In the spotlight this month we have Samuel & Jasmine Ward, owners of Ward Computer Services.

WARD Computer Services Inc. is a technology firm dedicated to providing businesses and organizations with quality technical service. WCS specializes in Network Security, Managed IT Support and Computer Repair for businesses and organizations, and quality Geographic Information Systems (GIS) support for various industry sectors.

You can contact WCS at:
700 River Ave
Suite 312
Pittsburgh, PA 15212
(Riverside Center for Innovation)

Toll Free: 1.866.712.9023

Visit their website http://www.WardComputerServices.com/

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• 3 Favorite Foods - Indian, Thai, Greek
• Top 3 Movies - Indiana Jones, Under the Tuscan Sun, Julie and Julia
• 3 Pet Peeves - Negativity, drivers who honk at stoplights, long lines
• 3 Favorite Characters From History / People You’d Like To Meet – Abraham Lincoln, Amelia Earhart, Napoleon Hill
• Pick 1: Blue, Yellow, Red or Green - Red
• Night Owl or Early Bird - Early Bird
• Best Vacation - The Ozarks (Branson, Missouri)
• Dream Vacation - A culinary tour of Southern Italy
• Scariest thing you’ve ever done - I attempted to climb on a statue of a lion in Naples, Italy for a photo opportunity. This is when I realized my fear of heights!
• Favorite season - Fall
• Email, Texting, or Phone Calls - Email
• Favorite job task - Creating maps and running geospatial analysis
• Leasst favorite job task - Reorganizing my office geodatabase

• 3 Favorite Foods - Fried Chicken, General TSO Chicken, and Bacon
• Top 3 Movies - Love & Basketball, Kong Fu Panda, & Clash of the Titans
• 3 Pet Peeves - I only have one pet peeve and that is too many screens up on the computer.
• 3 Favorite Characters From History / People You’d Like To Meet – Jesus, Martin Luther King Jr., and Abraham Lincoln
• Pick 1: Blue, Yellow, Red or Green - Red
• Night Owl or Early Bird - Night Owl
• Best Vacation - Dallas, TX
• Dream Vacation - To take a trip around the World and experience different cuisines
• Scariest thing you’ve ever done - Mountain Climbing
• Favorite season - Autumn
• Email, Texting, or Phone Calls - Email
• Favorite job task - Finding a solution to computer problems that other people cannot fix.
• Leasst favorite job task - Marketing

Do you have an employee who you would like to see further their education? It may not be as tough as you think to help them meet that goal.

Employers may give up to $5,250 on a tax-free basis to an employee for educational assistance. This includes education assistance that is employer provided for graduate-level courses, like programs normally pursued by an individual seeking an education leading to a law, business, medical, or other advanced academic or professional degree.

A written plan must provide guidelines for the assistance, which must be publicized to all of your employees, and must meet a number of conditions. These include nondiscrimination requirements, meaning it cannot benefit highly compensated employees.

Any amount of the employee’s income used as education assistance may not be taken as a deduction or credit by the employee.

For more information, contact our office at 412-816-2228.

Did you know that your summer day care expenses may qualify for an income tax credit? Many parents who work, or are looking for work, must arrange for care of their children under 13 years of age during the school vacation. Those expenses may help you get a credit on next year’s tax return.

Here are five facts the IRS wants you to know about a tax credit available for child care expenses. The Child and Dependent Care Credit is available for expenses incurred during the lazy hazy days of summer and throughout the rest of the year.

1. The cost of day camp may count as an expense towards the child and dependent care credit.


2. Expenses for overnight camps don’t qualify.


3. If your childcare provider is a sitter at your home or a daycare facility outside the home, you’ll get some tax benefit if you qualify for the credit.


4. The actual credit can be up to 35 percent of your qualifying expenses, depending upon your income.


5. You may use up to $3,000 of the unreimbursed expenses paid in a year for one qualifying individual or $6,000 for two or more qualifying individuals to figure the credit.

For more information on Child and Dependent Care Expenses, give us a call at 412-816-2228.

