E-ssentials Bulletin

E-ssentials Bulletin

General Business, Management & HR Issues

New ownership? How to quell employee fears
Fear is the No. 1 emotion felt by employees faced with a merger, acquisition or change in leadership. Suspicion or mistrust runs a close second. Management can't retreat behind a veil of silence. They must have open lines of communication with employees to earn their trust.

Does your board need an outside member?
Unlike public companies, private companies are not required to include outsiders on their boards. That doesn't mean, however, that outsiders should not be a part of the board. If you think adding an outsider to your board would be valuable to your business, here are some important issues to consider.

Wealth Advice, Retirement & Estate Planning

Avoiding probate: How a revocable trust helps
A last will and testament estate plan will provide the essential details of who will inherit your property, when and how they will inherit it and who will be put in charge of settling your final affairs. A revocable living trust covers these important points, but avoids the probate process. Here are the pros and cons of each.

Statistically, women count on Social Security more
Elderly women receive less than men in Social Security and count on it considerably more. In fact, more than half of unmarried women count on Social Security for 90 percent of their income. Learn more about the statistics of those receiving Social Security.

Washington Tax Update

Form W-4: Follow rules to avoid penalties

Be careful when filling out your W-4 form. The Internal Revenue Service requires that employees fill out a Form W-4 on or before the first day of employment. The W-4 form determines how much federal income tax an employer will withhold from an employee's wages. But there can be civil - or even criminal - penalties for claiming excess withholding allowances on Form W-4.

Expensive lesson: Children in home aren't always dependents

A taxpayer was disallowed dependency exemptions for his son, daughter and grandchild in a January 2015 U.S. Tax Court case. The court also denied him head-of-household filing status. This decision cost the taxpayer $3,540 in additional federal income taxes and penalties of $708.

Cross t's and dot i's for nontaxable disability benefits

The U.S. Tax Court ruled that disability retirement pay received by Kevin M. Campbell was taxable income despite the fact that, in previous years, the Internal Revenue Service had treated it as nontaxable.

Forms 1099: File tax return timely - but not too early

Hold off on filing your income tax return until all Forms 1099 are received. Otherwise, you might be amending your return.

Log carefully to take advantage of 2015 mileage rates

Now is the time to begin logging your business travel miles if you want to take a tax deduction for 2015. The IRS requires strong substantiation. Estimates are not acceptable. Each business trip should be documented with destination, purpose of trip, date, time and number of miles driven. Business driving must be separated from personal driving.

Rules affecting personal income tax extended

Certain expiring tax provisions were extended on Dec. 19, 2014, when President Obama signed into law the Tax Increase Prevention Act of 2014. The law includes some interesting individual income tax provisions.

Time use of college tuition credit carefully

The U.S. Tax Court recently determined that a cash method taxpayer is entitled to claim an American Opportunity Credit only in the tax year when the payment was actually made - not for the academic year when the tuition payment was paid.

Are you getting ready for tax season?

When it comes to income taxes, it pays to be organized. Begin gathering your tax information as early as it is available. You should receive most of your 2014 tax documents by early to mid-February 2015.

The technical information here is necessarily brief. No final conclusion on these topics should be drawn without further review and consultation.

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