Tax Tip: Ohio Sales Tax Holiday

August 5th, 2016

The holiday starts Today, August 5, 2016 and ends on Sunday, August 7, 2016 at midnight.

During the holiday, the following items are exempt from sales and use tax:

  • Clothing priced at $75 per item or less;
  • School supplies priced at $20 per item or less; and
  • School instructional material priced at $20 per item or less.

Items used in a trade or business are not exempt under the sales tax holiday.

Check out the Frequently asked questions for more info.

Tax Tip: Summer day camps qualify for the dependent care credit

July 8th, 2016

If you send your child to any special day camps this summer, such as those for sports, computers, math or theater, don’t forget to take the tax break. The same goes for camps your child is attending this summer that focus on improving reading or study skills. There are other rules for the tax credit that must also be satisfied, the child must be under 13, and expenses must be incurred so the parents can work.

The costs of summer school and tutoring programs aren’t eligible for the credit. Neither are overnight camps.

Tax Tip: IRS Shifting Audit Focus

June 7th, 2016

Individuals who work for themselves will feel less audit heat in coming years, as IRS is shifting away from 1040 field exams of self-employed taxpayers.  It will focus a greater chunk of its limited resources on auditing pass-through firms such as partnerships and S corporations, which have more-complicated tax issues than sole proprietorships. The IRS believes it can get more bang for its buck from these types of audits.

Caution: If you are an S corp and not paying yourself a reasonable salary, you may be flagged for an audit.

Tax Tip: Ohio School District Income Tax Notice Mailing

June 1st, 2016

The Ohio Department of Taxation is mailing notices to taxpayers who didn’t file a school district income tax return for any of the years 2012-2014.

As always, if you receive any notice its from the IRS, state, or city, let us know right away.

Tax Tip: Correcting Misclassified Workers

May 27th, 2016

As we have discussed in previous Tax Tips, the IRS is going after companies that are treating employees as subcontractors.  Companies that have, in the past, consistently treated workers as subcontractors instead of employees and issued them 1099’s can come clean with the IRS.  They will pay a modest fine and receive audit protection for the earlier years. However, the company must agree to treat the workers as employees in the future.

Tax Tip: Labor Department Publishes New Overtime and Exempt Status Rules

May 24th, 2016

The Department of Labor has announced the publication of the final rule updating the overtime regulations.  The rule focuses primarily on updating the salary and compensation levels needed for workers to be exempt.

The changes double the salary threshold for “white collar” exemptions from the current minimum of $455 per week, or $23,660 a year, to $913 per week, or $47,476 annually. Under the new rules, the salary threshold will automatically update every three years, based on wage growth over time. The final rules will become effective on December 1, 2016.

The rule sets the standard salary level at the 40th percentile of earnings of full-time salaried workers in the lowest-wage Census Region, currently the South region. Under the previous regulations, a white collar employee had to be paid at least approximately $23,660 annually to qualify as an exempt employee.

For more information check out these links

https://www.dol.gov/whd/overtime/final2016/general-guidance.pdf

http://webapps.dol.gov/elaws/whd/flsa/screen75.asp

https://www.dol.gov/whd/overtime/final2016/

Tax Tip: Scam IRS Phone calls

May 16th, 2016

Never trust someone who calls you saying they are from the IRS and that you owe them money.  The IRS will never call you to let you know that you owe money.  They will always send a notice in the mail that states the amount that you owe.  Then, you will need to call them.