Qualified Appraisal And Its Process

What is a Qualified Appraisal? A qualified appraisal is an evaluation of the value of a property, asset, or item conducted by a qualified appraiser. It is typically required for tax purposes, such as determining the fair market value of a property for estate planning, charitable contributions, or claiming deductions. …

Not For Profit Organizations And Their Tax Implications

Overview of Not for Profit Organizations Not-for-profit organizations operate differently from for-profit businesses. While for-profit businesses aim to generate revenue and distribute profits to shareholders or owners, not-for-profit organizations focus on achieving their mission and reinvesting any surplus funds back into their programs or services. Not-for-profit organizations can be structured …

Deferred Tax Liability: Definition And Examples

What is Deferred Tax Liability? A deferred tax liability is a tax obligation that a company will have to pay in the future due to temporary differences between the accounting treatment of certain transactions and their tax treatment. It represents the amount of income tax that will be payable in …

Section 1245 Definition Types of Property Included and Example

Section 1245 Definition Section 1245 is a provision within the tax laws that defines certain types of property and determines their tax treatment. It specifically focuses on property that is subject to depreciation or amortization. Under Section 1245, property that falls within its scope is classified as “Section 1245 property.” …

Ring-Fence: Definition in Finance Accounting and Legality

What is Ring-Fence in Finance Accounting? In finance accounting, the term “ring-fence” refers to the practice of separating certain assets or activities from the rest of a company’s operations. This separation is done to protect those assets or activities from potential risks or losses associated with the company’s other operations. …

Material Participation Tests Definition IRS Rules vs Passive

Material Participation Tests Definition IRS Rules Material participation tests are a set of rules defined by the Internal Revenue Service (IRS) that determine whether a taxpayer is actively involved in a business or rental activity. These tests are used to determine whether the taxpayer can claim certain tax benefits related …

IRS Publication 519 U.S. Tax Guide For Aliens

IRS Publication 519 U.S. Tax Guide For Aliens IRS Publication 519 U.S. Tax Guide For Aliens is a comprehensive guide that provides information on the U.S. tax laws and regulations applicable to non-resident aliens. It is an essential resource for individuals who are not U.S. citizens or green card holders …

Forming a Corporation: A Comprehensive Guide

Why Forming a Corporation is Important Forming a corporation is a crucial step for any business looking to establish a strong legal and financial foundation. By incorporating, a business gains several important benefits and protections that can help it thrive and succeed in a competitive marketplace. Another important reason to …

Form 1120-S U.S. Income Tax Return for an S Corporation

Overview of Form 1120-S Form 1120-S is a U.S. Income Tax Return specifically designed for S Corporations. It is used to report the income, deductions, gains, losses, and other information of an S Corporation to the Internal Revenue Service (IRS). An S Corporation is a type of business entity that …

Form 1095-C Definition Uses Tax Filing Requirements

What is Form 1095-C and its Definition? Form 1095-C is a tax form used by employers to report information about their employees’ health insurance coverage. It is a requirement under the Affordable Care Act (ACA), which mandates that certain employers provide affordable health insurance to their employees. The form provides …

Form 1095-A Definition Filing Requirements How to Get One

Form 1095-A Definition and Filing Requirements Form 1095-A is an important document that taxpayers need to be aware of when filing their taxes. This form is used to report information about the health insurance coverage obtained through the Health Insurance Marketplace. It provides details about the coverage, including the premium …

Deferred Tax Asset Calculation Uses and Examples

Deferred Tax Asset Calculation Deferred tax asset calculation is a process used by businesses to determine the amount of tax benefits that can be claimed in future periods. This calculation takes into account the difference between the accounting profit and taxable profit, which arises due to the differences in the …

Custodian in Banking and Finance: Definition and Role

Custodian in Banking and Finance: Definition and Role In the world of banking and finance, a custodian plays a crucial role in ensuring the safety and security of financial assets. A custodian is a trusted entity that holds and safeguards various types of assets on behalf of its clients. These …

Alternative Minimum Tax (AMT) Definition and How It Works

What is Alternative Minimum Tax (AMT)? The Alternative Minimum Tax (AMT) is a parallel tax system in the United States that ensures individuals and corporations with high incomes and significant deductions pay a minimum amount of tax. It was introduced in 1969 to prevent high-income taxpayers from using various tax …