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New tax reduction strategies carefully explained and exhaustively researched every two weeks. Receive breaking news updates on tax law changes. Members only monthly AMA with TOTTB.tax.
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FEATURED CONTENT
California’s AB-5 And Its Impact On Small Businesses That Work with Independent Contractors
Question: I run a virtual business with no employees, but independent contractors perform all the work. I heard about that case in California. Should I be doing something different in my business? Do I owe any penalties for how I’ve done it in the past? Answer: Effective January 1, 2020, AB 5, later AB 2257, radically changed the rules and criteria for determining whether a worker’s classification is independent contractor or employee. The so-called “gig law” was effective based on a California Supreme Court case from 2018. The significance of the ruling is that it changed the criteria of worker classification and held that workers are presumptively employees and the burden is on the hiring entity to establish that a worker is an independent contractor not subject to wage order protections in California. Although this is a change impacting California employers, the rest of the country has eagerly watched and hoped to cash in on the changes that would generate billions in employment taxes. Businesses that prefer to work with independent contractors such as Uber and Lyft were quick to propose a ballot initiative in 2020 that the voters passed and now drivers are exempt from the new criteria (insert eyeroll here). Want to know how to get your own exemption from AB-5? Continue reading.
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CURRENT EDITION
A Compendium Of Year End Tax Tips
As summer turns to fall, the leaves turn and houses start being decorated, the air becomes crisper and the internet fills with year-end tax tip pieces. I call them tip sheets. I just love reading tip sheets, but I’m retired from active practice. Somebody who doesn’t have time on their hands might look at two or three and figure they have seen it all and didn’t learn anything they didn’t know already. I’m here to tell you that if you keep hunting, you might find some gems. But better than that, I will share what I have found in the event you don’t have the time or inclination to look at another twenty or thirty tip sheets.
CTA on Pause! What Tax Pros Need to Know About the Nationwide Injunction and BOI Reporting
On December 3, 2024, a U.S. District Court judge issued a nationwide preliminary injunction prohibiting FinCEN from enforcing the Corporate Transparency Act (CTA) and its associated Reporting Rule. This injunction halts the January 1, 2025, deadline for Beneficial Ownership Information (BOI) reporting, leaving many tax professionals and business entities questioning their compliance obligations. However, this pause is temporary. The government has already filed an appeal, and the injunction could be modified or overturned at any time. FinCEN has acknowledged that reporting companies are not currently required to file BOI reports but may do so voluntarily.
How to Help Your Clients Lower Their Student Loan Payments
There are roughly 42.7 million federal student loan borrowers as of Q4 2024, creating an opportunity to provide additional insight to your clients beyond tax preparation. By leveraging certain tax and repayment strategies, you can help your clients reduce their tax liability and lower their student loan payments in one strategic swoop. Here’s how.
SIMPLIFIED TAX STRATEGIES &
PRACTICAL IMPLEMENTATION
Think Outside the Tax Box provides tax reduction strategies along with practical
implementation advice in order to reduce your clients’ federal tax bill with ease.