Q. Who must pay the indoor tanning services tax?

A. Indoor tanning service providers are responsible for collecting the tax from the person paying for the service and in some situations, from the person receiving the service.

Q. If the tax isn’t collected from the person paying for the service, or for an undesignated payment from the person redeeming the gift card, then who is liable for the tax?

A. The person receiving the payment for the indoor tanning service (usually, the provider of the service) is liable.

Q. Who must report the tax to the government?

A. The person receiving the payment for the indoor tanning service must report the indoor tanning services tax.

Q. How do I report and pay the tax due the indoor tanning services tax?

A. Report and remit the full amount of the indoor tanning services tax on a timely-filed Form 720, Quarterly Federal Excise Tax Return. Excise tax deposits are not required for the tax on indoor tanning services.

Q. If an invoice includes other goods and services in addition to indoor tanning services, how are the non-tanning services handled?

A. The service provider doesn’t calculate tax on non-tanning services, as long as the fair market value of all goods and services are listed separately on the invoice.

Q. How do I handle a transaction (such as the sale of a gift certificate) when I can’t determine at the time of sale what, if any, portion of the gift certificate will be redeemed for an indoor tanning service?

A. Payments (such as the sale of a gift certificate) received in exchange for unspecified services aren’t subject to tax at the time of payment. When the holder of the gift certificate exchanges the gift certificate for indoor tanning services, the provider will determine and collect any tax due on the indoor tanning services.

Q. If a customer redeems a gift card but doesn’t use it for indoor tanning services, is the indoor tanning tax applicable?

A. No, the tax does not apply in this situation.

Q. If a customer purchases a gift card for indoor tanning services, pays the tax and doesn’t use the card, is the purchaser entitled to a refund of tax?

A. No, there is no provision for refunding the tax once the service for indoor tanning services is purchased.

Q. What are the requirements for keeping records for indoor tanning services?

A. As with any other tax return, the tanning service provider must maintain adequate books and records showing the amount of revenue received for indoor tanning services.

In the spotlight this month we have Larry George (2nd from left), owner of LG3 Entertainment, LLC.

“LG3 Entertainment, LLC. provides family fun entertainment through Disc Jockey Services specializing in weddings, parties, school events and social gatherings. Our stunning photography captures great engagement pictures, senior portraits or family pictures as well as headshots. We also offer chair covers, custom made wedding favors, save the date magnets, elegant UP-Lighting and customized gift card boxes. We are your one stop shop for all of your entertaining needs.”

You can contact LG3 at:
1613 Brinton Ave
North Braddock, PA 15104
(412-818-8523)

LG3@LG3Entertainment.com

Visit their website http://www.lg3entertainment.com/

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Larry

• 3 Favorite Foods - Beef Stroganoff, Hamburger Helper and my Italian Grandmothers homemade Spaghetti and Meatballs.
• Top 3 Movies - A Christmas Story, The Goonies, and any Short Circuit movies
• 3 Pet Peeves - Slow Drivers, Non Turn Signal Usage while driving and people who don’t read and then ask you a question when the answer was clearly stated in what they were just reading.
• 3 Favorite Characters From History / People You’d Like To Meet – Walt Disney, Old Blue Eyes (Frank Sinatra) and Carrie Underwood
• Pick 1: Blue, Yellow, Red or Green - Blue
• Night Owl or Early Bird - Ha! Ask my accountants that question. Can we say 3am emails?
• Best Vacation - Anything Disney related. He’s my idol.
• Dream Vacation - Taking 1 month and traveling to Paris, Hawaii, Spain and Turkey.
• Scariest thing you’ve ever done - Road the sky coaster at Kennywood.
• Favorite season - Fall. The weather, the leaves changing and football!
• Email, Texting, or Phone Calls - Email, by far! It’s the only form of communication when you’re working at 3am!
• Favorite Halloween costume you’ve worn - Alfalfa
• Favorite job task - Making a trip to the bank to cash checks or make a deposit.
• Leasst favorite job task - Steaming hundreds of chair covers a week.

August 2:

• Employers. File Form 941 for 2nd quarter 2010.


• Employers. Form 5500 or 5500-EZ for calendar year 2009 due if you maintain an employee benefit plan, or file Form 5558 to request an extension.

