Blog Archives

Employee Bonuses and Gifts

You can deduct the cost of tangible gifts you give to employees as long as the value does not exceed $25 per year per employee. They qualify as business expenses, and the gifts are not taxable to the employees or

Posted in Deductions

Worker Classification

While the definition of employment in Colorado law is broad and inclusive, it is not the same as the Internal Revenue Service. According to Colorado law, the two main concepts used to determine the status of a worker and whether

Posted in Colorado

Can I pay someone as both an employee and as an independent contractor?

The official IRS position is that “facts and circumstances” always dictate how a worker is “classified” for employee (W-2) or independent contractor (1099) purposes. A person can be both an employee and an independent contractor if their “sideline services” are

Posted in Tips

Are Tips and Gratuities Subject to Sales Tax in Colorado?

Tips and gratuities are payments that are separately paid to someone providing a service. NOT TAXABLE Tips and gratuities are NOT subject to sales tax when they are left on the table or location where the service took place or

Posted in Colorado

Worst Part of Owning a Business

“40% of small business owners say bookkeeping and taxes are the single worst part of owning a business.”  Source: 2014 survey from SCORE, a small business mentoring organization

Posted in Quotes

Can I claim the home office deduction if I don’t own my home and pay rent?

You can claim the home office deduction whether you rent or own your home. There are two options.  You can use a simplified option which is the square footage of the office times $5.  If you use the regular method,

Posted in Deductions, IRS

Home Office Deductions

The home office deduction is a great benefit for home-based businesses.  In 2013, more than 3.4 million taxpayers claimed deductions for the business use of a home. In order to claim the deduction, the IRS requires that the home office

Posted in Deductions, IRS

Records Retention for Businesses

We are often asked, “How long do I have to keep this stuff?” Whether personal or business, the minimum is 3 years to retain records since the IRS generally has 3 years to audit you from the date you file

Posted in Tips

Profit Motive

The law says that a business loss can produce a tax write-off as long as the owner is honestly trying to make a profit.  The Tax Code provides a test for profit motive:  If a venture doesn’t make money in

Posted in Profit

Corresponding with the IRS

Whenever writing the IRS, always make several copies of whatever you send.  If the IRS misplaces your first correspondence, you can send it again – and again, if necessary.

Posted in IRS