Numbers - Notes - Links
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EmployersYou must get a new W-4 (available here):
* Every new hire * Annually * Change of withholding request IN requires that you report all new hires (information here) You must maintain up to date posting of employee information * You do not need to purchase those posters that come in the mail - free posters are available at government sites Indiana Employer Posting Requirements Federal Employer Posting Requirements - we will provide what you need for a very small fee |
Handy Info Sheets and Checklists |
Section 179 Dollar Limitation
2022 - $1,080,000 (autos have special guidelines)
The new law also expands the definition of section 179 property to allow the taxpayer to elect to include the following improvements made to nonresidential real property after the date when the property was first placed in service:
The new law also expands the definition of section 179 property to allow the taxpayer to elect to include the following improvements made to nonresidential real property after the date when the property was first placed in service:
- Qualified improvement property, which means any improvement to a building’s interior. However, improvements do not qualify if they are attributable to:
- the enlargement of the building,
- any elevator or escalator or
- the internal structural framework of the building.
- Roofs, HVAC, fire protection systems, alarm systems and security systems.
529 Plan - $1,000 refundable Indiana credit* MUST BE AN INDIANA PLAN
* No income limitation * $1,000 per year * Withdrawals immediately available for qualified expenses * Beginning in 2018 - $10,000/year can be used for qualified private school- related expenses |
Standard Business Mileage Rates2023 - 65.5 cents
NOTE: 18 cents per mile driven for medical 14 cents per mile driven for charitable organizations History Lesson: 2022 - 58.5 cents (1/1 - 6/30) 2022 - 62.5 cents (7/1 - 12/31) 2021 - 56.0 cents 2020 - 57.5 cents 2019 - 58.0 cents 2018 - 54.5 cents 2017 - 53.5 cents 2016 - 54.0 cents 2015 - 57.5 cents 2014 - 56 cents 2013 - 56.5 cents 2012 - 55.5 cents 2011 - 51 cents (1/1 - 6/30) 2011 - 55.5 cents (7/1 - 12/31) 2010 - 50 cents 2009 - 55 cents |
Hot Topics
Entertainment is no longer a deduction - period - it's gone!
Meals: Buy from a restaurant and deduct 100% in 2021 & 2022
Not all expenses qualify for deduction - talk to us about the rules on the following (and more!)
* Record keeping requirements
* Business meal receipts must have documentation of: Cost & Attendees
* Purpose (must create a reasonable expectation on increasing revenues, etc)
* Eating at work does not make it a deduction
* Talking about or mentioning work issue does not make it a deduction
* Out-of-town meal per diems are prorated for travel times
Various limitations
* Typically only 50% of deduction is allowable
* Transportation industry has a higher percent allowable
Not all expenses are subject to limitation
* 2018 CHANGE - Employee meals on work site, for benefit of employer are NOW limited to 50%
* Holiday or special event gatherings
* Office snacks and drinks
* Business meal receipts must have documentation of: Cost & Attendees
* Purpose (must create a reasonable expectation on increasing revenues, etc)
* Eating at work does not make it a deduction
* Talking about or mentioning work issue does not make it a deduction
* Out-of-town meal per diems are prorated for travel times
Various limitations
* Typically only 50% of deduction is allowable
* Transportation industry has a higher percent allowable
Not all expenses are subject to limitation
* 2018 CHANGE - Employee meals on work site, for benefit of employer are NOW limited to 50%
* Holiday or special event gatherings
* Office snacks and drinks
Employee vs. Sub Contractor
If your subcontractor tells their preparer they were an employee but you failed to hold and pay taxes, there is a form they can complete that will allow them to only pay 1/2 (employee share) of FICA and the IRS will come back on you for your share PLUS penalties and interest.
The IRS has many factors used in the determination of classification, such as:
- Freedom of choice on accepting assignment
- Risk of loss if job is not completed as expected
- Schedule control
- Provider of tools and supplies
- Level of instruction and oversight of how work is performed
- Classification of others doing same activities
- Is worker allowed to delegate
- Number of "people" the worker earns money from
If you are on the losing end of a reclassification by the IRS, expect NO MERCY.
Sales Tax - Use Tax
If sales tax is included in the price, it must be stated at the time of sale
New exemption certificates are required each year
Audits require certificates to cover the year being reviewed
Just because tax is not charged does not mean you don't owe it
* Paying Sales tax is your responsiblity, failing to pay results in Use Tax Liability
Indiana holds purchaser responsible for
* Magazines
* Ebay and/or internet purchases
* Maintenance agreements
* Out of state purchases
Hobby or Business - The IRS Will Decide
IRS is hot on this. If you make money from a hobby, losses are limited to the income made and only deductible for Federal (and only if you itemize), not Indiana, but income is taxable to both.
Commonly reviewed types:
* Racing
* 4-H farming
* Flea-marketing sales
* Internet sales of personal items
Making money does not make it a business
Do you have reasonable expectation of activity providing your financial support
Would you continue activity even if you knew you would not make money
Do you operate it as a business
Check out more info on this on: Business vs. Hobby