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Business Tax

Learn from Uber – Protect yourself from contractor vs employee audits!

 

YES, Employee audits IS A THING! Let our Jacksonville, FL CPA Assist You with Classification & Compliance

  • Am I correctly classifying my contractors?Employees vs Independent Contractors

  • Are my contractors really employees?

  • What are the risks involved, and

  • How do I make sure I stay compliant with the employment laws?

 

These are the questions, as small business owners, we ask ourselves – or should be! In the ever-changing business taxation environment, this question of a contractor vs. employee classification, in Jacksonville and outside our local geographic area, has remained relevant for a good portion of the past decade. And even today, when it feels like the entire world has been turned upside down, and all rules seem to have been broken, this remains a current and relevant topic for us to worry about.

California developments:

California, always a leader in adopting tax reform, is actively pursuing contractor vs. employment classification – and MIS-classification. This year, if you hire a person in the same line of work as your business, you MUST classify them as employees. Most prominently, that means that the thousands of Uber and Lyft drivers are now required to be classified as employees; no longer are they considered independent contractors, no longer can they file a Schedule C and claim business expenses. They will be forced to convert to the companies’ employees, as has just been confirmed by the Appeals Court in CA.

But this ruling affects many others, not just the Uber and Lyft drivers as seen throughout California, small business owners such as beauty salon owners, insurance agencies, contractors, restaurant owners – are learning that the workforce they have traditionally classified as independent contractors are now legally their employees, with all the consequences that bring about.

What this means to small business owners in other states:

Does this affect others living and working outside of California? Absolutely, you bet your sweet….bottom! You see, California has always been at the forefront of tax reform. Other states are quick to jump on this bandwagon. At the same time, others will also look to the Gold Rush State in how the independent subcontractors are to be treated very shortly! States already starting to follow in the trailblazer’s path include New York, New Jersey, and Illinois – each planning its own version of the legislation affecting the classification of the freelance workers.

What’s the difference:

As a small business owner, be responsible if you were to classify these freelancers as employees in an audit? Layers of taxation and compliance vary from state to state, and the main compliance points would be:

  • The employer portion of Social Security and Medicare taxes
  • Unemployment insurance
  • Workers’ Compensation
  • Local labor laws
  • Federal and State payroll tax filings

Schedule a consultation with a Jacksonville, FL Small Business Accountant:

There may be more, but these consideration points are pretty universal, and you should be aware of it. If you think you may need to re-think your independent contractor employee classification,  reach out to our Jacksonville CPA firm for a consultation. You may call us at 904-330-1200 or email at info@taxproff.com.

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07 / 11 / 2019 by Greg Freyman, CPA in Business Tax

How Tax Planning Can Save You from Unnecessary Stress

Tax planning is a procedure for reviewing various options for conducting business and personal transactions to reduce tax liability.

Tax planning may result in substantial tax savings.

We will discuss ways to reduce tax liability:

– Income that is subject to taxation

– Making the most deductions and tax credits

– How investing impacts tax planning

– Tax savings through retirement contributions

– Education incentives

– Business and tax planning

– Strategies for the self-employed taxpayers

– Estimated tax

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07 / 11 / 2019 by Greg Freyman, CPA in Business Tax

Seven Basic And Simple Steps To Forming An LLC In Florida

Leaving a job and starting as a business owner is a big step. There are many variables to consider when deciding to go on your own. Here we will discuss some less familiar topics that deal with forming an LLC in Florida.

 

Consider whether you need to form a legal entity altogether.

 

Ensure you are forming the LLC for the right reasons. The main reasons why someone would choose to form an LLC are:

a) formality

b) professional association

c) legal protection

d) tax purposes

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15 / 10 / 2019 by Greg Freyman, CPA in Business Tax

Tangible Personal Property Tax

Some great lines from the 1980 movie Popeye with some of my favorite actors, Robin Williams and Shelley Duvall

Popeye

The Tax Man:
You just docked?

Popeye:
I has.

The Tax Man:
Ah ha, let’s see here, that’ll be 25¢ docking tax.

Popeye:
What for?

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Real Estate Investing Tax Strategies

By Greg Freyman, CPA and Angela Freyman, MBA

“Real estate cannot be lost or stolen, nor can it be carried away. Purchased with common sense, paid for in full, and managed with reasonable care, it is about the safest investment in the world”
~ Franklin D. Roosevelt

There are so many fascinating aspects to real estate. In this edition we will briefly go over important information on financial and tax topics of real estate as personal and investment use.

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31 / 07 / 2018 by Angela Freyman in Business Tax

Tax Reform and S Corporation Reasonable Compensation

The 2018 tax reform known as the Tax Cuts and Jobs Act (TCJA) allows for a new 20 percent deduction on certain business income, known as the Section 199A deduction. One should have the right type of business and the right taxable income.

In our past blog article Christmas Came Early In 2018, we discussed different choices in conducting business when it came to taxation and the new tax legislation in great detail. We also explained the differences in taxation of each business entity structure, and if you have been paying attention, you will recall that the S corporation is a pass-through entity which is typically a great choice for most small business owners.

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22 / 04 / 2018 by onTy Toom in Business Tax

Business Entertainment and Meals – Changes to Deductions

Dear Clients and Colleagues,

As we wrote in our prior blogs, tax reform has had a significant impact on the tax deductions you can now claim for business entertainment and meals.

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30 / 12 / 2017 by Greg Freyman, CPA in Business Tax

Christmas Came Early In 2018: The New Tax Legislation

“Thankfulness is the beginning of gratitude. Gratitude is the completion of thankfulness. Thankfulness may consist merely of words. Gratitude is shown in acts.” —Henri Frederic Amiel

Before we put you all to sleep with a lot of boring tax talk, let’s simply say that great things are about to come that will surely stimulate the economy in more ways than meets the eye at first glance.

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08 / 03 / 2017 by Angela Freyman in Business Tax

Partnership Agreement Issues

We deal with agreements on a daily basis — from the terms and conditions on a website to municipal regulations that guide public actions. These agreements are often forgotten, if not entirely ignored, which may only become apparent when an issue arises. Similarly, partnership agreements may be drafted and then ignored. Partnership agreements guide many aspects of the partnership, including important tax consequences. Unless you have a legal background, you may have retained an attorney’s help when your partnership drafted its partnership agreement. What you may not have considered at the time was having a CPA review the agreement.

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2016 Year-End Update for Businesses

This blog post covers 2016 year-end update for businesses. With the start of 2017 quickly approaching, a slew of changes is upon us. The new year often brings tax changes, and with a new president in 2017 there is already talk of overhaul of the tax code. While we will briefly discuss some speculative changes for 2017, most of the changes discussed below have already been approved by Congress and will be in effect for 2017.

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