If you pay premiums for Medicare health insurance, you may be eligible to claim them as an itemized deduction for medical expenses on your tax return. This can also include premiums for “Medigap” insurance and Medicare Advantage plans, which help cover costs that Medicare Parts A and B don't. To qualify, you generally need to itemize deductions, and your total medical expenses must exceed 7.5% of your adjusted gross income (AGI). However, if you're self-employed or a shareholder-employee of an S corporation, you may be eligible to claim an "above-the-line" deduction for your health insurance premiums, including Medicare. This option allows you to receive tax benefits without needing to itemize deductions. It's important to review your options carefully, as Medicare premiums may offer significant tax savings. Contact our office for guidance on claiming medical expense deductions and to develop a tax strategy that fits your individual situation: CLICK HERE or CALL (412)875-5719

In today’s challenging economic climate, businesses can benefit significantly from tax incentives and sales tax exemptions. However, many of these opportunities go unclaimed due to a lack of awareness or misconceptions about eligibility. Here are some key tax credits and exemptions that your business might qualify for: 1. Statutory Incentives Certain tax credits are available “as of right,” meaning that if your business meets the necessary criteria, you can claim them on a timely filed tax return without negotiation. These incentives are designed to encourage businesses to engage in specific activities or invest in economically distressed areas. Work Opportunity Tax Credit (WOTC): This federal credit ranges from $2,400 to $9,600 per eligible new hire from disadvantaged groups, such as veterans, welfare recipients, convicted felons, and workers with disabilities. To claim this credit, businesses must complete the necessary paperwork. Research and Development (R&D) Tax Credits: Both state and federal R&D credits may be available to businesses that invest in developing new products, improving processes, or developing internal-use software. The federal credit can be as high as 20% of qualified research expenses over a base amount. Even businesses with no tax liability can carry the credit forward, and start-ups can claim it against up to $500,000 in employer-paid payroll taxes. Empowerment Zone Incentives: Companies operating in federally designated “empowerment zones” can receive tax credits worth up to $3,000 for each eligible employee. Industry-Based and Investment Credits: Various states offer credits to attract certain types of industries, such as manufacturing or film production. Investment credits are also available for capital investments made within state borders. 2. Discretionary Incentives Discretionary tax incentives must be negotiated with government officials. These benefits are typically offered to businesses that promise to bring economic value to a state or locality, such as creating jobs or boosting revenue. Discretionary incentives might include income and payroll tax credits, property tax abatements, and even reductions in utility rates. 3. Sales Tax Exemptions In states with sales taxes, exemptions are often available for certain business purchases. Common examples include: Purchases by retailers for resale, Manufacturers buying equipment, raw materials, or components for use in the manufacturing process, Specific tax-exempt entities, and Agricultural businesses purchasing farming equipment, seeds, fuel, or chemical sprays. To take advantage of these exemptions, businesses may need to prove eligibility by providing resale or exemption certificates to sellers. Don’t Miss Out on These Opportunities Each year, numerous tax credits and incentives go unclaimed simply because businesses are unaware of them or mistakenly believe they’re not eligible. There are many more credits and exemptions available beyond the examples listed here. To ensure your business receives all the tax benefits it deserves, contact our office for guidance on claiming these valuable incentives and developing a tax strategy tailored to your business’s needs. CLICK HERE or CALL (412)875-5719

UPCOMING TAX DEADLINES September 16 Individuals : Pay the third installment of 2024 estimated taxes (Form 1040-ES), if not paying income tax through withholding or not paying sufficient income tax through withholding. Calendar-year corporations : Pay the third installment of 2024 estimated income taxes, completing Form 1120-W for the corporation’s records. Calendar-year S corporations : File a 2023 income tax return (Form 1120-S) and provide each shareholder with a copy of Schedule K-1 (Form 1120S) or a substitute Schedule K-1 if an automatic six-month extension was filed. Pay any tax, interest and penalties due. Calendar-year S corporations : Make contributions for 2023 to certain employer-sponsored retirement plans if an automatic six-month extension was filed. Calendar-year partnerships : File a 2023 income tax return (Form 1065 or Form 1065-B) and provide each partner with a copy of Schedule K1 (Form 1065) or a substitute Schedule K1 if an automatic six-month extension was filed. Employers : Deposit Social Security, Medicare and withheld income taxes for August if the monthly deposit rule applies. Employers : Deposit nonpayroll withheld income tax for August if the monthly deposit rule applies. September 30 Calendar-year trusts and estates : File a 2023 income tax return (Form 1041) if an automatic five-and-a-half-month extension was filed. Pay any tax, interest and penalties due. October 10 Individuals : Report September tip income of $20 or more to employers (Form 4070). October 15 Individuals : The last day to file an extended 2023 tax return and pay any tax, interest, or penalties due.

