ESOPs – employee stock ownership plans – grant employees with ownership interests in their companies. These benefit plans were first introduced to C corporations in the 1950s, and their tax advantages were formally written into law when the Employee Retirement Income Security Act (ERISA) passed Congress in 1974. In the 1990s, they became available to S corporations, as well. They are not universally good options for all businesses, but many organizations can benefit from them.Read More
The IRS has issued new guidance updating the rules for using optional standard mileage rates when calculating “above-the-line” deductions for the costs of operating an automobile for certain purposes. IRS Revenue Procedure 2019-46 also lays out rules for establishing the amount of an employee’s transportation expenses that are reimbursed using the optional standard mileage rates.Read More
The AICPA Employee Benefit Plan Audit Quality Center (EBPAQC) has published a plan advisory called “The Importance of Hiring a Quality Auditor to Perform Your Employee Benefit Plan Audit.” This advisory was created for plan administrators to have a guide to follow the important process of hiring an auditor with the correct experience to audit employee benefit plans.Read More
Topics: Tax Planning & Strategies
As a result of the changes made by the Tax Cuts and Jobs Act, when they filed their 2018 tax returns, many taxpayers discovered that they are no longer itemizing their deductions. This means that the tax savings that previously resulted from their charitable contributions has disappeared. One way to recapture the tax benefits of charitable giving is to use a donor-advised fund to “bunch” charitable contributions. Using the donor-advised fund strategy also makes it more efficient to capture the tax benefits of donating long-term appreciated stock and simplifies the recordkeeping requirements for charitable contributions.Read More
Topics: Tax Planning & Strategies
The IRS recently issued its 2020 cost-of-living adjustments. With inflation remaining largely in check, many amounts increased slightly, and some stayed at 2019 levels. As you implement 2019 year-end tax planning strategies, be sure to take these 2020 adjustments into account in your planning.Read More
Retirement plan fiduciaries should meet on an annual basis (if not more frequently) to discuss the plan with outside service providers, including the investment advisor, custodian/trustee, and third-party administrator. In this blog, we’ll discuss the three best practices for your annual retirement plan review and what the focus of these meetings should include.
1. Investment Performance of the Funds in the PlanThe fiduciaries should determine if the funds in the plan are meeting the criteria outlined in the investment policy statement (IPS). Funds that are not meeting your stated criteria should be put on a watch list as outlined in the IPS or possibly removed from the plan, again depending on the IPS. In addition to reviewing fund performance, you’ll want to ensure that the group of funds that are offered in your plan are still meeting the requirements of the IPS. Read More
The IRS announced on November 6, that several contribution limits in qualified retirement plans will increase next year.
These limits cover cost of living adjustments to a variety of retirement plan limitations. The chart below provides a summary of the amounts for your convenience.Read More
The first tax-filing season under the Tax Cuts and Jobs Act (TCJA) was a time of uncertainty for many businesses as they struggled with the implications of the law’s sweeping changes for their bottom lines. With the next filing season on the horizon, you can incorporate the lessons learned into your year-end tax planning. Several areas in particular are ripe with opportunities to reduce your 2019 federal tax liability.Read More
Autumn has arrived and that means it’s time to turn your attention to year-end tax planning. While several clear strategies and tactics emerged during the first tax filing season under the Tax Cuts and Jobs Act (TCJA), 2019 and subsequent years bring potential twists that must be considered, too. Let’s take a closer look at year-end tax planning strategies that can reduce your 2019 income tax liability.Read More