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Tax Tips
Any accounting, business or tax advice contained in this communication, including attachments and enclosures, is not intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax-related penalties. If desired, we would be pleased to perform the requisite research and provide you with a detailed written analysis. Such an engagement may be the subject of a separate engagement letter that would define the scope and limits of the desired consultation services.
- Section 1202 Exclusion Example
- Start Up Tax Exemption
Section 1202 Exclusion Example
Section 1202 Exclusion Example: What You Need to Know
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The Section 1202 exclusion example is a provision in the new tax law that allows businesses to exclude from their taxable income up to 80% of the gain on the sale of certain qualifying small business stock (QSBS). This provision is effective for sales of QSBS acquired after December 31, 2017, and is retroactive to sales made after September 27, 2010. In this article, we will be discussing what you need to know about the Section 1202 exclusion example. This is a great way to learn more about how the section works and how it can benefit you.
The Section 1202 exclusion allows for the gain from the sale of certain small business stock to be excluded from your taxable income. This provision is designed to help promote investment in small businesses. To qualify for the exclusion, the stock must be issued by a qualifying small business. The business must also meet certain other requirements, such as being engaged in a qualified trade or business and having gross assets of $50 million or less.
If you sell your QSBS for a profit, you may be able to exclude up to 80% of the gain from your taxable income. This can be a significant tax savings for investors in small businesses. The Section 1202 exclusion is a great way to encourage investment in small businesses and help them grow. If you are thinking about investing in a small business, be sure to check if the business qualifies for the exclusion. It could save you a lot of money in taxes.
What are the requirements for a qualifying small business
For qualifying small business stock, the stock must be issued by a domestic C corporation that meets the following requirements:- The corporation is engaged in a qualified trade or business. This is generally any business other than a financial institution, farming, or natural resources extraction. Section 1202(e)(3) of the tax code defines a qualified trade or business for this purpose.
- The corporation is not a publicly traded company. This means that the stock cannot be listed on a major stock exchange.
- The stock is acquired by the taxpayer at original issuance in exchange for money, property (not including stock), or services rendered to the corporation.
- The corporation must issue the stock for cash, property (not including stock), or services rendered to the corporation.
- The corporation must be a C corporation at the time the stock is issued.
- During substantially all of the taxpayer's holding period, the corporation must meet the active business requirement. This means that at least 80% of the value of the corporation's assets must be used in the active conduct of a qualified trade or business.
Qualified Small Business Stock Inc https://www.google.com/maps?cid=1473137287620394883814855 S 46th St., Phoenix, AZ 85044(480) 734-3758Start Up Tax Exemption
10 Questions to Ask Your Accountant About Start Up Tax Exemption
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Start Up Services[/caption]
Start up tax exemptions is a great way to help new businesses get started. They can help reduce the amount of money you owe in taxes, which can free up money to invest in your business. However, it's important to understand how start up tax exemption work before you apply for them. When starting a new business, it's important to be aware of the tax exemptions that are available to you. This can help you save money on your taxes and free up money to invest in your business.
Start up tax exemption is a great way to reduce the amount of taxes you owe. It is also a way to free up some money to invest in your business. However, there are a few things you should know about start up tax exemption before applying for one. Here are 10 questions to ask your accountant about start up tax exemption:
- What is a start up tax exemption? A start up tax exemption is a way to reduce the amount of taxes you owe on your business. It can help you free up money to invest in your business. This is because the government will not tax your business in its first year of operation.
- How does a start-up tax exemption work? A start up tax exemption can help reduce the amount of taxes you owe in the first year of operation. This can help you free up money to invest in your business.
- What are the benefits of a start up tax exemption? A start up tax exemption can help reduce the amount of taxes you owe. This is a great way to free up money to invest in your business. It can also help you get your business started on the right foot.
- How do I apply for a start up tax exemption? You can apply for a start up tax exemption by filling out the necessary paperwork with the government. These forms can be found online or through your local government office.