September 15:

• Individuals. 3rd installment of 2010 estimated tax due.


• Calendar-year C Corporations.3rd installment of 2010 estimated tax due.


• Corporations. 2009 returns due for calendar-year C and S corporations (Form 1120 &1120S) if on extension.


• Partnerships. Calendar year 2009 return due (Form 1065) if on extension.

You filed your tax return and you’re expecting a refund. You have just one question and you want the answer now – Where’s My Refund? If you file a paper return it will take six to eight weeks after the IRS receives your return. File electronically and you’ll get the refund in half that time. Using direct deposit speeds things up significantly. If you filed a paper return you completed without tax preparation software, you’re chances of making an error increase substantially and that could delay your refund.

You can check on the status of your refund at IRS.gov via the “Where’s My Refund?” link. Refund information for the most current tax year that you filed will generally be available 72 hours after the acknowledged receipt of your e-filed return, or three to four weeks after mailing a paper return.

To get to your personal refund information, be ready to enter your:

• Social Security Number (or IRS Individual Taxpayer Identification Number)


• Filing status


• Exact refund amount shown on your return

Although business is business, and pleasure is pleasure, the world rarely adheres to absolutes. So, as the summer vacation season begins to unfold, you may want to consider mixing some leisure time in with your business travel. With a little planning, you can get Uncle Sam to subsidize your downtime.

Business or Pleasure. The IRS doesn’t specify the determination of whether a trip is for business or pleasure on domestic trips. However, looking to the rules on international travel for guidance, the number of days spent on each type of activity is the key. An important factor in determining if the trip is primarily business or pleasure is the amount of time spent on each, although this isn’t the sole factor. In general, the trip is “primarily for business” if more than half of the days are spent on business activities.

The following days count toward your total business days:

• Travel days;


• Weekends and holidays, if they fall between days devoted to business and it would be impractical to return home;


• “Standby days”, when your physical presence is required, also count as business days – even if you’re not called upon to work on those days;


• Any other day principally devoted to business activities during normal business hours; and


• Days you intended to work but couldn’t due to reasons beyond your control (local transportation difficulties, power failures, etc.).

If the trip doesn’t involve the actual conduct of business but is for the purpose of attending a convention, seminar, etc., IRS checks the nature of the meetings carefully to make sure they are not vacations in disguise. Be careful to save all material helpful in establishing the business nature of this travel. Meticulous recordkeeping and thorough planning are necessary.

Transportation Costs. The cost of traveling within the United States is 100% deductible as long as the primary purpose for the trip is business rather than pleasure. In contrast, no travel deductions are allowed if the main reason for a trip is personal.

Meals and Lodging. Once at your destination, expenses for such items as lodging, hotel tips, local cab fares, and 50% of meals are deductible when related to business days. However, these same types of expenses aren’t deductible for non-business days. Additionally, no deduction will be allowed for meals or lodging to the extent the expense is “lavish or extravagant”. Although this term isn’t defined in the tax rules, it has been interpreted to mean “unreasonable”.

Personal entertainment costs on the trip aren’t deductible (such as a sightseeing tour), regardless of the day on which they fall. But business-related costs such as dry-cleaning, phone calls, and computer rentals are.

Taking Your Spouse. The rules on deducting the costs for a spouse accompanying you on a business trip are very restrictive. No deduction is allowed unless your spouse is an employee of yours or your company and his or her travel is also for a business purpose. This means you can’t deduct the travel costs of a spouse, even if his or her presence has a bona fide business purpose, unless your spouse is a bona fide employee of your business.

If your spouse is your employee, and if his or her presence on the trip serves a bona fide business purpose, then you can deduct his or her travel costs. Merely having your spouse perform some incidental business service – such as typing up notes from a meeting – isn’t enough to establish a business purpose. In general, it isn’t sufficient for your spouse’s presence to be “helpful” to your business pursuits – it must be “necessary”.

If your spouse’s travel is not deductible, you can still deduct your own travel and meals; however, a shared cost – as with lodging – is deductible only at the single rate.

