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Standard mileage rates will go down in 2016

Optional standard mileage rates for business use of a vehicle will go down beginning January 1st, 2016, the IRS announced on Thursday. For business use of a car, van, pickup truck, or panel truck, the rate for 2016 will be 54 cents per mile, compared with 57.5 cents in 2015. Taxpayers can use the optional standard mileage rates to calculate the deductible costs of operating an automobile.

STANDARD MILEAGE RATES

The standard mileage rate for transportation or travel expenses is 54 cents per mile for all miles of business use (business standard mileage rate).
The standard mileage rate is 14 cents per mile for use of an automobile in rendering gratuitous services to a charitable organization.
The standard mileage rate is 19 cents per mile for use of an automobile (1) for medical care described in § 213, or (2) as part of a move for which the expenses are deductible.

BASIS REDUCTION AMOUNT For automobiles a taxpayer uses for business purposes, the portion of the business standard mileage rate treated as depreciation is 23 cents per mile for 2012, 23 cents per mile for 2013, 22 cents per mile for 2014, 24 cents per mile for 2015, and 24 […]

By Linkenheimer LLP|2020-09-03T20:05:19+00:00December 18th, 2015|mileage|0 Comments

Employers Need to Understand Their Employment Tax Responsibilities

The IRS has issued a fact sheet to remind business owners how critical it is to understand the various types of employment-related taxes they may be required to deposit and report. This fact sheet provides information on some of the more common employment tax topics posed by business owners, including worker classification, Voluntary Classification Settlement Program (VCSP), fringe benefits, officer compensation, and backup withholding and information return penalties. The fact sheet is available at https://www.irs.gov/uac/Newsroom/General-Employment-Tax-Issues .

If you have any questions, please contact your Linkenheimer CPA at (707) 546-0272.

By Linkenheimer LLP|2020-09-03T20:05:20+00:00November 18th, 2015|business, employer, irs|0 Comments

“Heavy” Trucks and Vans Continue to Qualify for Fast Cost Recovery

Passenger autos used primarily for business (i.e., greater than 50 percent) are subject to significant federal depreciation limitations, e.g., $3,160 for passenger autos and $3,460 for light trucks or vans in the first year at 100 percent business use. However, the luxury auto depreciation limitations only apply to passenger autos. A truck or van escapes passenger auto status if its Gross Vehicle Weight Rating (GVWR-the manufacturer’s maximum weight rating when loaded to capacity) exceeds 6,000 pounds. A vehicle that is not classified as a passenger auto and used primarily for business is depreciated without limit under the MACRS rules. And, these vehicles also qualify for the Section 179 deduction. Under current 2015 tax law, you can expense a total of $25,000 for all eligible property placed in service in tax years beginning in 2015 using Section 179. However, Congress may extend the increased Section 179 ($500,000) and bonus depreciation (50 percent) that existed for 2014. It should be noted that qualified vehicles are likely subject to a $25,000 per vehicle limit for Section 179 expensing if Congress extends the increased deductions. And, you must have real-time records (such as a mileage log) that establish […]

By Linkenheimer LLP|2020-09-03T20:05:21+00:00November 5th, 2015|depreciation|0 Comments

Understanding Your Form 1095-B, Health Coverage

Form 1095-B, Health Coverage, is used to report certain information to the IRS and to taxpayers about individuals who are covered by minimum essential coverage and therefore aren’t liable for the individual shared responsibility payment.

Minimum essential coverage includes government-sponsored programs, eligible employer-sponsored plans, individual market plans, and other coverage the Department of Health and Human Services designates as minimum essential coverage.

By January 31, 2016, health coverage providers should furnish a copy of Form 1095-B, to you if you are identified as the “responsible individual” on the form.

The “responsible individual” is the person who, based on a relationship to the covered individuals, the primary name on the coverage, or some other circumstances, should receive the statement. Generally, the recipient should be the taxpayer who would be liable for the individual shared responsibility payment for the covered individuals. A recipient may be a parent if only minor children are covered individuals, a primary subscriber for insured coverage, an employee or former employee in the case of employer-sponsored coverage, a uniformed services sponsor for TRICARE, or another individual who should receive the statement. Health coverage providers may, but aren’t required to, furnish a […]

By Linkenheimer LLP|2020-09-03T20:05:22+00:00November 4th, 2015|Health care|0 Comments

Poor Recordkeeping Hurts Taxpayers: Problems and Prevention

Every year a few taxpayers go to court hoping for a better outcome than the one offered by the IRS. Usually, they lose due to poor records, not meeting all requirements for particular deductions, or inadequately separating business from personal expenditures. This article examines a few 2015 cases involving these issues and makes suggestions for practitioners to remind clients that they need timely records and should only report allowable deductions. – See more at: http://www.thetaxadviser.com/newsletters/2015/oct/poor-tax-recordkeeping-hurts-taxpayers.html#sthash.Do84PZol

By Linkenheimer LLP|2020-09-03T20:05:22+00:00November 3rd, 2015|irs|0 Comments