The IRS Deductions Blog

Archive for January, 2009

Accessing medical insurance today is not as easy as it sounds, but a plan to suit your needs is possible with the right research. First the self-employed needs to decide how much health insurance he or she needs. Then how many other individuals will be on the same insurance plan. Some very helpful tips are:

1. Getting the most out of your insurance plan

2. Researching cheaper ways to self purchase

3. Temporary insurance or permanent insurance

4. Individual insurance plan or group insurance plan

To receive the most out of your insurance plan will take research. Are you looking for a policy with a high monthly premium and Low Deductible? Are you looking for an insurance policy with a low monthly premium and high deductible? What about office visit co-payments, a dental plan, hospitalization, and a prescription drug program? Are you willing to accept more out of pocket expense or is this not feasible at the moment?

Much will depend on your immediate family and those of your employees. Are you all young with school age children? Have you received any health insurance quotes from the insurance companies you sent letters? Something else to consider is the overall lifetime benefits for each individual. Once you have an ideal of what to search for you can try to narrow down the type of plan.

Are you aware that at the end of each fiscal year you may deduct your annual medical premium as long as you personally are a small business and paying out of pocket for the full expense? You will also need to find out if any of the individuals you are planning to add to your small business policy have any pre-conditions that may delay health care in full.

Pre-conditions such as arthritis, heart disease, eye disorders, diabetes, asthma, and a host of other maladies may complicate the issues. Here is a good place to search as we have a very comprehensive report on what is and what is not a pre-condition.

Now you can begin to look into different types of insurance plans that will be beneficial to you and your few employees. Something else to consider is a flexible spending account, but keep in mind this is not for everyone. Other types of small business low cost health insurance will involve the HMO, the PPO, the POS, and the HSA. Each of these plans will offer advantages and disadvantages.

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STOP Buying Health Plans and START Buying Health Insurance!: An Easy-To-Understand Guide to the How and Why of Consumer Directed Healthcare (HSAs, HRAs and Deductible-First Medical Insurance) $9.56 We are all excellent consumers. We collectively have no problem clearly identifying what we want, how we want it and when the price is right. We make our educated presence known in almost every marketplace except one— healthcare. Managed care and its first dollar benefits have created a problem and the solution is consumer directed healthcare. We can fix our system of healthcare and your secon…

Impact of Type of Insurance Plan on Access and Utilization of Health Care Services for Adults Aged 18-64 Years With Private Health Insurance: United States, 2007-2008 $1.99 National attention to consumer-directed health care has increased following the enactment of the Medicare Prescription Drug Improvement and Modernization Act of 2003 (P.L. 108-173), which established tax-advantaged health savings accounts (HSAs) (1). Enrollment in consumer-directed health care products has increased over the past several years (2). Consumer-directed health care may enable individu…

To amend the Internal Revenue Code of 1986 to expand health coverage through the use of high deductible health plans and to encourage the use of health savings accounts. $9.30 The BiblioGov Project is an effort to expand awareness of the public documents and records of the U.S. Government via print publications. In broadening the public understanding of government and its work, an enlightened democracy can grow and prosper. Ranging from historic Congressional Bills to the most recent Budget of the United States Government, the BiblioGov Project spans a wealth of gover…

What are the requirements to be able to contribute to an HSA?

What are the requirements to be able to contribute to an HSA? Health Savings Accounts (HSA) can be used by individuals covered by a high-deductible health plan to save for health care costs on a tax-free basis, in an account that is similar to that of an individual retirement account (IRA) .The HSA provides for a tax-sheltered account that can be used for paying routine medical expenses . In …

Dr. Brent Knight, President of LCC, testifies in support of HB 5345, Nov. 19, 2009

The first time home buyer’s tax credit, which expires November 30, 2009, has been boosting U.S. summer home sales. The question is: can it last? With budget cuts, layoffs and an all-around depressed economy, there are some questions as to whether this jump in home sales will last and, too, whether the people buying homes will be able to keep them.

