The Small Business Jobs Act of 2010 has been one of many controversial pieces of legislation that have become law this year. Right here on OPEN Forum there were differing opinions on the value and efficacy of the legislation, as you can see here and here. While this debate will continue for some time, business owners need to make decisions on how to take advantage of specific provisions of the law that impact their businesses. Failing to do so may cost you many thousands of dollars or more in … [Read more...]

Few activities can be considered less desirable than an  IRS audit by the Internal Revenue Service.  Even a root canal may rank slightly above it.     Last year, 1.03 percent of tax returns filed were audited.  This represents over 1.4 million audits. Over 97 percent of these audits were for individual tax returns, leaving a small percentage for business audits.  For small corporations, only 0.85 percent of returns were audited, 0.4 percent of Subchapter S corporations, and 0.38 percent of … [Read more...]

State governments across the country are facing some of the worst budget deficits in history.  According to the National Conference of State Legislatures, a bipartisan organization that provides research, technical assistance and opportunities for idea exchange among legislators, states are facing an aggregate budget gap of at least $83.9 billion for the 2011 Fiscal Year. This estimate is likely to increase materially as the economic recovery fails to materialize.    For the 2010 Fiscal … [Read more...]

There is a great deal of buzz starting to generate around the “value-added tax” (or VAT).  The concept of a VAT was first proposed by Wilhelm von Siemens, son of the founder of Siemens in 1918.  The first country to implement a value-added tax was France in 1954.  Today, nearly 100 countries have a VAT.  The U.S., so far, is not among the list.  But that may change soon.    Many experts are arriving at the conclusion that income tax increases and spending reductions alone will not be enough to … [Read more...]

For every one dollar in federal income taxes owed, the IRS is only able to collect 84 cents. The missing 16 cents is called the tax gap. New 1099 Filing Requirements for 2011 It’s the difference between what individuals and businesses should pay and what they actually do pay. After adjusting for late payments and enforcement actions by the IRS, the “net tax gap” is estimated to be approximately $290 billion a year. With the federal budget suffering from massive deficits, closing the net … [Read more...]