PUBLIC SAFETY HEROES LAW PASSED

A new law, the "Don't Tax Our Fallen Public Safety Heroes Act," was signed on May 22, 2015, to clarify the tax treatment of federal and state benefits for public safety officers killed or injured in the line of duty. Under the law, such benefits will not be subject to federal income tax.

BUSINESS SURVEY IDENTIFIES TAXES AS BIGGEST BURDEN

In a survey of small businesses conducted by the National Small Business Association, 59% of respondents said taxes were more of an administrative burden than a financial one. Most businesses put payroll taxes at the top of the list of taxes with the greatest administrative burden. Payroll taxes also outranked other taxes, such as income, property, and sales taxes, as the top financial burden to businesses.

SUPREME COURT RULES ON ACA SUBSIDIES

On June 25 the Supreme Court issued its ruling in the King v. Burwell case, holding that federal subsidies for health insurance could be provided whether the insurance was purchased through a state exchange or a federal exchange.  Challengers to the ACA subsidies maintained that the law’s language allowed for subsidies only when insurance was purchased through a state exchange and not through a federal exchange.  34 states had not set up an exchange, relying instead on the federal exchange. Subsidies offset the cost of health insurance for low and moderate income people who aren’t covered by an employer’s plan, Medicaid, or Medicare.

FIVE THINGS EVERY BUSINESS OWNER MUST DO

If you own or manage your own business, you're probably busy monitoring operations and dealing with everyday problems. But there are a few things that you should make time to do every year.

SHOULD YOU PAY MORE ATTENTION TO CASH FLOW IN YOUR BUSINESS?

In assessing their business, most owners focus on growth in sales and profits. Yet these do not guarantee business health and success. Another important gauge is cash flow.

BUSINESS TAX TIP: CALCULATE YOUR BASIS

It's important for S corporation shareholders to know their basis in the corporation. Basis is the key to determining whether current-year losses can be deducted by the shareholder or not. Losses in excess of basis are generally "suspended" for use in later years when the business has income. Basis is also important when shareholders plan to take nontaxable distributions. In cases where distributions exceed investment in the company, the distributions can be taxed as capital gain. Check your basis now to give yourself time to increase basis if necessary and avoid a tax surprise at year-end.

IRS ANNOUNCES 2016 HSA LIMITS

The 2016 inflation-adjusted amounts for health savings accounts (HSAs) have been released by the IRS. Individuals will be allowed to contribute up to $3,350, and contributions for family coverage will be limited to $6,750. As before, an individual aged 55 or older may contribute an additional $1,000. For 2016, a "high-deductible health plan" is one with an annual deductible of not less than $1,300 for individual coverage and $2,600 for family coverage.