- What are the requirements for a start up tax exemption? There are certain requirements you must meet in order to qualify for a start up tax exemption. These requirements vary from country to country. However, some common requirements include being a new business, having a certain number of employees, and making a certain amount of revenue.
- How long does a start-up tax exemption last? A start up tax exemption typically lasts for the first year of operation. However, this can vary depending on the country you are in.
- What happens if I don't qualify for a start-up tax exemption? If you don't qualify for a start up tax exemption, you will have to pay taxes on your business. However, there may be other tax breaks or incentives you can take advantage of.
- Can I apply for a start up tax exemption if I'm not a new business? No, you must be a new business in order to qualify for a start up tax exemption. This is because the government wants to help new businesses get started.
- Do I need to have a certain number of employees to qualify for a start up tax exemption? This depends on the country you are in. Some countries require that you have a certain number of employees, while others do not.
- How much money can I save with a start up tax exemption? The amount of money you can save with a start up tax exemption varies. It depends on the country you are in and the amount of taxes you owe. However, it is a great way to save money on your taxes and free up money to invest in your business.
Qualified Small Business Stock Inc https://www.google.com/maps?cid=1473137287620394883814855 S 46th St., Phoenix, AZ 85044(480) 734-3758
TAX DUE DATES FOR DEC 2022
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TAX DUE DATES FOR NOV 2022
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TAX DUE DATES FOR OCT 2022
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TAX DUE DATES FOR SEPT 2022
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TAX DUE DATES FOR AUGust 2022
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TAX DUE DATES FOR JULY 2022
JULY 11
Employees Who Work for Tips – If you received $20 or more in tips during June, report them to your employer. You can use Form 4070.
JULY 15
Employers – Nonpayroll withholding. If the monthly deposit rule applies, deposit the tax for payments in June.
Employers – Social Security, Medicare, and withheld income tax. If the monthly deposit rule applies, deposit the tax for payments in June.
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TAX DUE DATES FOR JUNE 2022
june 10
Employees – who work for tips. If you received $20 or more in tips during May, report them to your employer. You can use Form 4070.
june 15
Individuals – If you are a U.S. citizen or resident alien living and working (or on military duty) outside the United States and Puerto Rico, file Form 1040 or Form 1040-SR and pay any tax, interest, and penalties due. If you want additional time to file your return, file Form 4868 to obtain 4 additional months to file. Then file Form 1040 or Form 1040-SR by October 17.
However, if you are a participant in a combat zone you may be able to further extend the filing deadline.
Individuals – Make a payment of your 2022 estimated tax if you are not paying your income tax for the year through withholding (or will not pay in enough tax that way). Use Form 1040-ES. This is the second installment date for estimated tax in 2022.
Corporations – Deposit the second installment of estimated income tax for 2022. A worksheet, Form 1120-W, is available to help you estimate your tax for the year.
Employers – Nonpayroll withholding. If the monthly deposit rule applies, deposit the tax for payments in May.
Employers – Social Security, Medicare, and withheld income tax. If the monthly deposit rule applies, deposit the tax for payments in May.
Copyright © 2022 All materials contained in this document are protected by U.S. and international copyright laws. All other trade names, trademarks, registered trademarks and service marks are the property of their respective owners.
TAX DUE DATES FOR MAY 2022
MAY 2
Employers – Federal unemployment tax. Deposit the tax owed through April if more than $500.
Employers – Social Security, Medicare, and withheld income tax. File Form 941 for the first quarter of 2022. Deposit any undeposited tax. If your tax liability is less than $2,500, you can pay it in full with a timely filed return. If you deposited the tax for the quarter in full and on time, you have until May 10 to file the return.
MAY 10
Employees who work for tips – If you received $20 or more in tips during April, report them to your employer. You can use Form 4070.