Not sure whether your travel expenses will be deductible? Take a few minutes to give our office a call, at 412-816-2228.

In the spotlight this month we have Jonathan Mussari, owner of Artistic Landscape Creations

“Vacation everyday! Step out your back door.”

The business is located at 4016 Crestwood Drive, Gibsonia, PA, 15044 – (412-303-4443)
Visit their website www.artisticlc.com/

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• 3 Favorite Foods - Pizza, Lobster, Steak
• Top 3 Movies - Christmas Vacation, The Game, Tommy Boy
• 3 Pet Peeves - Drivers that drive 5 mph below the speed limit and then
  blow the next stop sign; People that look for hand outs; Customers
  who call today and expect me to start tomorrow.
• Favorite Character From History / Person You’d Like To Meet – Mario
• Pick 1: Blue, Yellow, Red or Green - Blue
• Night Owl or Early Bird - Night Owl
• Best Vacation - Mexico
• Dream Vacation - Anywhere by the beach, for a month
• Scariest thing you’ve ever done - Opened a business
• Favorite season - Winter
• Email, Texting, or Phone Calls - Email
• Favorite Halloween costume you’ve worn - A business owner
• Favorite job task - Designing and then creating what is on the paper; Cutting down big trees
• Leasst favorite job task - Chasing money

Small businesses and their workers have good reason to pay attention to some of the key provisions in the recently-enacted health reform legislation. Whether a business will be affected by them depends on a variety of factors, such as the number of employees the business has. Below is an overview of the provisions in the new law that will have the biggest impact on small business. If you would like more details about these provisions or any other aspect of the new law, please do not hesitate to call our office at 412-816-2228.

Tax Credits. The new law provides small employers with a tax credit (i.e., a dollar-for-dollar reduction in tax) for nonelective contributions to purchase health insurance for their employees.

Eligibility. To qualify, a business must offer health insurance to its employees as part of their compensation and contribute at least half the total premium cost. The business must have no more than 25 full-time equivalent employees (“FTEs”), and the employees must have annual full-time equivalent wages that average no more than $50,000. However, the full amount of the credit is available only to an employer with 10 or fewer FTEs and whose employees have average annual full-time equivalent wages from the employer of less than $25,000.

Years Available. The initial credit is available for tax years beginning in 2010 through 2013. Health insurance coverage purchased from an insurance company licensed under state law will qualify for this first phase. After 2013, the credit is only available on coverage purchased through a state exchange and is only available for two years.

Amount of Credit. For tax years beginning in 2010 through 2013, the credit is generally 35% of the employer’s nonelective contributions toward the employees’ health insurance premiums. The credit is 50% for tax years beginning after 2013. The credit phases out as firm size and average wages increase.

Special Rules. The employer must reduce the deduction for the amount it pays in health insurance by the dollar amount of the credit. For example, if an eligible small employer pays 100% of the cost of its employees’ health insurance and the amount of the tax credit is 35% of that cost, the employer can claim a deduction for the other 65% of the premium cost.

Exclusions. Self-employed individuals – including partners and sole proprietors, 2% shareholders of an S corporation, and five percent owners of the employer – are not eligible for the credit. There is also a special rule to prevent sole proprietorships from receiving the credit for the owner and their family members.

Penalty Exemption. Employers with fewer than 50 employees aren’t subject to the “pay or play” penalty for not providing coverage to their employees. For businesses with at least 50 employees, the possible penalties vary depending on whether or not the employer offers health insurance to its employees. These provisions take effect Jan. 1, 2014.

I recently needed to buy new appliances, and as part of a diligent search, compared several brands and their features. Though I was soon overwhelmed by the data I collected, I sorted out a list of brands and model numbers that met my needs. Thinking that my task was nearly complete, I proudly moved on to pricing and sourcing the items.

I began with the internet, as this is where I had done all of my research, and kept in mind that price would not be the only decision maker. After shipping, online prices were on par with those at the big box stores. Shopping at the box stores, however, led me to salesmen with knowledge levels that were patchy at best, and when asked about service, the answer was always “service is offered through the manufacturer.”

