Field of Study:
Americans who want to be their own boss are not entirely on their own. They have a rich uncle - Uncle Sam - who
is there to help, as well as to make demands. The nation's tax laws are intended to encourage people to start
new businesses and are chock full of incentives and tax breaks, as well as sometimes onerous re-porting
requirements.This course is a fast-paced and entertaining guide through tax issues affecting business entities
and their owners. The focus of this class is on tax devices and techniques available to the small-business owner.
Emphasis will be given to operational deductions, fringe benefits, compensation, family income splitting,
retirement plans, and estate planning.
After completing this course you will be able to:
- Recognize sole proprietorships, partnerships, and corporations as organizational formats for new and existing businesses.
- Identify how choice of entity relates to the type of records to keep, not-ing issues related to substantiation and documentation.
- Specify available accounting periods and methods and the methods for identifying and valuing inventory items.
- Identify the various types of income and their implications, including the hidden income tax dangers of cancellation of indebtedness income, tax recoveries, and recapture of depreciation.
- Specify the existing basic business and investment tax credits, noting their tax requirements, and business asset types that affect the charac-ter of gain or loss, and recognize the tax treatment of the disposition of business assets, such as the availability of like-kind exchange treatment in the transfer of business assets and the tax treatment of Section 1231 assets.
- Recognize the central importance of §162 in deducting and substan-tiating business expenses and costs and specify the implications of the deduction timing and limits noting the reporting of deductions for not-for-profit activities.
- Identify conditional sales contracts, leveraged leases, and true leases, and determine how to qualify for rent expense deductions including through leasehold improvements.
- Specify the various forms of interest expense under §163(a) noting related reporting and filing issues, and identify the distinctions between deductible and nondeductible interest.
- Recognize deductions for real estate, state, and local taxes and cite deductions for home office use, research and experimentation costs, barrier removal, and mine development.
- Identify the various forms of tax treatment under the concepts of depreciation and amortization, including the effect on amortization of §197.
- Determine the differences between the concepts of cost depletion and percentage depletion as a means of accounting for the reduction of a product’s reserves.
- Specify the types of bad debt and their effect on accounting and the various methods for dealing with bad debt.
- Recall MACRS classifications, cite the recapture provisions and ex-ceptions, and identify the alternative depreciation system.
- Specify the common-law rules used by the IRS to determine whether a person is an employee for purposes of FICA, FUTA and federal in-come tax withholding.
- Identify the tests for wages to be deductible and how excluded fringe benefits can result in more employer deductions and incentive based compensation to employees.
- Recognize the use of deferred compensation agreements including the basic types of nonqualified deferred compensation, and the tax consequences related to these plans.
- Identify the apportionment of business and personal use of an au-tomobile, including deduction limitations, and specify the various de-preciation methods such as MACRS and §179 expensing.
- Recognize personal auto leasing, its advantages and disadvantages, and the various kinds of leasing arrangements that can be used, such as closed-end or open-end leases.
- Recall the standard mileage method noting its limitations and identify the various working condition fringe benefits including their impact on the gross income of employees.
- Identify the various valuation methods use in determining the actual value of an employee’s personal use of an automobile noting the re-porting options available to the employer.
- Identify deductible business travel expenses.
- Determine the factors associated with the business purpose re-quirement noting how they determine deductible expenses for meals and entertainment.
- Identify the applicable federal per diem rate from any one of several methods and the different reporting and income inclusion treatments given to self-employed persons or reimbursed employees.
- Recognize the requirements and characteristics of qualified retirement plans.
- Determine the differences between defined contribution and defined benefit plans noting the different types of plans and their effect on retirement benefits.
- Identify Keogh Plans, traditional and Roth IRAs, and SIMPLE 401(k) plans by specifying their characteristics and determining how and when they may and may not be appropriate.
- Recognize the benefits of company-provided insurance policies by identifying how to qualify for group term life insurance and citing the requirements of retired lives reserve funds and split-life insurance poli-cies.
- Specify the requirements that determine insurance premium deduc-tions and, identify the interest disallowance rule, the uniform capitali-zation rules noting their relation to production or resale activity costs.
- Recognize the elements of general estate planning such as the un-limited marital deduction, including the qualified terminable interest property trust, stepped-up basis, and modified carryover basis rules.
- Identify the primary dispositive plans, such as simple wills, the various types of trusts, annuities, related family documents, and conserva-torships.
- Specify the various special business issues related to estate planning, such as methods of business valuation, the implications of important revenue rulings, the use of estate planning tools noting buy-sell agree-ments and, deferred compensation agreements.
General understanding of federal income taxation.
Type of Delivery Method:
Recommended CPE Credits:
Final examination expiration date:
The program participant will have one year from the date of purchase to complete the course and the final examination.
Web CPE is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.NASBARegistry.org.