Employers – Social Security, Medicare, and withheld income tax. File Form 941 for the first quarter of 2022. This due date applies only if you deposited the tax for the quarter in full and on time.
MAY 16
Employers – Nonpayroll withholding. If the monthly deposit rule applies, deposit the tax for payments in April.
Employers – Social Security, Medicare, and withheld income tax. If the monthly deposit rule applies, deposit the tax for payments in April.
Copyright © 2022 All materials contained in this document are protected by U.S. and international copyright laws. All other trade names, trademarks, registered trademarks and service marks are the property of their respective owners.
TAX DUE DATES FOR APRIL 2022
APRIL 11
Employees who work for tips – If you received $20 or more in tips during March, report them to your employer. You can use Form 4070.
APRIL 18
Individuals – File an income tax return for 2021 (Form 1040 or Form 1040-SR) and pay any tax due. If you live in Maine or Massachusetts, you may file by April 19. If you want an automatic 6-month extension of time to file the return, file Form 4868, Application for Automatic Extension of Time To File U.S. Individual Income Tax Return and pay what you estimate you owe in tax to avoid penalties and interest. Then file Form 1040 or Form 1040-SR by October 17.
Household Employers – If you paid cash wages of $2,300 or more in 2021 to a household employee, file Schedule H (Form 1040 or Form 1040-SR) with your income tax return and report any employment taxes. Report any federal unemployment (FUTA) tax on Schedule H (Form 1040 or Form 1040-SR) if you paid total cash wages of $1,000 or more in any calendar quarter of 2020 or 2021 to household employees.
Employers – Nonpayroll withholding. If the monthly deposit rule applies, deposit the tax for payments in March.
Employers – Social Security, Medicare, and withheld income tax. If the monthly deposit rule applies, deposit the tax for payments in March.
Individuals – If you are not paying your 2022 income tax through withholding (or will not pay in enough tax during the year that way), pay the first installment of your 2022 estimated tax. Use Form 1040-ES.
Corporations – File a 2021 calendar year income tax return (Form 1120) and pay any tax due. If you want an automatic 6-month extension of time to file the return, file Form 7004 and deposit what you estimate you owe in taxes.
Corporations – Deposit the first installment of estimated income tax for 2022. A worksheet, Form 1120-W, is available to help you estimate your tax for the year.
MAY 2
Employers – Federal unemployment tax. Deposit the tax owed through April if more than $500.
Employers – Social Security, Medicare, and withheld income tax. File form 941 for the first quarter of 2022. Deposit any undeposited tax. (If your tax liability is less than $2,500, you can pay it in full with a timely filed return.) If you deposited the tax for the quarter in full and on time, you have until May 10 to file the return.
Copyright © 2022 All materials contained in this document are protected by U.S. and international copyright laws. All other trade names, trademarks, registered trademarks and service marks are the property of their respective owners.
TAX DUE DATES FOR MARCH 2022
MARCH 1
Farmers and Fisherman – File your 2021 income tax return (Form 1040 or Form 1040-SR) and pay any tax due. However, you have until April 18 (April 19 if you live in Maine or Massachusetts) to file if you paid your 2021 estimated tax by January 18, 2022.
MARCH 2
Health Coverage Reporting – If you are an Applicable Large Employer, provide Form 1095-C, Employer-Provided Health Insurance Offer and Coverage, to full-time employees. For all other providers of minimum essential coverage, provide Form 1095-B, Health Coverage, to responsible individuals.
MARCH 10
Employees who work for tips – If you received $20 or more in tips during February, report them to your employer. You can use Form 4070.
MARCH 15
Employers – Nonpayroll withholding. If the monthly deposit rule applies, deposit the tax for payments in February.
Employers – Social Security, Medicare, and withheld income tax. If the monthly deposit rule applies, deposit the tax for payments in February.
