As most of you know, because of the 10% of AGI limitation, it has become harder and harder to deduct medical expenses on your individual tax return. Well, in certain circumstances you can still get a medical deduction. If you have a business where you are self-employed, you have an option to deduct your medical insurance on page one of your 1040 instead of as an itemized deduction. This is the “self-employed health insurance” provision of the tax code. There are some provisions you have to follow to get the deduction as follows: 1. YOU ARE A SOLE-PROPRIETOR OR A SINGLE PERSON LLC: If your business generates a profit, you can deduct your health insurance expense for you and your dependents on line 29 of your 1040 up to the profit of your business on line 12. 2. YOUR BUSINESS IS A PARTNERSHIP OR A REGULAR LLC: The health insurance should be paid or reimbursed to you through the entity you are a partner of. Once again, you can deduct the insurance on line 29 up the the profit from the business on your form K-1. 3. YOUR BUSINESS IS AN S-CORPORATION: If you are a shareholder of the corporation and [...]
Tax Musings of a Burbank CPA: IRS Me-F Efile System to Shut Down For Update
If you need to still efile your 2013, 2014 and 2015 individual and business tax returns, be aware that the IRS has finalized the Me-F efile production shutdown and cutover schedule for 2016-2017. Shutdown begins on Wednesday, November 30, 2016, at 11:59 a.m. in order to prepare the system for the upcoming Tax Year 2016 Filing Season. You need to transmit returns by 10:00 a.m. and receive acknoledgements by the 11:59 a.m. After that, the system cannot be accessed again until MeF reopens for 1040 MeF Production for Filing Season in 2017. You are also unable to efile 2013 after the shutdown and must paper file those returns. For more information, call or email me and we can discuss it. 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
Burbank CPA Tax Musings: Remember Your Auto Mileage Log or You May Regret it Later
If you are self employed or if you have a job where you drive a lot and don’t get reimbursed for mileage by your employer, make sure you keep a log of your automobile mileage each year. You need to calculate your business miles as a percentage of total miles annually, then use either the business miles at 54 cents a mile in 2016 or use the percentage to calculate your actual auto expense. If you get audited, your auto log (complete with beginning and ending odometer readings and the purpose of all the business travel daily) is the only piece of taxpayer prepared information that the IRS auditor is supposed to accept (but it doesn’t hurt to give the auditor a couple of auto repair bills that tie to the odometer readings that are in the log). I have been involved in many IRS audits where the automobile expenses were looked at by the auditor and I am pleased to say that to date I have never had a change to taxpayer auto expenses because of the mileage percentages (once we had a problem with some of the actual auto expense documentation, but if the taxpayer took the standard [...]