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IRS: Bitcoins Are Property, Not Currency

bitcoinsIn guidance issued on Tuesday, March 25, 2014, the IRS warned that virtual currencies, such as Bitcoin, are to be treated as property and not as currency for tax purposes.

"General tax principles that apply to property transactions apply to transactions using virtual currency," the IRS said in the guidance statement. Read More ›

Categories: News & Events, Tax

Corporate Sponsorships for Your 501(c)(3) Organization

Tax-exempt 501(c)(3) charitable organizations can raise money by asking businesses to "sponsor" an event or initiative. These sponsorships can provide much needed revenue to the charity and can help to support an event that allows the charity to raise even more money.

The business that sponsors the event or initiative benefits from the public recognition and from the deduction that it receives for the sponsorship amount, either as a charitable contribution under Internal Revenue Code ("IRC") Section 170 or as an advertising expense under IRC Section 162. Read More ›

Categories: Nonprofit, Tax

Avoid Potential Tax Penalties on Foreign Bank Accounts and Investments

U.S. investors and businesses can be subject to severe tax penalties for failing to properly report their foreign bank accounts, investments and subsidiaries to the Internal Revenue Service (IRS). The potential penalties can be more than $10,000 per year, and can be assessed in addition to taxes and interest! Read More ›

Categories: Tax

Are you missing out on these exemptions?

There have been several recent tax changes to Michigan tax law. New exemptions may be valuable to you. Consult a tax professional for advice as to how to make the most of available tax benefits.

Sales Tax Exemption for Vehicle Trade-Ins

Starting Dec. 15, 2013, up to $2,000 of the value of a motor vehicle or recreational vehicle traded-in to pay for a new or used motor or recreational vehicle may be exempt from sales tax. The agreed-upon value must be separately stated. Starting Jan. 1, 2015, the exemption limit is increased by an additional $500 per year.

Use Tax Exemption for Vehicle Trade-Ins

Also starting Dec. 15, 2013, up to $2,000 of the value of a motor vehicle or recreational vehicle traded-in to pay for a new or used motor or recreational vehicle may be exempt from use tax.

Categories: Sales Tax, Tax, Use Tax

Avoid Taxes and Penalties on Your Business’s Compensation Arrangements

compensation arrangementsHas your business promised to pay a benefit to an employee or an independent contractor at some time in the future? If so, your promise may be subject to the complex rules of Section 409A of the Internal Revenue Code. Read More ›

Categories: Employee Benefits, Tax

Encourage Your Employees to Grow Your Business

You have a reason to grow your business—you’ll make more money. You also have a reason to stick around—the proverbial pot of gold at the end of the rainbow. But what about your key employees? You should consider giving them the same incentives. Read More ›

Categories: Employee Benefits, Labor Relations

Ownership Requirements Changed for Professional Limited Liability Companies and Professional Corporations Engaged in the Practice of Public Accounting

On October 15, 2013, the Michigan Limited Liability Company Act (LLC Act) and the Business Corporation Act (Corporation Act) (collectively the Acts) were both amended to permit non-licensed individuals to be owners of Professional Limited Liability Companies (PLLCs) and Professional Corporations (PCs) that provide public accounting services.

The Acts generally require that owners of PLLCs and PCs be a licensed professional of the service provided by the company. The amendments create an exception and allow non-licensed individuals to be owners of public accounting PLLCs and PCs as long as at least 50% of the equity and voting rights are held directly or beneficially by individuals who are Certified Public Accountants (CPAs). Public accounting is now the only profession under each of the Acts allowed to admit non-licensed individuals as owners. Read More ›

Categories: News & Events

Michigan Treasury instructs same-sex couples to file separate state income tax returns

The Michigan Department of Treasury will require that same-sex couples file their Michigan income tax returns as single filers, even though same-sex couples are required to file joint federal income tax returns. Read More ›

Categories: Tax

Same-Sex Marriages Are Recognized for Federal Tax Purposes

The U.S. Department of Treasury and the IRS have ruled that, effective as of September 16, 2013, same-sex couples who are legally married in a jurisdiction that recognizes same-sex marriage must be treated as married for all federal tax purposes. Accordingly, married same-sex couples must file their 2013 federal income tax returns as either “married filing jointly” or “married filing separately.” They may also choose to file original or amended federal tax returns for 2010, 2011, and 2012 and claim refunds. Some taxpayers may be eligible to claim refunds for earlier tax years. Read More ›

Categories: Tax

Restaurant Owner Held Personally Liable for Unpaid Sales and Use Taxes

Plate with moneyOn May 23rd, the Michigan Court of Appeals upheld a tax tribunal decision that held a restaurant owner personally liable for unpaid taxes, even though that owner had minimal involvement in the preparation of those taxes. Griffin, Jr. v. Dep't of Treasury. The restaurant had failed to pay its sales and withholding tax liabilities for four months, resulting in bills for the unpaid taxes, penalties, and interest on the overdue amount. Based on MCL 205.27a, the Department of Treasury sought to hold the restaurant owner personally liable for the tax bill. Why was an individual liable for the unpaid taxes of a business? ›

Categories: Sales Tax, Use Tax