Partnerships – File a 2021 calendar year income tax return (Form 1065). Provide each partner with a copy of their Schedule K-1 (Form 1065-B) or substitute Schedule K-1. To request an automatic 6-month extension of time to file the return, file Form 7004. Then file the return and provide each partner with a copy of their final or amended (if required) Schedule K1 (Form 1065) by September 15.
S Corporations – File a 2021 calendar year income tax return (Form 1120S) and pay any tax due. Provide each shareholder with a copy of Schedule K-1 (Form 1120S), Shareholder’s Share of Income, Credits, Deductions, etc., or a substitute Schedule K-1. If you want an automatic 6-month extension of time to file the return, file Form 7004 and deposit what you estimate you owe in tax. Then file the return, pay any tax, interest, and penalties due and provide each shareholder with a copy of their Schedule K-1 by September 15.
S Corporation Election – File Form 2553, Election by a Small Business Corporation, to choose to be treated as an S corporation beginning with calendar year 2022. If Form 2553 is filed late, S corporation treatment will begin with calendar year 2023.
MARCH 31
Electronic Filing of Forms – File Forms 1097, 1098, 1099 (except Form 1099-NEC), 3921, 3922, and W-2G with the IRS. This due date applies only if you file electronically. The due date for giving the recipient these forms generally remains January 31.
Electronic Filing of Form W-2G – File copies of all the Form W-2G (Certain Gambling Winnings) you issued for 2021. This due date applies only if you electronically file. The due date for giving the recipient these forms remains January 31.
Electronic Filing of Forms 8027 – File copies of all the Forms 8027 you issued for 2021. This due date applies only if you electronically file.
Electronic Filing of Forms 1094-C and 1095-C and Forms 1094-B and 1095-B – If you’re an Applicable Large Employer, file electronic forms 1094-C and 1095-C with the IRS. For all other providers of minimum essential coverage, file electronic Forms 1094-B and 1095-B with the IRS.
Copyright © 2022 All materials contained in this document are protected by U.S. and international copyright laws. All other trade names, trademarks, registered trademarks and service marks are the property of their respective owners.
TAX DUE DATES FOR FEBRUARY 2022
FEBRUARY 10
Employees – who work for tips. If you received $20 or more in tips during January, report them to your employer. You can use Form 4070.
Employers – Social Security, Medicare, and withheld income tax. File Form 941 for the fourth quarter of 2021. This due date applies only if you deposited the tax for the quarter in full and on time.
Farm Employers – File Form 943 to report Social Security and Medicare taxes and withheld income tax for 2021. This due date applies only if you deposited the tax for the year in full and on time.
Certain Small Employers – File Form 944 to report Social Security and Medicare taxes and withheld income tax for 2021. This tax due date applies only if you deposited the tax for the year in full and on time.
Employers – Nonpayroll taxes. File Form 945 to report income tax withheld for 2021 on all nonpayroll items. This due date applies only if you deposited the tax for the year in full and on time.
Employers – Federal unemployment tax. File Form 940 for 2021. This due date applies only if you deposited the tax for the year in full and on time.
FEBRUARY 15
Individuals – If you claimed exemption from income tax withholding last year on the Form W-4 you gave your employer, you must file a new Form W-4 by this date to continue your exemption for another year.
Employers – Social Security, Medicare, and withheld income tax. If the monthly deposit rule applies, deposit the tax for payments in January.
Employers – Nonpayroll withholding. If the monthly deposit rule applies, deposit the tax for payments in January.
All businesses. Give annual information statements to recipients of certain payments made during 2021. You can use the appropriate version of Form 1099 or other information return. This due date applies only to payments reported on Form 1099-B, Form 1099-S, and substitute payments reported in Box 8 or gross proceeds paid to an attorney reported in Box 10 of Form 1099-MISC.
FEBRUARY 16
Employers – Begin withholding income tax from the pay of any employee who claimed exemption from withholding in 2021, but did not give you a new Form W-4 to continue the exemption this year.