In July, sales jumped a record 7.2 per cent, with one out of every three home buyers being a first time home owner. 7.2 per cent might not seem like a lot, but when you realize that this equals 350,000 more home buyers in July than in June, it’s clear that something is spurring on real estate consumers. With a third of home sales being to first-time home buyers, it’s clear that the tax credit bears some responsibility for the situation.

Normally improved home sales would be cause for rejoicing. “Sales are up! The economy’s turning around! Yay!” Indeed, we all hope that we will soon see some relief from the recession. However, it would be unwise to use this particular instance as “evidence” of a financial turnaround for the U.S. This brief burst of prosperity may subside once the first-time home buyer’s tax credit expires at the end of November.

Many buyers are taking advantage of the huge dips in prices for homes, hoping to see gains in equity. Foreclosure homes are especially popular, as buyers are getting homes at a fraction of the price, even in traditionally expensive markets like San Diego and Orlando.

The national median sales price is now $178,400, nearly $100,000 below what it was in the early part of the decade. This can offer home buyers an exceptional value, but means nothing if the home owners are unable to hold onto their assets.

Job losses are threatening the ordinary home owner even as they and the housing market bust have caused the spectacular drop in home prices. Even today, with a plethora of information on how to avoid home owner scams and how to make sure you can really afford your home, people are still losing their homes due to job cuts, job losses and just plain bad budgeting.

Despite the spike in home purchases, it would be unwise to take this as a sign that the recession is over or that the economy is gaining equilibrium. It remains to be seen whether the year’s spike in home sales will continue on into 2010. If so, perhaps it is indicative of a positive change in the nation’s finances, but there are definitely some doubts in that regard.

Items on Amazon Right Now for 2009 Sales Tax Deduction Table:

Crocotta Energy Announces Pro-Forma Year-End Reserves and 2010 Capital Budget

CALGARY, ALBERTA– – Crocotta Energy Inc. is pleased to announce its 2009 year-end reserves as independently evaluated by GLJ Petroleum Consultants Ltd., in accordance with National Instrument 51-101 excluding all asset sales previously announced.

President Obama’s Health Care Town Hall, Green Bay

Items on Amazon Right Now for Tax Deduction Mileage:

Garmin nüvi 265W/265WT 4.3-Inch Widescreen Bluetooth Portable GPS Navigator with Traffic $139.99 …

Automatic Mileage Logger For years independent business owners have relied solely on pen, paper and sheer will to deduct mileage at the end of every tax year. As the government raises mileage rates, now at $.505, it’s becoming more and more appealing for micro business owners to keep legitimate mileage log books. You of course know what increases in mileage tax rates mean…increased IRS audit scrutiny. Until recently …

The Ultimate Mileage Log: Lined Format (Volume 1) $7.95 The Ultimate Mileage Log records the information required by the IRS for tracking employee or business owner mileage expenses.Plenty of space is provided for recording all the details of each trip.Two layouts are available, lined and unlined, this copy has the lined format. To view the lined copy visit https://www.createspace.com/3796541…

The Ultimate Mileage Log: Unlined Format (Volume 1) $7.95 The Ultimate Mileage Log records the information required by the IRS for tracking employee or business owner mileage expenses. Plenty of space is provided for recording all the details of each trip. Two layouts are available, lined and unlined, this copy has the unlined format. To view the lined copy visit https://www.createspace.com/3791406…

Bankrate Unveils New Tools and Research for 2010 Tax Season

Now that the New Year is here and tax season is fast approaching, Bankrate, Inc. released its 2010 Tax Guide, filled with tips and tools to help consumers avoid frustration when filing their taxes.

J Brooks & Assoc., presentation – mileage vs receipts Part 2

The IRS initiated a new National Research Program Initiative in November 2009 simply known as the Initiative: an industry wide detailed audit of employment taxes for 6,000 randomly selected businesses for the duration of the next three years. The intent of the Initiative has two aspects: ONE: assess systemic employment tax compliance; and TWO: collect assessments from delinquent employers.