As the summer season approaches, it's the perfect time to not only soak up the sun but also to ensure your finances are in check. Here are 10 budgeting tips designed to help you make the most of your summer while staying on track with your financial goals and objectives. Budget for Vacations: Plan your summer vacations in advance and budget accordingly. Allocate funds for transportation, accommodation, meals, and activities. Consider using travel rewards or loyalty points to offset costs. Book time during shoulder seasons. Save on Energy Costs: As temperatures rise, energy bills can increase. Take steps to save on energy costs by using fans instead of air conditioning, investing in energy-efficient appliances, and turning off lights and electronics when not in use. Plan Affordable Activities: Enjoy the summer without overspending by seeking out free or low-cost activities in your area, such as outdoor concerts, picnics in the park, hiking trails, or visiting local museums and attractions on discounted days. Maximize Outdoor Entertaining: Host budget-friendly gatherings with friends and family by organizing outdoor picnics, barbecues, or potluck dinners. Pool resources, share responsibilities, and enjoy the company without breaking the bank. Review Insurance Coverage: Take time to review your insurance policies, including homeowners, renters, auto, and travel insurance. Ensure you have adequate coverage for summer activities, such as water sports or road trips, and explore opportunities to save on premiums. Summer Job Opportunities: Consider taking on seasonal or part-time employment during the summer months to supplement your income. Look for opportunities in industries such as hospitality, tourism, landscaping, or event planning. Stay on Top of Financial Goals: Use the summer as an opportunity to revisit your financial goals and track your progress. Adjust your budget, savings contributions, and investment strategies as needed to stay on target. Utilize Seasonal Sales: Take advantage of summer sales and promotions to purchase items you need at discounted prices, such as outdoor furniture, sporting equipment, or clothing for the upcoming school year. Plan for Back-to-School Expenses: Start planning and budgeting for back-to-school expenses, including supplies, clothing, and extracurricular activities. Look for sales, coupons, and second-hand options to save on costs. Review Your Investment Portfolio: Use the summer months to review your investment portfolio and rebalance if necessary. Consider any life changes or market developments that may impact your investment strategy and make adjustments accordingly.

There are some important upcoming changes that might affect your financial planning. There's a big shift happening regarding estate and gift taxes, and it's something that needs to be considered sooner rather than later. Starting in 2026, there will be a significant decrease in the estate and gift tax basic exclusion, essentially cutting it in half. This means that if you're thinking about transferring ownership of your assets, now might be the time to do it. While some are hoping Congress will extend the doubled exclusion, realistically, this might not happen. Waiting until the last minute could leave you scrambling, both mentally and legally. Setting up trusts and transferring assets takes time, and affected clients will want to avoid any last-minute rush. Currently, the exclusion stands at $13,610,000, but after January 1, 2026, it drops to around $7 million. That's a significant change that could affect your estate planning and potential tax liabilities. By taking action now, you could potentially save a substantial amount in estate taxes. When we talk about transferring assets, it's essential to understand the implications. Transferring assets during your lifetime means the recipient inherits your basis, while holding onto them until death allows for a basis step-up for your heirs. This difference could influence your decision-making process. At Stevans & Associates, we want to make sure you have all the information you need to make these decisions. That's why it's crucial to start planning now and not wait until the last minute. Let's work together to evaluate your estate planning situation and determine the best course of action for you and your family. Please get in touch with a tax planner at our office to discuss the best options for your situation: (412)875-5719 Many other tax laws are anticipated to change after December 31, 2025 that may affect you. We will highlight each of these changes in future articles.