Department store staffs were more knowledgeable and the store provided service, both pluses, but brand selections were limited and though knowledgeable, salespeople would make claims that I knew not to be true to try and make a sale. I appreciated their loyalty to the store and its brands, but they allowed for little flexibility. They would all tell stories of happy customers while at the same time internet review sites had lists of repair problems. Also, as with the box stores, they wanted to deliver the appliances immediately, something for which I was not ready.

Doing further research revealed a consumer report that many people were happiest when they shopped at a small, locally-owned appliance dealer. The good news was that I had one near me! I walked in and met Steve, showed him my list, and began to discuss the pros and cons. He mentioned that taking one feature out of my refrigerator – a door ice dispenser – would likely reduce future problems. Steve could have the appliances delivered anytime I wanted (turned out to be six months later) and said that his store would be the only number to call if I had any problems with any of the five brands I had selected. This was important because I was buying eight appliances; I knew I would have a problem sooner or later.

Steve then took me to the appliances he had in his small showroom. He could only show me a few examples, but this mattered little because I had seen all of them in my previous searches. When he showed me the oven I wanted, he had to apologize because the door was missing. He explained to me that a customer had recently installed one and found the controls were faulty. The replacement was going to take two weeks, so Steve had removed the door from the show room model to keep the customer operating. It was then that knew I had my supplier.

Since then, the appliances were delivered on time and Steve has twice made arrangements for a manufacturer repair. I made one call, he made many. I can only imagine the number of calls I would have had to make if I had used another supplier.

This is what small business does best, and when it does it well, it easily exceeds any other competitor. A small business may not have the advertising budget and may not offer the gift cards and fancy showrooms, but making their customer happy is their focus because happy customers keep them in business. Long may they thrive!

On June 24th, from 8am to 1 pm, bring any old papers that need shredded to Penn Hills.

Raffle gifts and Food!

We’ll do it for free!

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Sponsored by the Goldmine Network Group and Iron Mountain.

In the spotlight this month we have Dr. Eric Garver, owner of Garver Dental Health.

Since 1928 Garver Dental Health has been caring for the Oral Health needs of North Pittsburgh. With a unique combination of technology and third generation expertise, Dr. Eric Garver practices a unique style of Oral Health Care that drastically reduces time in the dental chair and assures clinically superior results.

The office is located at 8135 Perry Highway, Pittsburgh PA, 15237 (in the North Hills). You can contact them at 412-364-4434, or garverdentalhealth@verizon.net

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This has been a lot of fun. Thank you for the opportunity and thank you for being such fantastic friends!

It is becoming common to experience debt relief in these challenging times. Debt relief is usually taxable if not relieved through bankruptcy proceedings. However, canceled debt is not included in income to the extent that you are insolvent immediately before the cancellation. You are insolvent if all of your liabilities exceed the fair market value of all of your assets.

Because of the difficulty in determining insolvency, the IRS has developed a comprehensive insolvency worksheet. It can be found in the newly revised edition of Publica-tion 4681, Canceled Debts, Foreclosures, Repossessions, and Abandonments (for Individuals). The result can then be used to determine whether and to what extent your canceled debts are excluded from gross income.

Recently signed into law, the “Hiring Incentives to Restore Employment Act of 2010” (the HIRE Act), includes several provisions of extreme importance to many businesses. If you would like more details about these provisions or any other aspect of the new law, please do not hesitate to contact our office at 412-816-2228.

Payroll tax holiday and up-to-$1,000 credit for employers who hire unemployed workers. To help stimulate the hiring of workers by the private sector, the new law exempts any private-sector employer that hires a worker who had been unemployed for at least 60 days from having to pay the employer’s 6.2% share of the Social Security payroll tax on that employee for the remainder of 2010. As an additional incentive, the employer is eligible for an additional non-refundable tax credit of up to $1,000 for any qualifying worker hired under this initiative that is kept on payroll for a continuous 52 weeks. In order to be eligible, the employee’s pay in the second 26-week period must be at least 80% of the pay in the first 26-week period.