With tax revenues dwindling from the recession, the U.S. Treasury Department is stepping up efforts to close the tax gap the difference between overall tax liabilities and taxes paid to the IRS. Auditing employment taxes is seen by the IRS as a crucial means of closing the tax gap. For tax year 2001 for example, the gross tax gap was estimated by the IRS at around $345 billion, with underreporting of employment taxes accounting for around 17% of the tax gap.

The IRS will audit businesses to ensure that Federal withholding taxes are deducted and paid over to the government from employees wages for Social Security and Medicare as well as Federal Unemployment taxes. An business owner found to be in noncompliance could face harsh civil penalties and interest on unpaid taxes. These penalties could have a particularly severe impact on small business owners.

The IRS has identified four areas to focus their auditing efforts under the Initiative, including:

Worker Classification: i.e. whether an employer properly classifies an employee as an employee or independent contractor for tax purposes. Determining which depends on the behavioral, financial and type of relationship the company has with the person performing the work.

Employee Fringe Benefits: A fringe benefit is a form of pay for the performance of services. i.e. benefits such as insurance coverage, company car or child care, etc. that are provided by employers tax free to employees but not to independent contractors.

Reimbursed Business Expenses: e.g. reimbursement for taking a client to lunch, purchasing office supplies: which requires a written business expense plan. I.E. You must have paid or incurred expenses that are deductible while performing services as an employee. You must adequately account to your employer for these expenses within a reasonable time period, and you must return any excess reimbursement or allowance within a reasonable time period.

Compensation of Owners: who are also employees of the company, whereby unpaid taxes may result in personal liability for the employer.

Harsh penalties can occur for employers that are in noncompliance with employment tax lawaE¦and now that the employment tax audit Initiative is upon us the IRS has been reported to have already begun the process of selecting businesses for audit of their employment taxes. In order to ensure that these procedures are in compliance with applicable tax law is critical and can save time, money and heartache in the event of an audit.

For example, the Internal Revenue Code has specific requirements for taxing the Compensation of Owners depending on business structure set forth in its operating agreement and what classification the owner has elected. Employers should consider consulting with experienced counsel in preparation for the Initiative and in the event of an audit of their compensation methods to its owners is in question.

Items on Amazon Right Now for Tax Deductible Hsa Contributions:

Living on a freelancer’s budget

Chris and Janie Peterson have an enviable life. They own a lovely 3½-bedroom ranch house just outside Minneapolis and have work schedules flexible enough to allow them lots of time with their children, Reece, 10, Cecily, 9, and Georgio, 7.

Tax Tips & Information : What to Claim on Income Taxes

Question: What does it mean when you have a deductible- Health Insurance****?

What does it mean when you have a 5,000 deductible? does that mean that i order for my insurance to pay I have to first pay 5,000 out of pocket?
If so, what is the point of the Insurance, I’d be paying over $200 a month, as well as paying for all my doctor visits until reach 5,000 THEN my insurance kicks in?

Answer: That’s exactly what a deductible is. The reason you still need the coverage is in case you have some catastrophe and you don’t end up with tens or hundreds of thousands dollars in medical bills.

It’s very frustrating and that’s why we need health care reform.

EDIT: I (along with thousands, maybe millions) also have a $5000 deductible so I don’t know why this other guy is so surprised. You should set up an HSA if your insurance qualifies which allows you to set aside money tax-free for medical expenses.

Items on Amazon Right Now for What Does Deductible Means:

2 Year CPS Consumer Priority Service Extended Warranty for Video Game Consoles Under $1,000.00 $199.99 eBidds Inc. has proudly partnered with Consumer Priority Service (CPS) to offer several Extended Warranty Services. Extended Warranties may not only be purchased for products you are currently buying from eBidds or have bought from us in the last 30 days, but also products purchased from other legitimate retailers. An Extended Service Plan is generally an extension of your original manufacturer’s…

Pros and cons of health savings accounts

Q: What is an insurance plan with an HSA? A: Created in 2003, it’s a health savings account combined with a high-Deductible Health insurance plan. One significant difference from traditional coverage is that it’s owned by the individual, rather than the employer.

Telecasts 19 – Ballad Of A Thin Man – Bob Dylan