ONealCPA GROUP

ASK MICKEY CPA, CVA QUESTION: How can I expense a business-related vacation? ANSWER: To expense a business-related vacation, you need to make sure the trip has a primary business purpose & carefully document the expenses. Here’s a breakdown of how to expense it legitimately: 1. Define the Business Purpose: The IRS allows deductions for travel primarily for business. Make sure there’s a valid, documented business reason, like a meeting with clients, attending a conference, or scouting new opportunities. 2. Document the Trip: Keep a record of the dates, itinerary, and agenda of business activities. Collect documentation for business meetings or events, like conference tickets or an invitation from a client. Maintain detailed notes of meetings, including the topics discussed and the business objectives. 3. Separate Personal & Business Expenses: Only expenses for business activities are deductible. This includes travel, lodging, meals (at 50%), and other business-related costs for the business days of your trip. Any personal activities (such as sightseeing) should not be included in your deductions, nor should any additional days purely for personal leisure. 4. Travel Days: Travel expenses are deductible if the trip is primarily for business, even if you add some personal days. For instance, if you attend a three-day conference but stay for a seven-day vacation, expenses related to travel and the business days are deductible, while personal days are not. 5. Keep Receipts: Collect receipts for everything, including airfare, hotel stays, meals, and transportation. Ideally, use a business credit card for all business-related expenses to simplify record-keeping. 6. Per Diem Allowances: You may use the per diem method (a daily rate for lodging, meals, and incidental expenses) if it simplifies your accounting. Per diem rates are set by the IRS and depend on the destination. Thomas M. "Mickey" O'Neal, CPA Natalie O'Neal Braeleigh Blakeney Seth Blakeney #businesstrip #taxdeduction #vacation #taxprepayer #accountant #taxfirm #tax #taxes #taxes2024 #taxexpenses

ASK NAT, TAX PROFESSIONAL QUESTION: Are there any tax breaks for new parents? ANSWER: Yes, there are several tax breaks available for new parents that can help reduce the financial burden of raising a child. Some of the key tax credits and deductions for new parents: 1. Child Tax Credit (CTC): You can claim up to $2,000 per child under the age of 17. Up to $1,500 of this credit is refundable, which means you can receive it as a refund even if you don’t owe any taxes. Income limits apply, with phaseouts starting at $200,000 for single filers and $400,000 for married couples filing jointly. 2. Child and Dependent Care Credit: This credit helps cover daycare costs, with a maximum of $3,000 in eligible expenses for one child and up to $6,000 for two or more children. The percentage of expenses you can claim depends on your income, with up to 35% eligible for the lowest-income earners. 3. Earned Income Tax Credit (EITC): For low- to moderate-income working parents, the EITC can provide a significant refund. The amount varies based on income and the number of qualifying children. 4. Adoption Tax Credit: If you've adopted a child, you may qualify for a tax credit of up to $15,950 in 2023 to help offset adoption-related expenses. 5. Dependent Care Flexible Spending Account (FSA): Some employers offer FSAs that allow you to set aside pre-tax dollars for childcare expenses, which can lower your taxable income. 6. Education Savings Accounts: While not immediately helpful for newborn expenses, opening a 529 or Coverdell Education Savings Account lets you set aside money for future education costs, with tax-free growth if used for qualified education expenses. 7. Medical Expense Deduction: If you have high medical expenses related to childbirth that exceed 7.5% of your adjusted gross income, you may be able to deduct a portion of those costs. *These tax benefits can make a big difference, especially with rising childcare costs. #childtaxcredit #CTC #CDCC #EITC #FSA #medicalexpense #taxdeductions #educationtaxdeductions #adoptiontaxcredit #educationsavingaccounts #tax #taxcredits #taxprepayer #taxfirm #taxprofessional Natalie O'Neal Thomas M. "Mickey" O'Neal, CPA Seth Blakeney Braeleigh Blakeney  

FUN TAX FACT FRIDAY... In 2005, the state of Tennessee introduced a "jelly bean tax." Candy-coated items like jelly beans were subject to sales tax, but if the candy coating was removed (like with chocolate bars or gummies), they were tax-exempt. This led to some confusion about which candies were taxed, making for a truly sticky tax situation! #taxes #tax #funtaxfact #taxexempt #taxaccountant #taxprepayer #cpa #cpafirm #taxfirm Thomas M. "Mickey" O'Neal, CPA Natalie O'Neal Seth Blakeney Braeleigh Blakeney

