Small Business Tax Strategies

Q: My wife and I are getting divorced. I own mutual fund shares worth about $150,000, which are all in a taxable brokerage account in my name. If I transfer some of the shares to her as part of the divorce, do I have to pay tax on the gain over basis? A.R., Monsey, N.Y.

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Q: I was interested in your special report on business education. (7/11/05 issue) Both of my kids work for me as employees and also attend college. I found a course on family business dynamics at a different college that I’d like my kids to take. If I pay for the course, can I deduct the cost? A.C.

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Q: I have a carried-over capital loss of $6,500 from last year. Can I use this loss to offset some of my income from a required IRA distribution? S.B., Toms River, N.J.

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By disclaiming an inherited IRA, you can pass the account along to someone else, free of gift tax.

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If you shut down a business, you can’t just lock the doors and turn out the lights. You must provide employees with W-2s by the due date of your final Form 941.

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New legislation proposed by Sen. Connie Mack (R-Fla.) would allow children of any age to own a Roth IRA.

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Despite the recent talk in Congress about alternative minimum tax (AMT) reform (see page 3), the "stealth tax" is still expected to hit millions of unsuspecting taxpayers this year … maybe even you.

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All work and no play can make Jack (or Jill) a disgruntled employee or client. So, you may decide to treat some of your top customers or valued employees to an outing as the summer draws to a close. By knowing the tax-law rules for entertainment costs, you can double your pleasure with top-dollar write-offs.

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A business that operates heavy-duty vehicles must pay a heavy tax when it hits the road: the heavy-duty vehicle use tax (also called the federal "highway use" tax).

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If you operate a manufacturing company and need to clean up land contaminated with hazardous waste, how do you treat the cleanup costs for tax purposes? The IRS clarified that issue in a new ruling last month. (IRS Revenue Ruling 2005-42)

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