Workers hired after Feb. 3, 2010 are eligible for the payroll tax forgiveness and the retention bonus, but only wages paid after March 18 receive the exemption for payroll taxes. Restrictions do apply, so check the law carefully. For example: these tax breaks do not apply to hiring family members.

Extension of enhanced small business expensing. The new law gives a one-year extension on enhanced expensing rules, which allow qualifying businesses the option to currently deduct the cost of business machinery and equipment, instead of recovering it via depreciation over a number of years. For tax years beginning in 2010, the maximum amount that a business may expense is $250,000, and the expensing election begins to phase out when a business buys more than $800,000 of expensing-eligible assets. These dollar limits are the same as those that were in effect for 2008 and 2009.

The Patient Protection and Affordable Care Act and Health Care and Education Reconciliation Act of 2010 phases in tax changes over a span of eight years and contains key provisions of importance to both individual and business taxpayers. Below is an expected timeline for when certain tax-related provisions will become effective. Please call our offices (412-816-2228) for details of how the new changes may affect your specific situation.

2010

• 10 percent excise tax on indoor tanning services begins July 1.


• Adoptions tax credit is made refundable, effective Jan. 1, 2010; the thresholds for qualifying expenses are increased; and the adoption credit is extended through 2011.


• Forgiven student debts for certain medical professionals are excluded from taxable income beginning in the 2009 tax year.

2011

• Businesses must begin reporting the value of health care benefits on employees’ W-2 statements.


• Money in flexible spending arrangements, health savings accounts, and other health reimbursement arrangements cannot be used for over-the-counter medicines unless they are prescribed by a doctor.


• The penalty for using health savings account funds for nonqualified uses will rise to 20 percent from 10 percent.

2012

• New information reporting is required for businesses making payments in excess of $600 over the course of a calendar year to corporations.

2013

• A new 0.9 percent surtax will be added to the 1.45 percent Hospital Insurance payroll taxes paid by individuals earning more than $200,000 per year or joint filers earning more than $250,000 per year.


• A 3.8 percent tax will be imposed on unearned income of individuals earning more than $200,000 per year ($250,000 for joint filers).


• The threshold for claiming medical expense deductions rises from 7.5 percent of adjusted gross income to 10 percent, but will remain at 7.5 percent of income for individuals 65 or older until 2016.


• Contributions to health care flexible spending arrangement will be limited to $2,500 as of Jan. 1, 2013.

If you purchase an extended warranty for an auto used for business purposes, the cost must be deducted over the life of the warranty. Take the full cost and divide by the number of months in the warranty period. Multiply the number of months the warranty was in effect for the year by the monthly amount.

For example: You purchase a 2-year extended warranty on September 1. In the first year, you can only deduct 4 months of the total cost of the warranty. In year 2, 12 months of the cost can be deducted. If the auto isn’t used 100% for business, you can only deduct the portion that applies to the business.

In the spotlight this month we have Joe & Missy Tambellini, owners of Joseph Tambellini Restaurant

Tambellini’s provides upscale, fine dining with a light hearted, comfortable atmosphere and down to earth fresh food.

The Restaurant is located at 5701 Bryant Street, Pittsburgh, PA – 412-665-9000. Visit their website http://josephtambellini.com

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• 3 Favorite Foods -Peanut Butter, Chocolate, Spaghetti
• Top 3 Movies -Christmas Vacation, Pee Wee’s Big Adventure, A Beautiful Mind
• 3 Pet Peeves -People that “know everything”, Drivers that don’t thank you when you let them out, Whistling
• 3 Favorite Characters From History / People You’d Like To Meet – Benjamin Franklin, Cleopatra, Bono
• Pick 1: Blue, Yellow, Red or Green -Green
• Night Owl or Early Bird -Early Bird
• Best Vacation - Puerto Rico
• Dream Vacation - Tahiti
• Scariest thing you’ve ever done -Opened a restaurant
• Favorite season -Summer
• Email, Texting, or Phone Calls -Email
• Favorite Halloween costume you’ve worn -Fairy princess in 3rd grade
• Favorite job task -Getting to know our customers
• Leasst favorite job task - Dealing with numbers

