn into businesses. Here’s how they can protect tax breaks on their tax returns.

Pay attention to the tax rules if you turn a hobby into a business - Godbold & Romanov CPAs Many people dream of turning a hobby into a regular business. Perhaps you enjoy boating and would like to open a charter fishing business. Or maybe you’d like to turn your sewing or photography skills into an income-producing business. You probably won’t have any tax headaches if your new busine...

If you’re adding a new partner to your partnership, you may think the tough part is over once you find the right person. But there could be complex tax issues to consider.

Growing your business with a new partner: Here are some tax considerations - Godbold & Romanov CPAs There are several financial and legal implications when adding a new partner to a partnership. Here’s an example to illustrate: You and your partners are planning to admit a new partner. The new partner will acquire a one-third interest in the partnership by making a cash contribution to the busin...

If you own a vacation home, perhaps you’re ready to sell it. What are the tax implications? Here are the rules if you sell at a profit.

Taxes when you sell an appreciated vacation home - Godbold & Romanov CPAs Vacation homes in upscale areas may be worth way more than owners paid for them. That’s great, but what about taxes? Here are three scenarios to illustrate the federal income tax issues you face when selling an appreciated vacation home. Scenario 1: You’ve never used the home as your primary res...

Property you inherit generally isn’t included in income for tax purposes. However, there are certain items that may have to be included. Here’s the story.

Watch out for “income in respect of a decedent” issues when receiving an inheritance - Godbold & Romanov CPAs Most people are genuinely appreciative of inheritances, and who wouldn’t enjoy some unexpected money? But in some cases, it may turn out to be too good to be true. While most inherited property is tax-free to the recipient, this isn’t always the case with property that’s considered income in r...

If you’re a partner in a partnership business, can you deduct expenses you incur on your personal tax return? Here are the rules.

When partners pay expenses related to the business - Godbold & Romanov CPAs When partners pay expenses related to the business It’s not unusual for a partner to incur expenses related to the partnership’s business. This is especially likely to occur in service partnerships such as an architecture or law firm. For example, partners in service partnerships may incur enter...

Businesses: Do you expect federal income tax rates to go up, go down or stay the same in the future? If you think your rates could go up, here are some considerations.

When businesses may want to take a contrary approach with income and deductions - Godbold & Romanov CPAs Businesses usually want to delay recognition of taxable income into future years and accelerate deductions into the current year. But when is it wise to do the opposite? And why would you want to? One reason might be tax law changes that raise tax rates. The Biden administration has proposed raising...

Home selling (and buying) season is heating up. At the same time, rents are high in many parts of the country. What are the tax implications if you buy another home but decide to keep your current home and rent it out?

The pros and cons of turning your home into a rental - Godbold & Romanov CPAs If you’re buying a new home, you may have thought about keeping your current home and renting it out. In March, average rents for one- and two-bedroom residences were $1,487 and $1,847, respectively, according to the latest Zumper National Rent Report. In some parts of the country, rents are much ...

If you’re a business owner without a retirement plan, establishing one is simpler than you may think. And there still may be time to set one up for LAST year, depending on your situation.

Don’t have a tax-favored retirement plan? Set one up now - Godbold & Romanov CPAs If your business doesn’t already have a retirement plan, it might be a good time to take the plunge. Current retirement plan rules allow for significant tax-deductible contributions. For example, if you’re self-employed and set up a SEP-IRA, you can contribute up to 20% of your self-employment e...

Once your 2023 tax return has been filed, you can breathe a sigh of relief. But there still may be some tax issues to consider. Here are three of them.
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A meticulous approach to maintaining business records can help protect your tax deductions and make an IRS audit much less difficult. Here’s a recent court case illustrating some of the issues involved.

Scrupulous records and legitimate business expenses are the key to less painful IRS audits - Godbold & Romanov CPAs If you operate a business, or you’re starting a new one, you know records of income and expenses need to be kept. Specifically, you should carefully record expenses to claim all the tax deductions to which you’re entitled. And you want to make sure you can defend the amounts reported on your tax...

Spring is here, along with a bunch of tax-related deadlines. Here are some upcoming dates for the second quarter of 2024 that businesses and employers should keep in mind.

