Are Your Social Security Benefits Taxable?

Some people must pay taxes on part of their Social Security benefits. Others find that their benefits aren’t taxable. If you get Social Security, we can help you determine if some – or all – of your benefits are taxable. Here are five tips about how Social Security affects your taxes:

1. If you receive these benefits in 2014, you should receive a Form SSA-1099, Social Security Benefit Statement, showing the amount.

2. If Social Security was your only source of income in 2014, your benefits may not be taxable. You also may not need to file a federal income tax return next spring. Read more

Tax Brackets, Deductions, and Exemptions for 2015

More than 40 tax provisions, including the tax rate schedules, and other tax changes are adjusted for inflation in 2015. Let’s take a look at the ones most likely to affect taxpayers like you.

The tax rate of 39.6 percent affects singles whose income exceeds $413,200 ($464,850 for married taxpayers filing a joint return), up from $406,750 and $457,600, respectively. The other marginal rates–10, 15, 25, 28, 33 and 35 percent–and the related income tax thresholds are described in the revenue procedure.

The standard deduction rises to $6,300 for singles and married persons filing separate returns and $12,600 for married couples filing jointly, up from $6,200 and $12,400, respectively, for tax year 2014. The standard deduction for heads of household rises to $9,250, up from $9,100. Read more

Small Business and the Affordable Care Act

Whether you’re self-employed or run a small business, here’s a quick look at what you need to know about the Affordable Care Act.

Self-Employed

If you run an income-generating business with no employees, then you’re considered self-employed. You can get coverage through the Healthcare Marketplace and use it to find coverage that fits your needs.

Note: You are still considered self-employed even if you hire independent contractors to do work for you.

If you currently have individual insurance–a plan you bought yourself and not the kind you get through an employer–you may be able to change to a Marketplace plan.

Note: You can’t be denied coverage or charged more because you have a pre-existing health condition.

Small Businesses (50 or Fewer Employees)

If you have 50 or fewer full-time equivalent (FTE) employees (generally, workers whose income you report on a W-2 at the end of the year) you are considered a small business under the health care law.

As a small business, you may get insurance for yourself and your employees through the SHOP (Small Business Health Options Programs) Marketplace. This applies to non-profit organizations as well.

Note: Beginning in 2016, the SHOP Marketplace will be open to employers with 100 or fewer FTEs.

As an employer, you must provide notification to your employees of coverage options available through the Marketplace and are required to provide this notice to all current employees and to each new employee regardless of plan enrollment status or full or part-time employment. The Department of Labor has sample notices that employers can use to comply with this regulation. One notice is for employers who do not offer a health care plan and the second for employers who offer a health care plan.

If you have fewer than 25 employees, you may qualify for the Small Business Tax Credit (see next section). Non-profit organizations may be eligible for the tax credit as well. Read more

Tax Changes for 2015: A Checklist

Individuals

For 2015, more than 40 tax provisions are affected by inflation adjustments, including personal exemptions, AMT exemption amounts, and foreign earned income exclusion, as well as most retirement contribution limits.

For 2015, the tax rate structure, which ranges from 10 to 39.6 percent, remains the same as in 2014, but tax-bracket thresholds increase for each filing status. Standard deductions and the personal exemption have also been adjusted upward to reflect inflation. For details see the article, “Tax Brackets, Deductions, and Exemptions for 2015,” below.

Alternative Minimum Tax (AMT)
Exemption amounts for the AMT, which was made permanent by the American Taxpayer Relief Act (ATRA) are indexed for inflation and allow the use of nonrefundable personal credits against the AMT. For 2015, the exemption amounts are $53,600 for individuals ($52,800 in 2014) and $83,400 for married couples filing jointly ($82,100 in 2014).

“Kiddie Tax” 
For taxable years beginning in 2015, the amount that can be used to reduce the net unearned income reported on the child’s return that is subject to the “kiddie tax,” is $1,050 (up from $1,000 in 2014). The same $1,050 amount is used to determine whether a parent may elect to include a child’s gross income in the parent’s gross income and to calculate the “kiddie tax”. For example, one of the requirements for the parental election is that a child’s gross income for 2015 must be more than $1,050 but less than $10,500. Read more

LMGW has promoted Katie, Payal and Vanessa to Manager

From Left to Right – Katie M. Vachon, CPA, Vanessa S. Mun, CPA and Payal U. Shah, CPA

LMGW is proud to announce the promotions of Katie M. Vachon, CPA, Payal U. Shah, CPA and Vanessa S. Mun, CPA to manager.

“It is my pleasure to announce the promotions of Katie, Payal and Vanessa to Manager. Each new Manager brings a unique perspective and skillset to the firm and we look forward to their continued contributions.” said Managing Partner Matthew Wheeler

Katie joined LMGW in 2010 as a staff accountant. Katie has served some of LMGW’s largest and most complex clients.  As a manager, Katie specializes in individual and business taxation. When Katie is not at LMGW, she enjoys cooking, reading, and anything and everything outdoors.  It is her and her husband’s mission to visit as many National Parks as possible.

Payal has nearly a decade of public accounting experience. In 2010, Payal  joined LMGW as a senior accountant. In the role of manager, Payal will serve closely held business providing tax, consulting and accounting services. While away from work, Payal enjoys spending time with her family and friends, cooking, and travelling.

Vanessa came to LMGW in 2013 from a public accounting firm in San Francisco. Vanessa has served as senior to audit and review clients in the for profit and nonprofit sectors. Vanessa has also worked with individuals and business on a variety of tax projects. In her role as manager, Vanessa will continue to split her time between attest and tax. Away from the office, Vanessa enjoys spending time with her family visiting local parks and museums, and trying new restaurants.

Congratulations to our new managers!