Finance

If grandparents own a 529 but plan to pay my child’s tuition, how is that treated on the FAFSA after the recent changes?

작성자:

Understanding Grandparent 529 Plans and FAFSA Changes Recent changes to the Free Application for Federal Student Aid (FAFSA) have significantly altered how grandparent-owned 529 education savings plans affect a student’s financial aid eligibility. Unlike distributions from grandparent-owned accounts in previous years, these funds are no longer counted as untaxed income to the student, which previously … 더 읽기

Can I roll a 529 plan to a Roth IRA under the new rules, and what counts as 15 years for the account age requirement?

작성자:

529 to Roth IRA Rollover: New Opportunities for Education Savings Starting in 2024, the SECURE 2.0 Act introduced a groundbreaking provision allowing unused 529 education savings plan funds to be rolled over to Roth IRAs under specific conditions. This new rule provides families with greater flexibility when education costs are lower than expected or when … 더 읽기

If I contribute to an HSA and my spouse has a general-purpose FSA through their employer, does that disqualify our HSA eligibility?

작성자:

Understanding HSA and FSA Compatibility Rules If you contribute to a Health Savings Account (HSA) while your spouse has a general-purpose Flexible Spending Account (FSA) through their employer, you may face HSA eligibility restrictions under IRS rules. The interaction between these accounts can create unexpected tax complications that require careful planning to navigate properly. The … 더 읽기

How can I use an accountable plan to reimburse myself for home internet and phone through my S-corp without raising audit flags?

작성자:

Understanding S-Corp Accountable Plans for Home Office Expenses An accountable plan allows S-corporation owners to reimburse themselves for legitimate business expenses, including home internet and phone costs, without creating taxable income. When structured correctly, these reimbursements can provide significant tax benefits while maintaining compliance with IRS regulations and minimizing audit risk. The key to success … 더 읽기

Does a cash balance plan make sense for a high-income S-corp owner in their 50s, and how does it coordinate with a solo 401(k)?

작성자:

Understanding Cash Balance Plans for S-Corp Owners Cash balance plans represent one of the most powerful retirement savings tools available to high-income S-corp owners, particularly those in their 50s who need to accelerate retirement contributions. These defined benefit plans can allow annual contributions of $100,000 to $300,000 or more, significantly exceeding traditional 401(k) limits. However, … 더 읽기

Can I deduct long-term care premiums for my parents if I pay them directly, and does it trigger the gift tax annual exclusion?

작성자:

Understanding Long-Term Care Premium Deductions and Gift Tax Implications Paying for your parents’ long-term care insurance premiums raises important tax questions about medical deductions and gift tax obligations. While you may be able to deduct these payments as medical expenses under certain circumstances, the transaction could also trigger gift tax considerations depending on the amount … 더 읽기

How should I track home office deductions if I alternate between W-2 employment and 1099 consulting in the same space?

작성자:

Managing Home Office Deductions for Mixed Employment Types Tracking home office deductions becomes complex when you alternate between W-2 employment and 1099 consulting work in the same space. The IRS has different rules for employees versus independent contractors, requiring careful documentation and proportional allocation of expenses. Proper record-keeping and understanding these distinctions can help you … 더 읽기

If my side hustle earns less than the standard deduction, do I still owe self-employment tax and need to make quarterly estimated payments?

작성자:

Understanding Tax Obligations for Small Side Hustles Many new entrepreneurs wonder if earning less than the standard deduction exempts them from all tax obligations. While you may not owe federal income tax on earnings below the standard deduction, self-employment tax operates under different rules and thresholds. Understanding these distinctions is crucial for avoiding unexpected tax … 더 읽기

After receiving a 1099-K for personal reimbursements via payment apps, how do I correct it so I’m not taxed on non-income?

작성자:

Understanding 1099-K Forms for Personal Reimbursements If you’ve received a 1099-K form for personal reimbursements sent through payment apps like Venmo, PayPal, or Zelle, you’re not alone—and more importantly, you likely won’t owe taxes on these amounts. Personal reimbursements for shared expenses, gifts, and other non-business transactions aren’t considered taxable income, even when they trigger … 더 읽기

For an online store using third-party fulfillment, who is responsible for marketplace facilitator sales tax collection in each state?

작성자:

Understanding Sales Tax Responsibility in Modern E-commerce When operating an online store that uses third-party fulfillment services, determining who’s responsible for marketplace facilitator sales tax collection can be complex and varies significantly by state. The responsibility typically depends on whether you’re selling through a marketplace platform (like Amazon or eBay) versus operating your own independent … 더 읽기