2023 - Linkenheimer LLP CPAs & Advisors

Important Reminder on Mandatory e-Pay and S-Corporation Pass-Through Entity Tax

We hope this message finds you well. As we navigate through the financial year, we would like to draw your attention to some significant updates from the California Franchise Tax Board (FTB) that might impact your business operations.

Firstly, based on the guidelines detailed on ftb.ca.gov, it is crucial to note that businesses are required to enroll in the Mandatory e-Pay program once they make an estimate or extension payment exceeding $20,000 or when they file an original tax return with a total tax liability exceeding $80,000. Once you meet this threshold, all future payments, regardless of the amount, duration, or taxable year, must be made electronically. Failure to comply can result in a 1% noncompliance penalty on the amount paid.

Moreover, as highlighted in the FTB Tax News from May 2022, the FTB reminds taxpayers that, beginning from the tax year 2021, payments made for the S-Corporation Pass-through Entity Elective Tax will count toward the Mandatory e-Pay requirement. Hence, if your payment for the S-Corporation Pass-through Entity Elective Tax causes you to meet the threshold, you must enroll in the Mandatory e-Pay program and make all future S-corporation payments electronically.

We understand […]

By Linkenheimer LLP|2023-10-09T16:47:51+00:00October 9th, 2023|pte|0 Comments

2023 Q2 Tax Calendar: Key Deadlines for Businesses and Employers

Here are some of the key tax-related deadlines that apply to businesses and other employers during the second quarter of 2023. Keep in mind that this list isn’t all-inclusive, so there may be additional deadlines that apply to you. Contact your Linkenheimer CPA to ensure you’re meeting all applicable deadlines and to learn more about the filing requirements.

April 18

If you’re a calendar-year corporation, file a 2022 income tax return (Form 1120) or file for an automatic six-month extension (Form 7004) and pay any tax due.
For corporations pay the first installment of 2023 estimated income taxes.
For individuals, file a 2022 income tax return (Form 1040 or Form 1040-SR) or file for an automatic six-month extension (Form 4868) and pay any tax due.
For individuals, pay the first installment of 2023 estimated taxes, if you don’t pay income tax through withholding (Form 1040-ES).

May 1

Employers report income tax withholding and FICA taxes for the first quarter of 2023 (Form 941) and pay any tax due.

May 10

Employers report income tax withholding and FICA taxes for the first quarter of 2023 (Form 941), if they deposited on time and fully paid all […]

By Linkenheimer LLP|2023-03-20T15:29:10+00:00March 20th, 2023|tax deadlines|0 Comments

There Still May Be Time To Make An IRA Contribution For Last Year

If you’re getting ready to file your 2022 tax return, and your tax bill is higher than you’d like, there may still be an opportunity to lower it. If you’re eligible, you can make a deductible contribution to a traditional IRA right up until this year’s April 18 filing deadline and benefit from the tax savings on your 2022 return.

Rules for eligibility

You can make a deductible contribution to a traditional IRA if:

You (and your spouse) aren’t an active participant in an employer-sponsored retirement plan, or
You (or your spouse) are an active participant in an employer plan, but your modified adjusted gross income (MAGI) doesn’t exceed certain levels that vary from year-to-year by filing status.

For 2022, if you’re a married joint tax return filer and you are covered by an employer plan, your deductible IRA contribution phases out over $109,000 to $129,000 of MAGI. If you’re single or a head of household, the phaseout range is $68,000 to $78,000 for 2022. For married filing separately, the phaseout range is $0 to $10,000. For 2022, if you’re not an active participant in an employer-sponsored retirement plan, but your spouse is, your deductible […]

By Linkenheimer LLP|2023-02-21T15:53:28+00:00February 21st, 2023|contributions, ira|0 Comments

Many Tax Limits Affecting Businesses Have Increased For 2023

An array of tax-related limits that affect businesses are indexed annually, and due to high inflation, many have increased more than usual for 2023. Here are some that may be important to you and your business.

Social Security tax

The amount of employees’ earnings that are subject to Social Security tax is capped for 2023 at $160,200 (up from $147,000 for 2022).

Deductions

Section 179 expensing:
- Limit: $1.16 million (up from $1.08 million)
- Phaseout: $2.89 million (up from $2.7 million)
Income-based phase-out for certain limits on the Sec. 199A qualified business income deduction begins at:
- Married filing jointly: $364,200 (up from $340,100)
- Other filers: $182,100 (up from $170,050)

Retirement plans

Employee contributions to 401(k) plans: $22,500 (up from $20,500)
Catch-up contributions to 401(k) plans: $7,500 (up from $6,500)
Employee contributions to SIMPLEs: $15,500 (up from $14,000)
Catch-up contributions to SIMPLEs: $3,500 (up from $3,000)
Combined employer/employee contributions to defined contribution plans (not including catch-ups): $66,000 (up from $61,000)
Maximum compensation used to determine contributions: $330,000 (up from $305,000)
Annual benefit for defined benefit plans: $265,000 (up from $245,000)
Compensation defining a highly compensated employee: $150,000 (up from $135,000)
Compensation defining a “key” employee: $215,000 (up from […]

By Linkenheimer LLP|2023-02-07T19:16:44+00:00February 7th, 2023|business, tax implications|0 Comments

California Conforms To IRS Filing Extensions For California Storm Victims

The Governor’s office has announced that California will conform to the filing extensions granted by the IRS for California storm victims. This means the FTB has extended filing and payment deadlines for many individuals and businesses in California until May 15, 2023.

This relief applies to the following deadlines falling on or after January 8, 2023, and before May 15, 2023:

Individual income tax returns;
Business return filings normally due between March 15 and April 18, 2023;
Fourth and first quarter estimated tax payments due on January 17, 2023, and April 18, 2023. Individual taxpayers can skip making the fourth quarter estimated tax payment and instead include it with the 2022 return as long as the return is filed on or before May 15, 2023;
IRA and health savings account (HSA) contributions; and
Quarterly payroll and excise tax returns, normally due on January 31, 2023, and April 30, 2023.

Below is the complete press release from the Governor’s office:

SACRAMENTO – Californians impacted by winter storms are now eligible to claim a deduction for a disaster loss and will have more time to file their taxes.

“Whether it’s more time to file your taxes or getting a deduction, this […]

By Linkenheimer LLP|2023-01-16T18:32:49+00:00January 16th, 2023|ca, CA tax, california, disaster, ftb, irs, tax deadlines|0 Comments