Tax Musings of a Burbank CPA: Reminder about Corporate and Partnership Extensions

Ok, this is a reminder that S-Corporation and Partnership extensions will expire on September 15, so after today there are only 15 days to file. You also need to remember that C-Corporation extensions now expire this year on October 16, the same as personal extensions.  You have an extra month to file this year. Make sure you file by these dates as the IRS penalizes severely if you are late.    For financial,  accounting and tax musings, You can count on us to count for you! Email: bstonercpa@sbcglobal.net  Phone: 818-317-6035   Website: www.briantstonercpa.com AWARDED BEST ACCOUNTANT IN BURBANK, CA BY BEST BUSINESSES 2016, 2015 AND 2014!   Android and the IPhone:    Has been Featured On   https://twitter.com/bstonercpa

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Tax Musings of a Burbank CPA: What Is Reasonable Compensation?

For small businesses formed as an S Corporation and with plenty of profits, reasonable compensation is a term you may want to be familiar with.   Many small businesses have organized as an S Corporation form of entity.  In many cases, the S Corp election allows a business owner to save money on self-employment taxes, especially if they are operating as a sole proprietor.  S Corp profits, or distributions, are not subject to payroll taxes.  If you are a business owner taking a salary and contributing substantially to the operations of the business, you may think that you should just take the distributions and forget the salary.  After all, think how much you would save in payroll taxes.  But this has already been tried and shot down by the IRS in the courts.  And this is where the term reasonable compensation comes in.  The IRS requires that business owners that perform a substantial contribution to the business be paid a salary according to a number of factors.  This is called reasonable compensation. You can’t pay yourself below market and take a large amount in distributions.   The IRS has issued a fact sheet that describes the guidelines that can be used to [...]

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Musings of a Burbank CPA: Is It Profitable to Blog?

One of the many online marketing options available for businesses is blogging. A blog can act as a company’s daily newspaper, letting customers and followers know the latest news about what’s happening. It can also be a wonderful revenue-generator. As long as the content of your blog is relevant to your readers, you can post on a wide variety of topics. You might want to let clients know about an upcoming sale, a new employee, or a tip related to a product or service of yours. Some businesses make a separate revenue stream out of blogging. The most profitable blog today is the Huffington Post. Revenue from blogging can be earned in many ways: By selling ad space to people who want to get their products in front of people who read your blog From sponsors By holding events your readers attend From commissions from the sale of products on your site By creating products and services such as membership sites which allow paid access to your resources Making money from blogging through one of these revenue streams takes work. Not only do you have to find or create content, you’ll need to attract readers too. You can also simply [...]

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