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July 2014 Archives

Must You Treat Crowdfunding Money as Taxable Income?

The Internet has allowed businesses to expand in ways that were not previously possible. In fact, the Internet has allowed businesses to form in ways that were not previously possible. In the past, if an individual or individuals wanted to start a business, startup money had to be found by individual means, by loan or by soliciting funds from investors, family members or other businesses through face-to-face interactions, letter campaigns or telephone calls. The Internet has seemingly changed forever the ways in which businesses can obtain startup and expansion money through its unique capacity for crowdfunding.

"Possible Measures Against Expatriation for Tax Purposes"

In recent years, Senate Democrats have proposed legislation, originally titled the Expatriation Prevention by Abolishing Tax-Related Incentives for Offshore Tenancy, i.e., the Ex-PATRIOT Act that would impose a capital gains tax on U.S. investments for those who renounce their citizenship to avoid taxes and bar the ex-pats from returning to the U.S. If passed, the IRS would presume that those with either a net worth of $2 million or an average income liability of at least $148,000 over the last five years who renounce their citizenship are doing so to avoid taxes. Ex-pats who meet specified requirements would have an opportunity to prove otherwise to the IRS. If the motives were found to be legitimate, no penalties would be applied. On the other hand, if the IRS rules that an individual gave up their passport for tax purposes, he or she could then face taxes of 30% on future investment gains, regardless of where they reside. Further, so long as the ex-pats avoid their tax responsibilities, they would not be allowed to return to the U.S. As these measures have not passed so far, under the current system, ex-pats have been able to avoid being liable for such taxes and still return to the U.S. for 60 days per year. However, should a new version of the Ex-PATRIOT Act pass, these new measures could close the loophole and the door.

Can You Deduct Work Uniforms From Your Business Taxes?

If you own a small business, you may provide uniforms for your employees. You may even wear one yourself. These uniforms may be integral to the operation of your business or they may simply enhance your customers' experience and your employees' sense of cohesion and focus. Whatever the purpose of your work uniforms is, you likely view them as a business expense. But just because you view them as a business expense does not necessarily mean that you may deduct their cost from your business taxes.

Troubles With The IRS Can Sometimes Lead to Criminal Proceedings

Running into tax troubles with the Internal Revenue Service is an incredibly serious situation to be in. A person in such a situation can not only face tax penalties, but also, in some circumstances, may end up having criminal proceedings initiated against them.

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