DEPRECIATION MEANINGDepreciation is an annual income tax deduction that allows you to recover the cost or other basis of certain property over the time you use the property. It is an allowance for the wear and tear, deterioration, or obsolescence
Activities that can establish sales tax nexus in a state There are several ways a business can establish sales tax nexus, or an obligation to collect Sales tax, including: Economic nexus Economic nexus is established when an out-of-state company’s sales
Nexus Nexus, a connection between a business and the state, must exist for a state to impose an income tax. States establish the rules to use when determining how much in-state activity creates a nexus by a business. Often, this
When a corporation liquidates, the value of the assets it holds as of the date of liquidation is included in its taxable income for that year. The US shareholders then include the value of cash and other assets they receive
Dividends are payments made by a corporation to its shareholders from current or accumulated earnings. Dividends can be paid in cash, any other assets, and even in the company’s stock. The corporation does not get a tax deduction for these
Meals during travel will be reimbursed as travel expenses based either on per diem allowance rates or actual amounts expensed (see Travel Expenses section for the rules on per diem allowance reimbursements). Business meals and entertainment are only reimbursable if
A. Employee Benefits Employee benefits are non-wage compensation provided to employees in addition to their regular salaries or wages. These can include a wide range of benefits such as health insurance, retirement plans, paid time off, disability insurance, and more.
In addition to cash payments, many of those who work for a technology start-up company receive some form of equity-linked compensation that often has an earnings potential much larger than the actual compensation received. Restricted Stock. As described above, it is
Starting on January 1st, 2022 R&E expenses are not currently deductible. They need to be capitalized and amortized over 5 and 15 years if research is done inside or outside the US respectively. R&E expenditures are research and development costs
There are two main ways to pay service providers in the US: as employees and as independent contractors. The employees receive wages subject to payroll taxes. Employer’s expense on top of the wages is roughly 8% and employee’s share of