CDTFA Audit Clarification

As we discussed in the last newsletter, many dentists are being audited by the California Department of Tax and Fee Administration (CDTFA.)  As a reminder, this initiative for collecting taxes came about by California Assembly Bill (AB) 147 requiring retailers located outside of California to register with the CDTFA and collect California use tax.  If you are selected, your audit will be for a three-year period in which they look for purchases you made that did not have sales tax paid at the...Read More

California Maternity Leave

California offers two benefits for maternity leave, Disability and Paid Family Leave. These benefits are taken consecutively, not concurrently. First, California’s SDI program covers mothers who are temporarily unable to work due to pregnancy and childbirth. The usual period of disability recognized by the SDI program for a normal pregnancy begins four weeks before the birth of a child and extends to six weeks after the birth of the child. However, a physician may certify to longer...Read More

W9s/1099s and You the Dental Practice Owner

The end of the year is hectic enough without having to figure out W9 forms and 1099s. Lucky for you, PracticeCFO is here to help. In this article I am going to explain step by step the process you, the practice owner should be taking each time you work with a new vendor or any non-employee. Before we dive into the fun, let’s discuss the basics of a W9 form and a 1099 MISC. A W9 form gives us the information needed to provide both the IRS and your contractor, a year-end tax statement called a...Read More

This tax deduction is as good as free money

David Knittel, CPA | Director of Tax   If you are not familiar with the acronym QBID you should be; let me explain why.  QBID stands for the Qualified Business Income Deduction.  The calculations and limitations can be complicated but in its simplest form the QBID can provide a tax deduction of up to 20% of your practice income without costing you anything in return.  Free money…if you qualify.  Making sure you qualify is the tricky part and is where we can help! The QBID was put...Read More

The Best Way to Reduce Tax and Increase Your Net Worth

I often get asked by my clients, ‘what’s the best way to save big on taxes?’  Well, for most people, here it is.  Saving for retirement saves on tax and improves your net worth immensely.  There are a lot of numbers below, and for the most part I’m going to let them speak for themselves.  If you have a little extra cash in your business (<$20K in this example), you can reduce your tax $18K and better your net worth by $56K….$56K!!  That adds up over the years.  Some (but not...Read More

To entertain or not to entertain…

The Tax Cuts and Jobs Act implemented changes that were enormously beneficial for our clients in 2018.  The basic condensing of tax brackets and lowering of just about all tax rates, as well as the vastly improved AMT exemptions, proved to lower the marginal tax rates for a large majority of our client base.  The implementation of the Qualified Business Income Deduction also served to lower the amount of taxes paid by many.  But before I sing the bill’s praises too loudly, I must mention...Read More

The Qualified Business Income Deduction Made Simple

When the Tax Cuts and Jobs Act was signed into law by President Trump on December 22, 2017 the tax landscape for practice owners changed dramatically. Not only did the personal tax brackets change significantly, the bill also introduced a brand-new provision to reduce tax on passthrough income; the Qualified Business Income Deduction. As with most things tax related, the provision and eligibility requirements are not simple. But fear not, we have waded through the deep waters of the law and...Read More

Form 1099 FAQ

It’s that time of the year again when you as a practice owner need to start thinking about 1099s. We have created this FAQ for all things 1099. The process starts with a Form W-9. We will create and file your 1099s but we do need your help collecting information found on Form W-9. Please note 1099s are only for payments made via cash, check, and EFT payments. Therefore, we encourage you to make all payments via credit or debit card. What exactly is Tax Form W-9 and what are they used...Read More

Year-end tax planning for dentists

If you find yourself asking your CPA for tax planning ideas in March and April when your corporate and personal tax returns are due, you will most likely have missed the bus when it comes to the most beneficial tax moves.  True tax planning happens before year-end when action can be taken to implement strategies to save you money.  Here are some tax saving moves to consider as we near the end of 2017. Home Office: Set up a home office to be used regularly and exclusively to perform the...Read More

Update on the GOP Tax Bill

Last Thursday the tax community started buzzing with the release of the initial version of the GOP tax bill.  It is possible that reading the new tax bill did not make your top five list of things you wanted to do this weekend.  Fortunately, you have us for that! While the current bill gives us insight into the ultimate goal and intent of the bill, it is important to keep in mind that this is the very beginning of the process and there will most likely be modifications to come as the bill...Read More
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