2024 Q2 tax calendar: Key deadlines for businesses and employers - Godbold & Romanov CPAs Here are some of the key tax-related deadlines that apply to businesses and other employers during the second quarter of 2024. Keep in mind that this list isn’t all-inclusive, so there may be additional deadlines that apply to you. Contact us to ensure you’re meeting all applicable deadlines and...

The SECURE 2.0 law includes good news about required minimum distributions from tax-favored retirement accounts. But an earlier law contained some bad news for certain beneficiaries of inherited retirement accounts. Here are the rules.

Update on retirement account required minimum distributions - Godbold & Romanov CPAs If you have a tax-favored retirement account, including a traditional IRA, you’ll become exposed to the federal income tax required minimum distribution (RMD) rules after reaching a certain age. If you inherit a tax-favored retirement account, including a traditional or Roth IRA, you’ll also hav...

There’s more than one way for businesses to claim depreciation tax deductions. By combining them, you can get optimal tax-saving results.

Coordinating Sec. 179 tax deductions with bonus depreciation - Godbold & Romanov CPAs Your business should generally maximize current year depreciation write-offs for newly acquired assets. Two federal tax breaks can be a big help in achieving this goal: first-year Section 179 depreciation deductions and first-year bonus depreciation deductions. These two deductions can potentially ...

Many people who own vacation homes rent them out to earn extra income. Even better, renting them out may provide tax breaks. Here are the rules.

How renting out a vacation property will affect your taxes - Godbold & Romanov CPAs Are you dreaming of buying a vacation beach home, lakefront cottage or ski chalet? Or perhaps you’re fortunate enough to already own a vacation home. In either case, you may wonder about the tax implications of renting it out for part of the year. Count the days The tax treatment depends on how ma...

If your small business would like to exchange goods and services without exchanging money, you may be able to barter. The internet makes it easier to engage with other businesses. But if you barter, be aware of the tax consequences.

Bartering is a taxable transaction even if no cash is exchanged - Godbold & Romanov CPAs If your small business is strapped for cash (or likes to save money), you may find it beneficial to barter or trade for goods and services. Bartering isn’t new — it’s the oldest form of trade — but the internet has made it easier to engage in with other businesses. However, if your business ...

Many retirees are surprised to find out that some of their Social Security benefits are hit with federal income tax. Will you be one of them? Here are the rules.

Beware of a stealth tax on Social Security benefits - Godbold & Romanov CPAs Some people mistakenly believe that Social Security benefits are always free from federal income tax. Unfortunately, that’s often not the case. In fact, depending on how much overall income you have, up to 85% of your benefits could be hit with federal income tax. While the truth about the federal...

The qualified business income (QBI) deduction is scheduled to disappear after 2025. Congress could extend it, but don’t count on it. Here’s what you need to know to make the most of it while you can.

Maximize the QBI deduction before it’s gone - Godbold & Romanov CPAs The qualified business income (QBI) deduction is available to eligible businesses through 2025. After that, it’s scheduled to disappear. So if you’re eligible, you want to make the most of the deduction while it’s still on the books because it can potentially be a big tax saver. Deduction basi...

Losing your job doesn’t mean putting tax issues in the rear-view mirror. There can be tax implications to a layoff or termination. Be aware of these three areas.

A job loss is bad but the tax implications could make it worse - Godbold & Romanov CPAs Unemployment has been holding steady recently at 3.7%. But there are still some people losing their jobs — particularly in certain industries including technology and media. If you’re laid off or terminated from employment, taxes are likely the last thing on your mind. However, there are tax imp...

It’s not unusual for parents to end up with unused funds in their children’s 529 college savings plans. There’s a new option that allows them to transfer unused funds in a 529 plan to a Roth IRA. Here are the details.

New option for unused funds in a 529 college savings plan - Godbold & Romanov CPAs With the high cost of college, many parents begin saving with 529 plans when their children are babies. Contributions to these plans aren’t tax deductible, but they grow tax deferred. Earnings used to pay qualified education expenses can be withdrawn tax-free. However, earnings used for other purp...