accounting, audit, business advisory and tax services
The Protecting Americans from Tax Hikes Act of 2015 (the PATH Act) extended 50% bonus depreciation through 2017. So the PATH Act may give you a tax-saving opportunity for 2015 you wouldn’t otherwise have had. Many businesses will benefit from claiming this break on their 2015 returns. But you might save more tax in the long run if you forgo it.
2016 is the last year that U.S. businesses will receive automatic filing extensions for informational returns on Forms W-2.
IRS regulations, effective July 1, 2016, will remove the automatic extension granted to businesses filing information returns on forms in the W-2 series (with the exception of form W-2G).
Businesses will be able to apply for a single 30-day extension for W-2 form filing, though the IRS expects to grant this extension only in limited cases that exhibit extension need due to “extraordinary circumstances or catastrophe.”
According to the IRS these final, temporary regulations are designed to expedite the filing of forms in the W-2 series to aid in the IRS’ efforts to detect identity theft and refund fraud.
The IRS states that forms in the W-2 series are a major source of false income and withholding among identity thieves. By having these information returns on file sooner, the IRS expects to identify more incidences of identity theft and tax refund fraud.
Paper information returns for Forms in the W-2 series generally must be filed by Feb. 28, or the last day of February of the calendar year following the calendar year for which the information is reported. Electronic information returns for Forms in the W-2 series are generally due by March 31, or the last day of March of the calendar year following the calendar year for which the information is reported.
The IRS indicates that it also intends to eventually remove the automatic 30-day extension of time to file additional forms, including: W-2G, 1042-S, 1094-C, 1095-B, 1095-C, 1097 series, 1098 series, 1099 series, 3921, 3922, 5489 series and 8027.
If you have questions about filing informational returns on Forms in the W-2 series, please contact your Whalen & Company representative.
More Information
By purchasing stock in certain small businesses, you can not only diversify your portfolio but also enjoy preferential tax treatment. And under a provision of the tax extenders act signed into law this past December (the PATH Act), such stock is now even more attractive from a tax perspective.
100% Exclusion from Gain
The PATH Act makes permanent the exclusion of 100% of the gain on the sale or exchange of qualified small business (QSB) stock acquired and held for more than five years. The 100% exclusion is available for QSB stock acquired after September 27, 2010. (Smaller exclusions are available for QSB stock acquired earlier.)
The act also permanently extends the rule that eliminates QSB stock gain as a preference item for alternative minimum tax (AMT) purposes.
What Stock Qualifies?
A QSB is generally a domestic C corporation that has gross assets of no more than $50 million at any time (including when the stock is issued) and uses at least 80% of its assets in an active trade or business.
Many Factors to Consider
Of course tax consequences are only one of the many factors that should be considered before making an investment. Also, keep in mind that the tax benefits discussed here are subject to additional requirements and limits. Consult Whalen & Company for more details.
Copyright 2016 Thomson Reuters
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Here are two extended credits that can save businesses taxes on their 2015 returns.
WORTHINGTON, Ohio (Jan. 7, 2016) — Whalen & Company, CPAs is enhancing its service offerings in 2016, merging with QuickBooks® consulting firm, Simplibooks, and launching a new tax preparation practice, Simplitax. These developments follow Whalen & Company’s acquisition of accounting firm Earman & Wood CPAs in November 2015.
“This is an exciting time for our firm,” said Whalen & Company Partner Lisa Shuneson, CPA, PFS. “As we enter our seventy-first year in business as an accounting firm, Simplibooks and Simplitax will help us continue to evolve with the industry, meet the needs of our clients and engage new clients.”
Previously based in Hilliard, Ohio, Simplibooks will continue to provide QuickBooks® support and bookkeeping services as a division of Whalen & Company. Simplibooks founder Jessica A. Distel, CPA, MBA, a Quickbooks® ProAdvisor, will join Whalen & Company as a Senior Manager, along with associates Tiffany Clark as Client Service Leader and Josh McReynolds as Accounting Staff.
This alliance coincides with a new business venture for Whalen & Company: the launch of Simplitax, a tax preparation business. Simplitax will provide individual income tax preparation as a separate entity operating within Whalen & Company’s parent offices during the 2016 tax year, with plans to expand in 2017.
“Simplitax will provide basic income tax return preparation for individuals, allowing us to connect with new clients who may not have required the full slate of offerings at Whalen & Company,” said Whalen & Company Partner Richard Crabtree, CPA, PFS.
“We are excited about serving new clients with Simplitax’s competitive rates and convenient services,” said Crabtree.
For more information about Simplibooks and Simplitax, visit www.simplibooks.com and www.simplitaxusa.com.
About Whalen & Company, CPAs: Whalen & Company is a full service CPA firm located in Worthington, Ohio. Established in 1945, Whalen & Company offers accounting, audit, business advisory and tax services. www.whalencpa.com
