When Is the Right Time to Start an S Corporation (S Corp)?

An S Corporation, or S Corp, is a unique legal structure for businesses in the United States. It combines the limited liability protection of a corporation with the tax advantages of a partnership or sole proprietorship. In an S Corp, business income and losses “pass through” to the shareholders’ personal tax returns, which means that…

The EIN, or Employer Identification Number, serves as a crucial identifier for businesses, similar to an individual’s social security number. Comprising nine unique digits, the EIN is assigned by the IRS, playing a pivotal role in various financial transactions and interactions with the government. More than a mere numerical code, the EIN is your business’s…

Understanding when you can claim a meal as a deductible expense is vital for businesses, particularly when entertaining clients, traveling, or conducting business meetings. In general, meals that are directly related to your business, have a clear business purpose, and are not considered lavish or extravagant can be claimed as a deduction. These may include…

Business expenses can be categorized into several general categories to track and manage financial transactions effectively. These categories are essential for budgeting, financial reporting, and tax planning. Here are the main expense categories: Operating Expenses: These include day-to-day costs such as rent, utilities, office supplies, and salaries. Cost of Goods Sold (COGS): Expenses directly associated…

The business gift rule, which limits the tax deduction for business gifts to $25 or less per recipient per year, is a crucial consideration for businesses looking to maintain tax compliance. This rule applies to gifts given to clients, employees, or other business associates. To maximize the tax benefits, businesses can choose thoughtful, lower-cost gifts…

The distinction in cost between CPAs and bookkeepers is rooted in the disparity of expertise and scope of services. While bookkeepers play a crucial role in managing day-to-day financial tasks, CPAs bring a higher level of skill and insight to the table. CPAs undergo extensive education, pass a challenging exam, and adhere to strict professional…