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Cryptocurrency has gone mainstream, and if you’ve been sitting on the fence about accepting donations in virtual currency, it’s time to make a decision. But before your not-for-profit says “yes” to a Bitcoin (or other cryptocurrency) gift, make sure you understand the issues involved — including the risks.

Virtual currency = risk

Cryptocurrency refers to a decentralized form of digital currency that’s tracked in a blockchain ledger. Unlike traditional currencies, the ledger doesn’t reside with a central authority, such as a bank or government, but across public peer-to-peer networks. The value of cryptocurrencies derives in part from its scarcity. In the case of Bitcoins, for example, the supply is limited to 21 million “coins.”…
Continue Reading Cryptocurrency donations: Will your nonprofit accept them?

The American Rescue Plan Act, signed into law on March 11, 2021, provides a variety of tax and financial relief to help mitigate the effects of the COVID-19 pandemic. Among the many initiatives are direct payments that will be made to eligible individuals. And parents under certain income thresholds will also receive additional payments in the coming months through a greatly revised Child Tax Credit.

hundred dollar bills underneath a health mask; image used for blog post about direct payments from American Rescue Plan Act of 2021

Here are some answers to questions about these payments.

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Continue Reading The Child Tax Credit Under American Rescue Plan Act

Many people are more concerned about their 2020 tax bills right now than they are about their 2021 tax situation. That’s understandable because your 2020 individual tax return is due to be filed in less than three months (unless you file an extension).

two men sitting next to each other looking at documents with laptops; image used for blog post about 2021 tax situations

However, it’s a good idea to acquaint yourself with tax amounts that may have changed for 2021. Below are some Q&As about tax amounts for this year.

Be aware that not all tax figures are adjusted annually for inflation and even if they are, they may be unchanged or change only slightly due to low inflation. In addition, some amounts only change with new legislation.

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Continue Reading Have Questions About Your 2021 Tax Situation?

If you’re getting close to retirement, you may wonder: Are my Social Security benefits going to be taxed? And if so, how much will you have to pay?

a phone calculator sitting on top of a red journal and white and grey folder; image used for blog post about paying tax on social security benefits

It depends on your other income. If you’re taxed, between 50% and 85% of your benefits could be taxed. (This doesn’t mean you pay 85% of your benefits back to the government in taxes. It merely that you’d include 85% of them in your income subject to your regular tax rates.)

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Continue Reading Paying Tax on Your Social Security Benefits

While you probably don’t have any problems paying your tax bills, you may wonder: What happens in the event you (or someone you know) can’t pay taxes on time?

woman holding hundred dollar bills fanned out; image used for blog post about options if individuals can't pay taxes on time

Most importantly, don’t let the inability to pay your tax liability in full keep you from filing a tax return properly and on time. In addition, taking certain steps can keep the IRS from instituting punitive collection processes.

Here’s a look at the options.

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Continue Reading Can’t Pay Individual Taxes? Here’s What to Know

Today many employees receive stock-based compensation from their employer as part of their compensation and benefits package. The tax consequences of such compensation can be complex — subject to ordinary-income, capital gains, employment and other taxes. But if you receive restricted stock awards, you might have a tax-saving opportunity in the form of the Section…

Jen:  This is the PKF Texas Entrepreneur’s Playbook.  I’m Jen Lemanski, this week’s host, and I’m here today with Danielle Supkis Cheek, a director on our Entrepreneurial Advisory Services Team.  Welcome back to the Playbook, Danielle.

Danielle:  Thank you.

Jen:  So our Entrepreneurial Advisory Services Team tends to work with startups quite a bit, and I know you’ve got a lot of – your background is in the startup space – what’s your advice for them to get their accounting started off [on] the right foot for bankers, financials, all that kind of stuff?

Danielle:  That’s a big area.

Jen:  It is.

Danielle:  For either pre-revenues or startup companies and those with not a lot of operation experience, it can be a really overwhelming task in the first place.  Usually you need to start with some kind of model, because you don’t actually have any revenues or any transactions to actually account for, and then it all the way moves to once they start having transactions and the accounting.  So in the more pre-idea stage on that modeling aspect my biggest piece of advice is really to think through every single step of your day, and make sure every single step of that day – once you’re in your future operations – is accounted for somehow in your model.  So if you’re showing up to an office, there should be rent on your books somewhere or in your model.

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Continue Reading Tax and Accounting Tips for Startups

If your business has made repairs to tangible property, such as buildings, machinery, equipment and vehicles, you may be eligible for a deduction on your 2014 income tax return. But you must make sure they were truly “repairs,” and not actually “improvements.”

Why? Costs incurred to improve tangible property must be depreciated over a period…

If you’ve cashed in some big gains this year, consider looking for unrealized losses in your portfolio and selling those investments before year end to offset your gains. This can reduce your 2014 tax liability.

But if you want to minimize the impact on your asset allocation, keep in mind the wash sale rule. It…