Recent Articles

Pass Through Taxation

A form of taxation allocated to partnerships, S-Corporations, trusts and a few other special types of business operations by the IRS. This information is reported via Form K-1 and this document allocates the earnings, special forms of income and deductions to the respective owners based on some preset formula.

Owner Compensation in an S-Corporation

06/05/2015

One of the tax attributes of an S-Corporation over other forms of tax entities is the ability to reduce the overall tax obligation.  Naturally the lower the overall tax requirement the more profit generated for the owner(s).   The S-Corporation [...]

Real Estate Investment Trusts – REITs

12/09/2014

Real Estate Investment Trusts are corporations, trusts or associations that act as agencies in real estate and associated mortgages. This is a specialized tax segment and it requires recognition by the Internal Revenue Service to operate as a Real [...]

At-Risk Rules – An Elementary Understanding

10/28/2014

Code Section 465 of the Internal Revenue Code defines ‘At-Risk’ as the financial value the taxpayer has in jeopardy related to the business activity the taxpayer is invested in as some form of an owner.  Effectively, the taxpayer may only take [...]

Why You Should Incorporate Your Business

03/19/2013

As a small business grows, there comes a time when the owner(s) should consider incorporating the business.  A corporation is a separate entity recognized by the state of domicile for the business.  It is as if a new life is created.  The state [...]

What is a K-1?

02/14/2013

A K-1 is a reporting tool to the Internal Revenue Service.  It is used by Partnerships, S-Corporations and Trusts to report the taxpayer’s share of income, deductions, and credits.  A K-1 is similar to Form W-2 or 1099 in that the information [...]

The Basic Principles of a Partnership

02/10/2013

A partnership is a form of a business entity that provides many more advantages than any other form of business entity.  There are several basic principles of a partnership that once understood, the reader can use to his advantage in the small [...]