FEBRUARY 28
Businesses – File information returns (for example, certain Forms 1099) for certain payments you made during 2021. However, Form 1099-NEC reporting nonemployee compensation must be filed by January 31. There are different forms for different types of payments. Use a separate Form 1096 to summarize and transmit the forms for each type of payment. See the General Instructions for Certain Information Returns for information on what payments are covered, how much the payment must be before a return is required, what form to use, and extensions of time to file.
If you file Forms 1097, 1098, 1099 (except a Form 1099-NEC reporting nonemployee compensation), 3921, 3922 or W-2G electronically, your due date for filing them with the IRS will be extended to March 31. The due date for giving the recipient these forms generally remains January 31.
Payers of Gambling Winnings – File Form 1096, Annual Summary and Transmittal of U.S. Information Returns, along with Copy A of all the Forms W-2G you issued for 2021. If you file Forms W-2G electronically, your due date for filing them with the IRS will be extended to March 31. The due date for giving the recipient these forms remains January 31.
Health Coverage Reporting – If you are an Applicable Large Employer, file paper Forms 1094-C, Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns, and 1095-C with the IRS. For all other providers of minimum essential coverage, file paper Forms 1094-B, Transmittal of Health Coverage Information Returns, and 1095-B with the IRS. If you are filing any of these forms with the IRS electronically, your due date for filing them will be extended to March 31.
Large Food and Beverage Establishment Employers – with employees who work for tips. File Form 8027, Employer’s Annual Information Return of Tip Income and Allocated Tips. Use Form 8027-T, Transmittal of Employer’s Annual Information Return of Tip Income and Allocated Tips, to summarize and transmit Forms 8027 if you have more than one establishment. If you file Forms 8027 electronically your due date for filing them with the IRS will be extended to March 31.
MARCH 1
Farmers and Fisherman – File your 2021 income tax return (Form 1040 or Form 1040-SR) and pay any tax due. However, you have until April 15 (April 19 if you live in Maine or Massachusetts) to file if you paid your 2021 estimated tax by January 18, 2021.
MARCH 2
Health Coverage Reporting – If you are an Applicable Large Employer, provide Form 1095-C, Employer-Provided Health Insurance Offer and Coverage, to full-time employees. For all other providers of minimum essential coverage, provide Form 1095-B, Health Coverage, to responsible individuals.
Copyright © 2022 All materials contained in this document are protected by U.S. and international copyright laws. All other trade names, trademarks, registered trademarks and service marks are the property of their respective owners.
TAX DUE DATES FOR JANUARY 2022
DURING JANUARY
All employers – Give your employees their copies of Form W-2 for 2021 by January 31, 2022. If an employee agreed to receive Form W-2 electronically, post it on a website accessible to the employee and notify the employee of the posting.
JANUARY 3
Employers – Payment of deferred employer share of social security tax from 2020. If the employer deferred paying the employer share of social security tax or the railroad retirement tax equivalent in 2020, pay 50% of the deferred amount of the employer share of social security tax by January 3, 2022. The remaining 50% of the deferred amount of the employer share of social security tax is due by January 3, 2023. Any payments or deposits made before January 3, 2022, are first applied against the payment due by January 3, 2022, and then applied against the payment due on January 3, 2023.
Employers – Payment of the deferred employee share of social security tax from 2020. If the employer deferred withholding and payment of the employee share of social security tax or the railroad retirement tax equivalent on certain employee wages and compensation between September 1, 2020, and December 31, 2020, it should have withheld and paid those taxes ratably from wages paid to the employee between January 1, 2021, and December 31, 2021. The employer is liable to pay the deferred taxes to the IRS and must do so before January 3, 2022.
JANUARY 10
Employees – who work for tips. If you received $20 or more in tips during December 2021, report them to your employer. You can use Form 4070, Employee’s Report of Tips to Employer.
JANUARY 18
Employers – Social Security, Medicare, and withheld income tax. If the monthly deposit rule applies, deposit the tax for payments in December 2021.
