Charitable Donations

02-20-2020Tax Information

When it comes to tax planning, there are few more emotionally charged decisions than those around charitable giving. People tend to have deep, personal attachments to the causes they support and may have been donating to their chosen charity for years or even decades. They see their donations as a vital way to give back to society and to feel connected to a broader community, whether it be on a local, national or even spiritual level.

Any good financial adviser understands that it’s hard for clients to make a pragmatic cost-benefit analysis around such personal decisions. However, it’s our responsibility to make sure that clients understand how to optimize their charitable donations and ensure that they’re getting the most bang for their buck, both for their charitable causes and their own personal tax benefit. And there’s no better time to do that than at the beginning of the year, after the mad scramble around the holidays has died down.


The need to properly document travel deductions for tax purposes

02-06-2020Tax Information

You are generally entitled to deduct the cost of your travel expenses, within certain limits. But the tax law imposes strict substantiation requirements. Recently, the Tax Court denied a deduction because the taxpayer didn’t establish the requisite relationship between his business and the travel expenses. (Near, TC Memo 2020-10, 1/14/20)

Most self-employed individuals can deduct ordinary and necessary expenses incurred when traveling on business. This includes transportation costs back and forth from your business destination, as well as any business-related expenses at your business destination, such as lodging. The full amount is deductible if the trip is completely business-related.


Key Changes to 2019 Arizona Income Tax Returns

01-30-2020Tax Information

The individual income tax filing season for state and federal returns opened this week. Here are some key changes when filing for 2019 tax year.

  • Matches the federal standard deduction amount
    • $12,200 single/married filing separate
    • $18,350 head of household
    • $24,400 married filing joint

2019 Arizona Individual Income Tax Changes

12-18-2019Tax Information

Are Arizona itemized deductions the same as the federal itemized deductions?

Arizona itemized deductions are the same as the federal itemized deductions except:

  • All qualified medical expenses are allowed.
  • Any charitable donations claimed on the federal return for which an Arizona credit is claimed, must be removed from the Arizona itemized deductions.
  • Arizona will allow a deduction for mortgage interest not allowed on the federal return due to claiming a federal mortgage credit.

How to benefit from a Home Office Deduction

11-06-2019Tax Information

A home office deduction can be taken when a taxpayer uses a portion of their home exclusively, and on a regular basis, for any of the following:

  • As the taxpayer’s main place of business.
  • As a place of business where the taxpayer meets patients, clients or customers. The taxpayer must meet these people in the normal course of business.
  • If it is a separate structure that is not attached to the taxpayer’s home. The taxpayer must use this structure in connection with their business
  • A place where the taxpayer stores inventory or samples. This place must be the sole, fixed location of their business.
  • Under certain circumstances, the structure where the taxpayer provides day care services.

Employee vs Independent Contractor

10-30-2019Tax Information

Employers, please be aware that just because you think someone is an Independent Contractor, the IRS and Tax Court might not agree.


5 tips for effective not-for-profit board oversight


The attached link is to an article in the Journal of Accountancy that is a good reminder to those individuals involved with non-profit organizations.


  • Recruit board members with the time and skill sets that contribute to a well-rounded board
  • Train members on their roles and responsibilities
  • Take good minutes
  • Set the yearly board calendar appropriately
  • Address board members who aren’t performing or contributing

Redesigned W-4 Form

08-13-2019Tax Information
IRS releases new W-4 for 2020

The Internal Revenue Service released a redesigned Form W-4 for tax year 2020. The redesigned Form W-4 employs a building block approach to replace complex worksheets with more straightforward questions that make it simpler for you to figure a more accurate withholding. The new form uses a more personalized, step-by-step approach.

Employees who have submitted a Form W-4 in any year before 2020 are not required to submit a new form merely because of the redesign. Employers will continue to compute withholding based on the information from the employee’s most recently submitted Form W-4.

Impact on IRS Operations during Government Shutdown

12-28-2018Tax Information

Due to the current lapse in appropriations, IRS operations are limited. However, the underlying tax law remains in effect, and all taxpayers should continue to meet their tax obligations as normal.

  • Individuals and businesses should keep filing their tax returns and making deposits with the IRS, as they are required to do so by law.
  • The IRS will accept and process all tax returns with payments.
  • Payments accompanying paper tax returns will still be accepted as the IRS receives them.
  • Tax refunds will not be issued until normal government operations resume.

How much is enough (to retire)? 


Fidelity Investments, the nation’s largest retirement plan provider, recently released some statistics related to its customers that save for retirement. The number of Fidelity 401(k) accounts with a balance of $1 million or more recently hit a record of 168,000, up 41% from last year.

To give you an idea of how your retirement savings stack up against your peers, check out the average 401(k) balances in Fidelity accounts, as of the second quarter of 2018, broken down by age.


When do I start drawing Social Security?


Many Americans work with dreams of a comfortable retirement. We pay 6.2% of our wages into the Social Security system and our employers match another 6.2%. So when do we start reaping our rewards?

You can start receiving retirement benefits on your 62nd birthday. However, every year you delay your Social Security benefit payment, you will get an 8% increase in benefits up until age 70.

There are some questions you need to ask yourself and your financial and tax advisor. There are good arguments that support early receipt and good arguments that support waiting until age 70.


IRS Proposes Changes to Charitable Contribution Rules related to State Tax Credits

08-27-2018Tax Information

The IRS proposed legislation on Thursday, August 23, 2018 that would possibly eliminate your ability to use State Tax credits as an Itemized Deduction on your Federal income tax return. If you believe this legislation will become law, here are some quick considerations for you to make by Monday, August 27, 2018. (Yes, you only got 4 days to act)

In Arizona, this proposed legislation would impact donations for state tax credits to:

  • Qualified Charitable Organizations (formerly Working Poor)
  • Public Schools Activity Fees
  • Student Tuition Organizations
  • Military Family Relief Fund
  • Foster Care

Other states may have programs like Arizona to allow such credits.