• 3 Favorite Foods -Hamburgers (aka American Fillet), Sushi, My meatballs
• Top 3 Movies -Pulp Fiction, Goodfellas, American Gangster
• 3 Pet Peeves -Unmotivated people, Vegans, Peaple that don’t accept/admit that they are wrong
• 3 Favorite Characters From History / People You’d Like To Meet – Fred Bear, David Gilmore, Hitler
• Pick 1: Blue, Yellow, Red or Green - Green
• Night Owl or Early Bird - Night Owl
• Best Vacation - Hawaii
• Dream Vacation - To see my family’s town in Tuscany, Italy
• Scariest thing you’ve ever done -Helicopter ride in Kauai
• Favorite season -Fall
• Email, Texting, or Phone Calls - Phone Calls
• Favorite Halloween costume you’ve worn - Army Guy
• Favorite job task -Talking with customers
• Leasst favorite job task - Taking inventory

April 15:

• Individuals: 2009 Form 1040 due, or file Form 4868 for automatic 6-month extension. Last day to contribute to an IRA and ESA for 2009. First installment of 2010 estimated tax due. 2009 Form 709, US Gift Tax Return, due if more than $13,000 was gifted to any individual other than a spouse or charity in 2010.


• Partnerships: 2009 Form 1065 due, or file Form 7004 for automatic 5-month extension.


• Calendar-Year C Corporations: First installment of 2010 estimated tax due.

April 30:

• Employers: File Form 941 for 1st quarter 2010.

May 17:

• Partnerships & S Corporations: Form 8752 due for those using a fiscal year under a Section 444 election.

June 15:

• Individuals: Second installment of 2010 estimated tax due for individuals. 2009 Form 1040 due for U.S. citizens or resident aliens living and working (or on active military duty) outside the U.S. and Puerto Rico, or file Form 4868 for 6-month extension.


• Calendar-Year C Corporations: Second installment of 2010 estimated tax due.

The IRS recently developed the “Did I Receive an Economic Recovery Payment?” look-up tool which gives taxpayers an easy way to determine if they received the one-time ERP payment and which agency made the payment. Beginning March 8, 2010, taxpayers can call 866-234-2942 to access the phone application. The Web application will be available in late March on IRS.gov.

Taxpayers must report whether or not they received an ERP and the amount when they prepare their Schedule M, Making Work Pay and Government Retiree Credits.

The one time $250 ERP was paid to individuals in the following categories:

• Retirees, disabled individuals and Supplemental Security Income (SSI) recipients receiving benefits from the Social Security Administration,


• Disabled veterans receiving benefits from the U.S. Department of Veterans Affairs, and


• Railroad Retirement beneficiaries.

Using the IRS look-up tool taxpayers will have to enter three pieces of information to determine if they received an ERP:

• SSN


• Date of birth


• Zip code from the last filed return

A separate telephone call or Web inquiry must be made for each taxpayer, even if filing a joint tax return.

Annual depreciation limits apply to autos and trucks, but some special vehicles are exempt such as qualified non-personal use vehicles, which by their nature are not likely to be used more than a minimal amount for personal purposes.

If your truck or van has been specially modified in ways that limit personal use – by the installation of permanent shelving, for example – annual limits will not apply. Delivery trucks with seating only for the driver, or only for the driver plus a folding jump seat are also qualified non-personal use vehicles.

If you’re a sole proprietor, S corporation and partnership for tax filing purposes, you may be able to deduct your health insurance premiums on the front of Form 1040. The benefit is that you lower your adjusted gross income, potentially making it easier to qualify for a number of tax benefits that are phased out at higher income levels, and do not lose the deduction if you do not itemize. If you’re a more than 2%-shareholder in an S corporation, the S corporation must pay the premiums directly or reimburse you for the premiums, and the premiums must be reported as income on your W-2.

Regardless of the type of business, if you were also eligible to participate in any subsidized health plan for any month or part of a month, amounts paid for health coverage for that month don’t qualify. For example: your spouse worked for XYZ Inc. for the first six months of 2009 and was eligible to participate in the company’s family plan by paying a reduced $60 per month. You were self-employed for the whole year and paid $12,000 for a policy to cover the both of you for the entire year. Only payments during the last six months of 2009 qualify.

