Is Your Documentation Enough to Pass a DCAA Incurred Cost Audit?
Is your documentation adequate to pass a Defense Contract Audit Agency (DCAA) incurred cost audit? Flexibly priced contracts contain audit and post-incurrence audit and acceptance requirements for some or all costs. Many contractors have been surprised to find out that the documentation they have on hand to support incurred costs is not considered adequate to…
Audits of Your Business Systems
Are you prepared for audits of your business systems? If you are not ready when notified of an impending business system audit, you will not have time to get ready. Many U.S. government contractors are expected to comply with contractual requirements for maintenance of adequate business systems. The Federal Acquisition Regulation (FAR) and Defense Federal…
IRS: Swap Your Vacation Home in Tax-Deferred Exchange
Many taxpayers own vacation homes that they’ve rented out and also used as their personal residences. Can one of these homes be traded for another vacation home in a tax-deferred Section 1031 exchange? According to the IRS, the answer is “yes” under the right circumstances. The IRS has even issued guidelines for how to do…
Can a Modest-Income Elderly Person Stop Filing Tax Returns?
As the Old Saying Goes: Better Safe than Sorry. As you know, we spend a lot of time in this e-newsletter talking about tax return filing responsibilities. But not everyone is required to file. If a person’s income falls below prescribed levels, he or she may not have to bother. However, as we’ll explain, it…
Know the Rules for Amending a Federal Income Tax Return
What should you do if you discover an error on a previously filed individual tax return? For example, you might have missed some tax-saving deductions and credits on your 2016 personal federal income tax return that you filed in February. Or you might have recently discovered that you failed to claim some legitimate tax breaks…
Structure Alimony Payments to Be Tax Deductible
Payments to an ex-spouse are often part of a divorce. If you find yourself in that boat, consider treating some or all of the payments as tax-deductible alimony. The drawback is that your ex must report the alimony as taxable income. The issue: Specific tax-law requirements must be met for payments to qualify as deductible alimony….
Business Lawsuits: Where Is Your State Ranked?
Multi-million dollar damage awards against businesses are not unusual in jury cases around the country. But there are states where courts are more business-friendly, including Delaware, Vermont and Nebraska, according to a survey done by the U.S. Chamber of Commerce. The Chamber’s Institute for Legal Reform (ILR) surveyed 1,203 general in-house counsel and other senior…
Tax Court Says Law Firm LLP Partners Owe Self-Employment Tax
The Internal Revenue Code’s self-employment (SE) tax provisions were enacted long before the existence of limited liability partnerships (LLPs). So there are questions about how to apply the SE tax rules to LLP partners. One Tax Court decision delivers some much-needed clarity, although it does not deliver news that is friendly to law firm partners….
Unlock the Biggest Possible Deduction for a Home Office
The IRS recently issued a reminder about claiming the home office deduction. In particular, it explained a simplified method that offers a time-saving option. But many taxpayers who maintain a home office fare better tax-wise by deducting expenses under the regular method. Others may not be eligible to deduct any home office expenses. Here’s why….
Get Up and Running After a Disaster
If your business is hit by a hurricane, windstorm, blizzard, or other natural disaster, or if it falls victim to arson or terrorism, you might have to close up shop for a while. As a result, you could suffer a major loss of income. One of the keys to continuing as a thriving enterprise after…