No one needs to remind business owners that the cost of employee health care benefits keeps going up. One way to provide some of these benefits is through an employer-sponsored Health Savings Account (HSA). For eligible individuals, HSAs offer a tax-advantaged way to set aside funds (or have their employers do so) to meet future medical needs. To be eligible, an individual must be covered by a “high deductible health […]
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The Social Security Administration recently announced that the wage base for computing Social Security tax will increase to $160,200 for 2023 (up from $147,000 for 2022). Wages and self-employment income above this threshold aren’t subject to Social Security tax. The Federal Insurance Contributions Act imposes two taxes on employers, employees and self-employed workers. One is for Social Security tax, and the other for Medicare tax. There’s a maximum amount of […]
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You and your small business are likely to incur a variety of local transportation costs each year. Commuting costs aren’t deductible but the cost of any local trips you take for business purposes is a deductible business expense. Your deduction can be computed using actual expenses or a standard mileage rate (58.5¢ per business mile driven between Jan. 1 and June 30, 2022, and 62.5¢ per business mile driven between […]
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If you have a child or grandchild who’s heading to college in the future, you may wonder about investing in a qualified tuition program or 529 plan. You don’t get a federal tax deduction for a contribution, but the earnings aren’t taxed while the funds are in the program. (There may be a state deduction in your state.) You can change the beneficiary without income tax consequences. Distributions are tax-free […]
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It’s time to think about steps to lower your tax bill for this year and next. If you itemize deductions, you may be able to deduct medical expenses, state and local taxes up to $10,000, charitable donations and eligible mortgage interest. But these deductions won’t save taxes unless they’re more than your standard deduction ($25,900 for joint filers, $12,950 for singles and $19,400 for heads of household). You may be […]
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