You don’t have to form a corporation, partnership or other entity to own a rental property with a friend, relative, or business associate. You can own the property as tenants-in-common. And interests don’t have to be on a 50-50 (or other amount based on solely on the number of tenants) basis.

For example, Sandy can put up 70% of the capital and Jack 30%. If that’s the case, Sandy is entitled to 70% of the income and is responsible for 70% of the expenses. And that’s how each should report the income and expenses on their respective tax returns. If Sandy doesn’t pay her full 70% share of the expenses, the additional amount paid by Jack is considered a loan to Sandy. Jack can’t deduct the amount he paid for Sandy. Talk to your attorney about the best way to handle the agreement. In most cases the split should be spelled out in the deed. You may want to have a side agreement as to the responsibilities of each tenant.

For owners of small businesses and their workers, the recently enacted health reform legislation has some key provisions to pay attention to. The major ones include: tax credits; excise taxes; and penalties. But whether a business will be affected by them depends on a variety of factors, such as the number of employees the business has.

The following 3 articles will give you an overview of the provisions in the new law with the biggest impact on small business. Please call our offices at 412-816-2228 for details of how the new changes may affect your specific business.

Tax credits to certain small business employers that provide insurance

Most small businesses exempted from penalties for not offering coverage to their employees

The “Cadillac tax” on high-cost health plans

The new law provides small business employers with a tax credit (i.e., a dollar-for-dollar reduction in tax) for nonelective contributions to purchase health insurance for their employees. The credit can offset an employer’s regular tax or its alternative minimum tax (AMT) liability.

Small business employers eligible for the credit. To qualify, a business must offer health insurance to its employees as part of their compensation and contribute at least half the total premium cost. The business must have no more than 25 full-time equivalent employees (“FTEs”), and the employees must have annual full-time equivalent wages that average no more than $50,000. However, the full amount of the credit is available only to an employer with 10 or fewer FTEs and whose employees have average annual full-time equivalent wages from the employer of less than $25,000.

Years the credit is available. The credit is initially available for any tax year beginning in 2010, 2011, 2012, or 2013. Qualifying health insurance for claiming the credit for this first phase of the credit is health insurance coverage purchased from an insurance company licensed under state law. For tax years beginning after 2013, the credit is only available to an eligible small business employer that purchases health insurance coverage for its employees through a state exchange and is only available for two years. The maximum two-year coverage period does not take into account any tax years beginning in years before 2014. Thus, an eligible small business employer could potentially qualify for this credit for six tax years, four years under the first phase and two years under the second phase.

Calculating the amount of the credit. For tax years beginning in 2010, 2011, 2012, or 2013, the credit is generally 35% (50% for tax years beginning after 2013) of the employer’s nonelective contributions toward the employees’ health insurance premiums. The credit phases out as firm-size and average wages increase. Tax-exempt small businesses meeting these requirements are eligible for payroll tax credits of up to 25% for tax years beginning in 2010, 2011, 2012, or 2013 (35% in tax years beginning after 2013) of the employer’s nonelective contributions toward the employees’ health insurance premiums.

Special rules. The employer is entitled to an ordinary and necessary business expense deduction equal to the amount of the employer contribution minus the dollar amount of the credit. For example, if an eligible small business employer pays 100% of the cost of its employees’ health insurance coverage and the amount of the tax credit is 50% of that cost (i.e., in tax years beginning after 2013), the employer can claim a deduction for the other 50% of the premium cost.

Self-employed individuals, including partners and sole proprietors, two percent shareholders of an S corporation, and five percent owners of the employer are not treated as employees for purposes of this credit. Any employee with respect to a self-employed individual is not an employee of the employer for purposes of this credit if the employee is not performing services in the trade or business of the employer. Thus, the credit is not available for a domestic employee of a sole proprietor of a business. There is also a special rule to prevent sole proprietorships from receiving the credit for the owner and their family members. Thus, no credit is available for any contribution to the purchase of health insurance for these individuals and the individual is not taken into account in determining the number of full-time equivalent employees or average full-time equivalent wages.