ASK MICKEY CPA, CVA QUESTION: Has the IRS adjusted tax amounts for inflation for 2025? ANSWER: Yes, the IRS has released inflation adjustments for the 2025 tax year. Key changes include adjustments to tax brackets, standard deductions, and other tax-related provisions: 1. Tax Brackets: The seven federal income tax rates remain the same (10%, 12%, 22%, 24%, 32%, 35%, and 37%), but the income thresholds for these rates have been adjusted to account for inflation. For instance, the 10% bracket will now apply to income up to $11,925 for single filers (up from $11,600 in 2024) and $23,850 for married couples filing jointly. 2. Standard Deduction: The standard deduction has increased for 2025: Single filers & married individuals filing separately can claim $15,000 (up from $14,600). Heads of households can claim $22,500 (up from $21,650). Married couples filing jointly can claim $30,000 (up from $29,200). Earned Income Tax Credit (EITC): The maximum EITC for families with three or more qualifying children will rise to $8,046 in 2025, reflecting a slight increase from 2024. 3. Alternative Minimum Tax (AMT): The exemption amount for the AMT will also be adjusted, with married couples filing jointly seeing an increase to $137,000 & unmarried individuals having an exemption of $88,100. These adjustments aim to prevent "bracket creep," where taxpayers end up in higher tax brackets due to inflation, without a real increase in their purchasing power. The changes will apply to tax returns filed in 2026. #inflation #taxbrackets #taxes #taxes2024 #taxes2025 #taxprepayer #taxaccountant #accountant #economy #cpa #cpafirm Thomas M. "Mickey" O'Neal, CPA Braeleigh Blakeney Natalie O'Neal Seth Blakeney

Hi! Hope you're having a wonderful October! Please tell me what you would like to hear from us. Taxes, Economy, Small Business issues, or about our networking events! If you want to stay up-to-date with us, follow our Page. Thank you! Brenda Cheney

ASK NAT, Tax Professional Question: Are there any new changes to the Child Care Act? ANSWER: Recent changes to childcare policies under the 2024 Child Care and Development Fund (CCDF) Final Rule aim to enhance affordability, access, and stability for families: 1. Cost Reductions: The rule caps the amount families pay for child care to be no more than 7% of their household income. Additionally, states can waive co-payments for families earning below 150% of the poverty line and for those with children who have disabilities. This change is expected to benefit over 100,000 families by reducing child care expenses.   2. Improved Payment Practices: To better support child care providers, the rule mandates timely payments that more accurately reflect the cost of care. This helps stabilize operations and encourages more providers to participate in the CCDF, thus expanding options for parents. 3. Streamlined Access: Families who are eligible for other benefit programs can now find it easier to apply for child care assistance. Efforts to reduce paperwork and introduce more accessible online applications are part of this initiative, helping families secure child care without disrupting their employment or education. Natalie O'Neal Thomas M. "Mickey" O'Neal, CPA Seth Blakeney Braeleigh Blakeney #childcareact #childcare #taxcredit #taxdeduction #ccdf #childcarecreditdevelopmentfund #taxprepayer #taxaccountant #accountant #taxfirm #cpa #cpafirm

ASK MICKEY, CPA, CVA QUESTION: I'm starting my own business what are the biggest expenses? ANSWER: 1. Operational Expenses Rent or Lease: Costs of leasing office space, retail space, or equipment. Utilities: Electricity, water, internet, & phone services. Supplies: Office supplies, cleaning supplies, & other consumables. 2. Employee-Related Expenses Salaries and Wages: Payment to employees for their work. Payroll Taxes: Employer's share of Social Security, Medicare, & unemployment taxes. Employee Benefits: Health insurance, retirement contributions, & other perks. 3. Cost of Goods Sold (COGS) Raw Materials: Materials used to create products. Direct Labor: Labor costs directly tied to producing goods. Manufacturing Supplies: Tools, parts, & supplies used in production. 4. Professional Services Legal Fees: Costs for legal advice, contracts, & compliance. Accounting and Bookkeeping: Fees for managing finances and taxes. Consulting: Fees for hiring experts to advise on business strategies. 5. Marketing & Advertising Advertising: Online ads, print ads, billboards, etc. Promotional Materials: Brochures, business cards, & merchandise. Online Marketing: Website hosting, email marketing, & social media ads. 6. Technology & Software Software Subscriptions: CRM, project management, & accounting software. IT Services: Maintenance & technical support. Website Development: Design, development, & maintenance costs. 7. Travel and Entertainment Business Travel: Airfare, hotel stays, & car rentals for business trips. Meals and Entertainment: Client meetings, business lunches, & events. Mileage: Expenses for business use of personal vehicles. 8. Insurance General Liability Insurance: Protection against lawsuits or claims. Professional Liability Insurance: Coverage for errors or negligence. Workers' Compensation: Insurance for employee injuries on the job. 9. Loan & Interest Payments Interest on Loans: Payments for business loans or lines of credit. Credit Card Fees: Interest & transaction fees for business credit cards. 10. Depreciation & Amortization Depreciation: Allocation of the cost of physical assets over their useful life. Amortization: Gradual write-off of intangible assets. *These expenses can vary based on the industry, business size, & specific operations. #businessexpenses #smallbusiness #smallbusinessexpenses #expenses #operationalexpenses #taxfirm #taxprepayer #taxaccountant #accountant #cpa #cpafirm Thomas M. "Mickey" O'Neal, CPA Natalie O'Neal Seth Blakeney Braeleigh Blakeney