Tax Day has come and gone, but if an extension was filed, your new filing deadline is Tuesday, October 15, 2024. So, what next? Don't procrastinate. While, an extension moves the filing deadline it does NOT move the payment deadline. If you owe taxes, that money was still due by April 15th. We encourage you to pay an estimate of what is owed, to limit interest and penalties. If you cannot pay your taxes in full, the IRS recommends pay what you can and set up an installment plan. Reach out to your tax advisor for help with this process. If you are on extension and pay quarterly estimates, please remember your Q2 payments are due June 15, 2024 and Q3 estimates are due September 15, 2024. Partnership and S-corporations are due September 15th as well. S&A is encouraging all clients that are not waiting for K-1s from a passthrough entity to have their returns completed by August 31, 2024. Next steps, to ensure adequate time to complete your return: As soon as possible, open the email from SafeSend Utilizing SafeSend Organizers : Complete the tax organizer Learn to use SS Organizers: HERE Upload documents electronically – source documents & any IRS Correspondence Documents MUST be in PDF format Links to convert documents and photos to PDF iPhone : LINK Android : LINK Other phone applications : Adobe Scan, Tiny Scanner, CamScanner, Microsoft Lens Once your return is complete: You will receive another email from SafeSend Utilizing SafeSend Returns : Review your return Sign required forms Print required forms Make any online tax payments Step by Step using SafeSend Returns: HERE Pay invoices HERE For more information on the SafeSend Suite and how Stevans & Associates is implementing and using this service, please contact your tax advisor to set up a consultation or call our office at (412)875-5719.

It was a successful January for getting more clients in compliance with 1099 reporting. The key to this is to start early in the year, provide subcontractors with W-9s, obtain social security and employer identification numbers, and keep your accounting up to date. This also helps with workers' compensation insurance audits. More stringent 1099 reporting laws are anticipated in the near future and penalties for non-compliance can be burdensome. It is best to be diligent now and not wait until year end. S&A continues to implement new technologies. Starting in 2023, the Firm implemented SafeSend Organizers and Returns. In 2024 we implemented additional SafeSend products - Signatures, Exchange, and Extensions. The SafeSend suite of products streamlines the data collection and return delivery process for the client and the tax professional. This software also provides high level security for your personal documents and information. S&A is continually looking for ways to implement technologies that will make filing season less taxing for all. S&A is encouraging all clients to utilize this time saving software. Although the client adoption rate has been very high, we are recommending that all clients learn how to use the software before it is the only option. Tax season is stressful for everyone and utilizing this software will help reduce the stress for all and provide a better experience. SafeSend Suite has redefined the way tax and accounting firms handle the entire tax engagement, while providing an easy-to-use interface for the clients. Learn more: SafeSend Returns: 1040s SafeSend Returns: Entities w. K-1 Distribution SafeSend Organizers SafeSend Signatures A second innovative technology S&A implemented this year was Sure Prep Tax Automation software. Sure Prep was purchased by Thomson Reuters this year and was immediately available to be integrated with the TR tax software that we utilize. This software helps reduce data input errors utilizing OCR technology and allows the tax professional to spend more time tax planning and advising and not on data entry . Additionally, this software helps the tax professional organize, notate and bookmark the many documents, as well as provides unique insights on potential missing and unreviewed documents. We believe this software has been a great addition to our technology stack. Although clients may not visualize the benefits provided by this implementation, be assured that S&A is utilizing leading edge technology to provide top of line professional services. "The hardest thing to understand in the world is the income tax." - Albert Einstein A third incredible software implemented this year was the Beta version of Thomson Reuters Checkpoint Edge tax research program utilizing AI. This research technology allows S&A tax professionals to not only provide federal tax research but also multi-jurisdictional research for clients doing business across the country. The program utilizes AI to help the professional to properly word the inquiry to extract the best research results available from the millions of pages of tax code, regulations, revenue rulings/procedures, court cases, and treaties. S&A will provide the best answer for your situation as this software will help us as, "We Listen, We Analyze, We Advise and We Resolve." Our goal with the implementation of these technologies is to provide our preparers with the tools to best accommodate our clients while providing our clients with a seamless tax and accounting experience.

