Many Maine-based small business owners start out with an office in their homes. An important benefit to this is being able to deduct the expense of the office on the tax return. It’s key for home-based business owners to know that in order to receive the deduction, the space must be used regularly and exclusively  Continue Reading »

Ward v. Ward, 2014 W.Va. LEXIS 128 (Feb. 14, 2014) In a divorce case, the husband appealed to the state’s highest court, arguing that the lower courts accepted a valuation of his business interest that did not reflect the company as it was on the valuation date. Rather, he said, the valuation was set by  Continue Reading »

Many Maine-based small business owners assume their companies are less susceptible to fraud than large corporations. It seems like their operations are more tightly controlled, with many trustworthy and longtime employees on the payroll. Unfortunately, however, this is not true. According to the Association of Certified Fraud Examiners (ACFE) Report to the Nations on Occupational Fraud  Continue Reading »

Alli v. Commissioner, 2014 Tax Ct. Memo LEXIS 15 (Jan. 27, 2014) A taxpayer handed the IRS an easy victory when he challenged the government’s denial of his claim for a charitable contribution deduction related to his S corporation’s donation of a neglected apartment building. The dispute centered on meeting certain requirements of Section 170  Continue Reading »

Many Maine-based small business owners want to develop a company mission statement. They realize that a good one can highlight products and services, as well as align employees around a common vision. But the truth is that many mission statements fail, becoming nothing more than a paragraph within a company handbook. The reason why mission  Continue Reading »

SEP Basics The SEP is a stripped-down retirement plan mainly intended for self-employed individuals and small corporate employers. If you’re self-employed, you can make an annual deductible contribution of up to 20 percent of your income to a SEP account. If you’re employed by an S or C corporation, the company must establish the SEP on  Continue Reading »

As a Maine-based small business owner, it may make sense to share employees with one or more related companies, each paying its share of wages and compensation. This might make sense for a number of reasons, but one important one is that a “common paymaster” approach can help save money on payroll taxes for employees  Continue Reading »

As a Maine-based small business owner, you may be wondering if you can write off bad debts at tax time. Since cash-basis companies don’t recognize revenue until it’s received, and therefore wouldn’t have anything on the books to deduct, only businesses that record income on an accrual basis can write off uncollectible accounts. These accrual-based  Continue Reading »

Hamelink v. Hamelink, 2014 Minn. App. Unpub. LEXIS 1175 (Dec. 30, 2013) Since Bernier v. Bernier, a Massachusetts divorce case in which the state’s highest court required that a valuation for equitable distribution purposes use a hybrid tax-affecting model to account for an S corporation owner’s personal taxes on company profits, few marriage-dissolution decisions have  Continue Reading »

As all small business owners know, no sale is really a sale until the money is in. Most businesses no longer operate on a cash and carry basis, so customers buy on credit. This means that often the receipt of that money is delayed. Every time a company extends credit it takes a risk that  Continue Reading »