Supporting compensation allocations in personal service corporations

Article Abstract:

Personal service corporations can avoid IRS scrutiny by maintaining minimal amounts of capital or allocating a portion of earnings as dividends to the capital it is holding. Personal service corporations typically use their earnings to compensate shareholders that have contributed services and tend to avoid paying dividends because they are subject to double taxation. The IRS is going to question significant capital reserves, the presence of non-shareholder professionals and allocations of profits that are not made based on a pre-existing formula.

Professional Services NEC, Other Services (except Public Administration), Taxation, Expense deductions, Professional services, Allocation (Taxation), Tax allocation, Professional corporations

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Do you need to understand the child tax credit?

Article Abstract:

Understanding the principles and rules underlying the child tax credit is advisable for practitioners and their clients even though tax preparation software will make this complex credit appear relatively simple. Useful knowledge to attain includes details of the complex interaction with other credits and credit limitations, such as the earned income credit, the alternative minimum tax, and the social security tax.

Public Finance Activities, Personal Income Tax Administratn, Evaluation, Tax law, Tax administration, Personal income tax, Tax credits

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End of year planning for 1999

Article Abstract:

The author discusses tax planning for 2000 which should begin at the end of 1999. Major legislative change in 2000 is unlikely and planning may focus on existing tax treatment in areas including Roth IRAs, state education savings programs, the home office deduction, capital gains, the child tax credit, and changes in eligibility for tax deductions or credits.

United States, Tax Management, Tax accounting, Tax planning, 1999 AD

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