By purchasing stock in certain small businesses, you can not only diversify your portfolio but also enjoy preferential tax treatment. And under a provision of the tax extenders act signed into law this past December (the PATH Act), such stock is now even more attractive from a tax perspective.
100% exclusion from gain
The PATH Act makes permanent the exclusion of 100% of the gain on the sale or exchange of qualified small business (QSB) stock acquired and held for more than five years. The 100% exclusion is available for QSB stock acquired after September 27, 2010. (Smaller exclusions are available for QSB ...
The latest manufacturing industry statistics are generally encouraging and most observers remain cautiously optimistic as 2016 approaches.
But news coverage usually focuses on output. What about handling inventory in this environment of varying supply and demand? This is a constant concern for manufacturers, and possibly you're among them. By improving inventory management, you may be able to brighten your firm's immediate outlook by maintaining good customer service and trimming costs.
Potential Problem Areas
Naturally, different sorts of problems arise in different markets, whether its pharmaceuticals, packaged goods or some other industry. But there are ...
The Affordable Care Act (ACA) seems to be making Health Savings Accounts (HSAs) more popular than ever. A recent report issued by Devenir, an HSA industry participant, highlights two key findings:
1. As of June 30, 2015, the number of HSAs climbed 23% from the previous year to 14.5 million, and
2. Account balances jumped 25% to approximately $28.4 billion over the same time period.
In 2010, the Employee Benefit Research Institute reported that there were 5.7 million HSAs with balances totaling $7.7 billion. Clearly, these accounts are becoming more popular.
Under the ACA, health...
The research credit isn't the only tax break available for research activities. Section 174 of the tax code allows taxpayers to elect to either: 1) deduct "research or experimental expenditures" or 2) amortize the costs over a period of not less than 60 months. Qualified expenses are limited to the following:
- In-house wages and supplies attributable to qualified research,
- Certain time-sharing costs for computer use in qualified research, and
- 65% of contract research expenses, that is, amounts paid to outside contractors in the U.S. for conducting qualified research on the taxpayer's ...
Succession planning is important in any business, but it's sometimes overlooked in family-owned operations. This is a big mistake. There are numerous former family-run companies that no longer exist due to poor or no succession plan.
The plan needs to be well thought out and discussed with everyone affected. Don't just assume that a son or daughter will want to carry on the family business. Even if your children say they will take over, they may not have the true desire required to continue a successful operation.
The "heir to the throne" also may not have the business skills to succeed...
In 2015, FASB finalized the long-awaited revenue recognition project. This impacts GAAP financial statements for all for-profits and any not-for-profit entities that have exchange transaction revenues (non-contribution revenues.) Non-public companies must adopt the revenue recognition standard for years beginning after December 15, 2018.
FASB is still working through implementation questions that have come up and additional guidance is still being issued.
Why the long implementation period? It's simple; many entities will need to make changes in their accounting and other computer systems to properly track and aggregate the data needed to implement these changes.