While many workers eagerly await a gift from their employers this quarter in the form of a bonus, businesses may shudder at the costs incurred, raising the question, “Are employee bonuses deductible?” Take heart, because in many cases, employee bonuses don’t just serve as an extra incentive for workers but they are generally tax-deductible for businesses that operate as corporations. Read on to learn about the allowances and limitations for the employee bonus deduction.
An employer identification number, or EIN, is a nine‐digit number the IRS assigns to businesses for tax filing and reporting purposes. An EIN must be used by business entities like corporations, partnerships, and limited liability companies. I often get asked by self-employed workers, “Does a sole proprietor need an EIN?”
From bar associations to chambers of commerce, there are countless professional organizations that entrepreneurs seek membership in for support and assistance in carrying out business activities. While vital to a business owner’s professional development, these memberships often come with costs in the form of dues to the respective organizations. This raises the question “Are business association membership dues deductible?” Learn about deducting business membership dues to offset membership costs in qualifying trade or professional associations.
With valuable write offs like the mileage deduction and home office deduction available, it’s not a surprise to see that over half of all taxpayers hire tax professionals to prepare their income tax returns. This week’s Tax Tip Tuesday is focused on helping you find a tax professional that fits your needs and, importantly, holds professional credentials recognized by the IRS or who holds an Annual Filing Season Program Record or Completion.