Individuals – Make a payment of your estimated tax for 2021 if you did not pay your income tax for the year through withholding (or did not pay in enough tax that way). Use Form 1040-ES. This is the final installment date for 2021 estimated tax. However, you do not have to make this payment if you file your 2021 return (Form 1040 or Form 1040-SR) and pay any tax due by January 31, 2022.
Employers – Nonpayroll Withholding. If the monthly deposit rule applies, deposit the tax for payments in December 2021.
Farmers and Fisherman – Pay your estimated tax for 2021 using Form 1040-ES. You have until April 18 (April 19 if you live in Maine or Massachusetts) to file your 2021 income tax return (Form 1040 or Form 1040-SR). If you do not pay your estimated tax by January 18, you must file your 2021 return and pay any tax due by March 1, 2022, to avoid an estimated tax penalty.
JANUARY 31
Employers – Give your employees their copies of Form W-2 for 2021. If an employee agreed to receive Form W-2 electronically, have it posted on a website and notify the employee of the posting. File Form W-3, Transmittal of Wage and Tax Statements, along with Copy A of all the Forms W-2 you issued for 2021.
Payers of nonemployee compensation – File Form 1099-NEC for nonemployee compensation paid in 2021.
Individuals – who must make estimated tax payments. If you did not pay your last installment of estimated tax by January 18, you may choose (but are not required) to file your income tax return (Form 1040 or Form 1040-SR) for 2021 by January 31. Filing your return and paying any tax due by January 31, 2022, prevents any penalty for late payment of the last installment. If you cannot file and pay your tax by January 31, file and pay your tax by April 18 (April 19 if you live in Maine or Massachusetts).
Employers – Federal unemployment tax. File Form 940 for 2021. If your undeposited tax is $500 or less, you can either pay it with your return or deposit it. If it is more than $500, you must deposit it. However, if you already deposited the tax for the year in full and on time, you have until February 10 to file the return.
Farm Employers – File Form 943 to report social security and Medicare taxes and withheld income tax for 2021. Deposit or pay any undeposited tax under the accuracy of deposit rules. If your tax liability is less than $2,500, you can pay it in full with a timely filed return. If you deposited the tax for the year in full and on time, you have until February 10 to file the return.
Certain Small Employers – File Form 944 to report Social Security and Medicare taxes and withheld income tax for 2021. Deposit or pay any undeposited tax under the accuracy of deposit rules. If your tax liability is $2,500 or more from 2021 but less than $2,500 for the fourth quarter, deposit any undeposited tax or pay it in full with a timely filed return. If you deposited the tax for the year timely, properly, and in full, you have until February 10 to file the return.
Employers – Social Security, Medicare, and withheld income tax. File Form 941 for the fourth quarter of 2021. Deposit any undeposited tax. If your tax liability is less than $2,500, you can pay it in full with a timely filed return. If you deposited the tax for the quarter in full and on time, you have until February 10 to file the return.
Employers – Nonpayroll taxes. File Form 945 to report income tax withheld for 2021 on all nonpayroll items, including backup withholding and withholding on pensions, annuities, IRAs, gambling winnings, and payments of Indian gaming profits to tribal members. Deposit any undeposited tax. If your tax liability is less than $2,500, you can pay it in full with a timely filed return. If you deposited the tax for the year in full and on time, you have until February 10 to file the return.
Payers of Gambling Winnings – If you either paid reportable gambling winnings or withheld income tax from gambling winnings, give the winners their copies of Form W-2G.
Businesses – Give annual information statements to recipients of certain payments made during 2021. You can use the appropriate version of Form 1099 or other information return. Form 1099 can be issued electronically with the consent of the recipient. This due date only applies to certain types of payments.
Copyright © 2022 All materials contained in this document are protected by U.S. and international copyright laws. All other trade names, trademarks, registered trademarks and service marks are the property of their respective owners.