Theresa Arndt, CPA

One of the fun parts about my job is finding cool tax deductions or credits that people don’t know about but can be a real tax saver.  The one I want to talk about today is called the “Missouri Income Tax Deduction for New Workers”. Notice this is a “state” tax deduction.  The thing about state deductions is that most of them won’t just pop up on your tax software.  You have to actually know about them and specifically request the forms to come up.   How sneaky is that. Here’s how it works: If you are a small business you may qualify to claim a special state tax deduction for each new job you create in 2013 and 2014. Eligible Small Business : Employ fewer than 50 full-time and part-time employees at all times during the tax year for which the deduction is taken. Eligible Employee: Completed at least 52 consecutive weeks of full-time employment (average 35-hours/week). Earned wages for the 52 week period abov...

The IRS issued  Notice 2015-17 clarifying the application of Notice 2013-54 to certain situations. The notice provides relief for employers who are not applicable large employers (ALES), as defined in §4980H. In summary, the IRS will not assess any penalties for reimbursement arrangements for 2014 through June 30, 2015. After June 30, 2015, the IRS states they may start assessing penalties. Specifically, the IRS addresses: The transitional relief through June 30, 2015. The treatment to 2% S corporation shareholders. Reimbursing for Medicare, TRICARE or Medigap. Increasing employee compensation on an after-tax basis in a way that is not tied to health insurance. Treating insurance reimbursements as taxable wages. The IRS confirmed that for the time being, they'll allow an S corporation shareholder to deduct reimbursed insurance as a self-employed health insurance under §162 (l).  The IRS has also clarified that treating insurance rei...