Starting January 1, 2024, a significant number of businesses will be required to comply with the Corporate Transparency Act (“CTA). The CTA was enacted into law as part of the National Defense Act for Fiscal Year 2021. The CTA requires the disclosure of the beneficial ownership information (otherwise known as “BOI”) of certain entities from people who own or control a company. It is anticipated that 32.6 million businesses will be required to comply with this reporting requirement. The intent of the BOI reporting requirement is to help US law enforcement combat money laundering, the financing of terrorism and other illicit activity. The CTA is NOT a part of the tax code. Instead, it is a part of the Bank Secrecy Act, a set of federal laws that require record-keeping and report filing on certain types of financial transactions. Under the CTA, BOI reports will not be filed with the IRS, but with the Financial Crimes Enforcement Network (FinCEN), another agency of the Department of Treasury. Below is some preliminary information for you to consider as you approach the implementation period for this new reporting requirement. This information is meant to be general-only and should not be applied to your specific facts and circumstances without consultation with competent legal counsel and/or other retained professional adviser . What entities are required to comply with the CTA's BOI reporting requirement? Entities organized both in the U.S. and outside the U.S. may be subject to the CTA's reporting requirements. Domestic companies required to report include corporations, limited liability companies (LLCs) or any similar entity created by the filing of a document with a secretary of state or any similar office under the law of a state or Indian tribe. Domestic entities that are not created by the filing of a document with a secretary of state or similar office are not required to report under the CTA. Foreign companies required to report under the CTA include corporations, LLCs or any similar entity that is formed under the law of a foreign country and registered to do business in any state or tribal jurisdiction by filing a document with a secretary of state or any similar office. Are there any exemptions from the filing requirements? There are 23 categories of exemptions. Included in the exemptions list are publicly traded companies, banks and credit unions, securities brokers/dealers, public accounting firms, tax-exempt entities and certain inactive entities, among others. Please note these are not blanket exemptions and many of these entities are already heavily regulated by the government and thus already disclose their BOI to a government authority. In addition, certain “large operating entities” are exempt from filing. To qualify for this exemption, the company must: Employ more than 20 people in the U.S. Have reported gross revenue (or sales) of over $5M on the prior year's tax return; and Be physically present in the U.S. Who is a beneficial owner? Any individual who, directly or indirectly, either: Exercises “substantial control” over a reporting company, or Owns or controls at least 25 percent of the ownership interests of a reporting company An individual has substantial control of a reporting company if they direct, determine or exercise substantial influence over important decisions of the reporting company. This includes any senior officers of the reporting company, regardless of formal title or if they have no ownership interest in the reporting company. The detailed CTA Regulations define the terms "substantial control" and "ownership interest" further. Click the button below for the detailed regulations. When must companies file? There are different filing timeframes depending on when an entity is registered/formed or if there is a change to the beneficial owner's information. New entities (created/registered in 2024) — must file within 90 days New entities (created/registered after 12/31/2024) — must file within 30 days Existing entities (created/registered before 1/1/24) — must file by 1/1/25 Reporting companies that have changes to previously reported information or discover inaccuracies in previously filed reports — must file within 30 days What sort of information is required to be reported? Companies must report the following information: full name of the reporting company, any trade name or doing business as (DBA) name, business address, state or Tribal jurisdiction of formation, and an IRS taxpayer identification number (TIN). Additionally, information on the beneficial owners of the entity and for newly created entities, the company applicants of the entity is required. This information includes — name, birthdate, address, and unique identifying number and issuing jurisdiction from an acceptable identification document (e.g., a driver's license or passport) and an image of such document. Risk of non-compliance Penalties for willfully not complying with the BOI reporting requirement can result in criminal and civil penalties of $500 per day and up to $10,000 with up to two years of jail time. Please get in touch with our office to discuss your business situation. YOU SHOULD CONTACT YOUR ATTORNEY FOR GUIDANCE AND FILING.

Important Note: An extension extends the time to file BUT NOT THE DUE DATE OF YOUR TAX PAYMENT . When an extension is filed without payment you may incur interest and penalties each month until your balance is paid. For this reason, we recommend that you pay as much as possible by the Due Date. The following information can help us estimate Taxes Due with your Extension request: Amounts of Estimated Tax or other Income Tax Payments made in 2023. Any significant changes in income this year. Any other items that may affect your 2023 Tax Liability. EXTENSION FAQS: Who qualifies to file for a tax extension? EVERYONE that needs to file a tax return. When do you need to file for a tax extension? Before April 15th (the 2023 original filing deadline). What form do you use to file for a tax extension? IRS Form 4868 and PA form REV-276. If you have a filing requirement in other states, other state forms may apply as well. Does this extend the time I have to pay my taxes? NO, taxes are due on April 15th. What if I don’t pay the full amount due with my extension? IRS Penalties accrue at 0.5% of unpaid tax each month, not to exceed 25% of unpaid tax. Interest accrues at the current IRS rate of 7% per year. When is the Extended Tax Return Due Date? Six months after the original due date, typically October 15th. Why would I want to file a tax extension? To provide more time to receive and assemble tax documents. Is more cost effective than amending a return with inaccurate information. To allow for sufficient analysis and tax saving advice based on current IRS interpretation and guidance, revised tax forms and software updates. Does an extension increase my chance of being audited? No, the IRS selects returns to audit based on unreported items and variations from the ordinary income and deduction statistics.