ASK MICKEY, CPA, CVA QUESTION: What are the main tax changes for 2024? ANSWER: For 2024, several changes to federal tax laws have been implemented, mainly due to annual inflation adjustments. Here are the key updates: 1. Income Tax Brackets: While the tax rates (10%, 12%, 22%, 24%, 32%, 35%, and 37%) remain unchanged, the income thresholds have been adjusted. For example, the 22% bracket now applies to individual incomes from $47,150 to $100,525 and joint filers from $94,300 to $201,050. These adjustments help prevent taxpayers from being pushed into higher tax brackets solely due to cost-of-living increases   2. Standard Deduction: The standard deduction has increased. For married couples filing jointly, it's now $29,200, up by $1,500 from 2023. Single filers can claim $14,600, and heads of households get $21,900, both with similar increments from last year 3. Retirement Contribution Limits: The maximum contribution limit for 401(k) plans has risen to $23,000, up from $22,500 in 2023. IRA contribution limits have also increased to $7,000 from $6,500 4. Gift Tax Exclusion: The annual gift tax exclusion amount has been raised to $18,000 for 2024, up from $17,000 . These adjustments aim to accommodate inflation, allowing more room for tax savings. Additionally, eligibility thresholds for certain tax credits and deductions, such as IRA contributions and the Saver's Credit, have also been adjusted upwards, which may benefit taxpayers across different income levels. #taxes2024 #taxes #tax #saverstaxcredit #gifttaxexclusion #standarddeduction #incometaxbrackets #taxchanges #taxaccountant #taxprepayer #taxaccountant #cpa #cpafirm #taxfirm Thomas M. "Mickey" O'Neal, CPA Natalie O'Neal Seth Blakeney Braeleigh Blakeney

FUN TAX FACT FRIDAY... The largest tax evasion case in the history of the U.S. is the 2006 case of Walter Anderson, a telecommunications executive. Other famous tax cheats include mobster Al Capone, Girls Gone Wild creator Joe Francis, Wesley Snipes, and hotel operator Leona Helmsley, who once quipped, “We don’t pay taxes, only the little people pay taxes." #taxes #tax #taxes2024 #taxfacts #taxprepayer #taxaccountant #cpafirm #taxfirm #acountant Thomas M. "Mickey" O'Neal, CPA Natalie O'Neal Seth Blakeney Braeleigh Blakeney

ASK NAT, Tax Professional Question: Are there any tax credits for single women? Answer: There are a variety of tax credits and deductions available that single women may be able to claim depending on their individual situation. Here are some key ones that might apply: 1. Earned Income Tax Credit (EITC) The EITC is a tax credit for low- to moderate-income individuals and families. If you're a single woman with or without children and your income falls within certain limits, you may be eligible for this credit. For 2024, you could qualify if your income is below $59,187 (the specific limit depends on the number of qualifying children). 2. Child Tax Credit (CTC) If you're a single mother, you can claim the Child Tax Credit for your dependent children. In 2024, the credit is worth up to $2,000 per qualifying child under the age of 17. 3. Child and Dependent Care Credit If you are paying for childcare or care for another dependent (like an elderly parent), this credit can help reduce your tax liability. You can claim up to 35% of qualifying expenses, with a maximum of $3,000 for one dependent or $6,000 for two or more. 4. Lifetime Learning Credit (LLC) If you're pursuing education to improve your job skills or career opportunities, the LLC can offer a credit of up to $2,000 for qualified tuition and related expenses. 5. American Opportunity Tax Credit (AOTC) This credit is available for the first four years of higher education. It allows you to claim up to $2,500 per year for tuition, fees, and course materials. 6. Saver’s Credit If you contribute to a retirement account, such as a 401(k) or an IRA, and your income is below a certain threshold, you may be able to claim the Saver’s Credit, which can be up to $1,000 (or $2,000 if you're contributing to a retirement plan). 7. Premium Tax Credit (PTC) If you are purchasing health insurance through the marketplace and your income falls within certain limits, you may qualify for the PTC, which helps offset the cost of premiums for health insurance. 8. Education Loan Interest Deduction If you're paying off student loans, you can deduct up to $2,500 in interest paid on your loans, which can reduce your taxable income. 9. Retirement Contributions Contributing to a traditional IRA or 401(k) can provide you with tax deductions that reduce your taxable income. 10. State-Specific Credits Depending on where you live, there may also be state-specific tax credits for single women or women in specific situations, such as low-income households or those paying for childcare. It’s always a good idea to consult with a tax professional or use tax preparation software to ensure you're taking advantage of all the credits and deductions you’re eligible for based on your individual circumstances. Natalie O'Neal Thomas M. "Mickey" O'Neal, CPA Seth Blakeney Braeleigh Blakeney #taxes #tax #taxcredit #taxes2024 #taxorepayer #taxaccountant #accountant #taxdeductions #taxdeduction #cpa #cpafrim #taxfirm