CNN lists 6 new small business tax breaks

At JK Harris, we have a lot of small business clients who come to us for either back tax help through our tax resolution services or for bookkeeping services through JK Harris Small Business Services. And, since our company is technically considered a small business, we always keep an eye out for small business owners and their needs.

CNN Money ran an article a few weeks ago which talks about six new breaks for small business owners.

Own a business? 6 new tax breaks by Catherine Clifford

Doing your taxes stinks, right? No fun at all. But take note as you brace for your 2010 return: A handful of changes in the tax code could translate into a fatter refund check.

The Small Business Jobs Act, passed last September, and the historic health care reform law, passed in March, enacted hefty credits and deductions for capital investments and employee health insurance costs.

Here is a rundown of six new credits and deductions likely to affect the most small business owners. Read the rest of the article here.

Things to keep in mind when choosing a tax preparer

The IRS sent out its list today of what to look for when choosing a tax preparer. Remember, it is important to choose carefully when you decide to have your returns prepared by a professional. JK Harris offers tax preparation in conjunction with our tax representation services, small business services or as a stand alone service.

If you pay someone to prepare your tax return, the IRS urges you to choose that preparer wisely. Taxpayers are legally responsible for what’s on their tax return even if it is prepared by someone else. So, it is important to choose carefully when hiring an individual or firm to prepare your return. Most return preparers are professional, honest and provide excellent service to their clients.

Here are a few points to keep in mind when choosing someone else to prepare your return:

1. Ask if the preparer is affiliated with a professional organization that provides its members with continuing education and resources and holds them to a code of ethics.New regulations require all paid tax return preparers including attorneys, CPAs and enrolled agents to apply for a Preparer Tax Identification Number — even if they already have one — before preparing any federal tax returns in 2011.

2. Check on the preparer’s history. Check to see if the preparer has a questionable history with the Better Business Bureau and check for any disciplinary actions and licensure status through the state boards of accountancy for certified public accountants; the state bar associations for attorneys; and the IRS Office of Professional Responsibility for enrolled agents.

3. Find out about their service fees. Avoid preparers who base their fee on a percentage of your refund or those who claim they can obtain larger refunds than other preparers.

4. Make sure the tax preparer is accessible. Make sure you will be able to contact the tax preparer after the return has been filed, even after the April due date, in case questions arise.

5. Provide all records and receipts needed to prepare your return. Most reputable preparers will request to see your records and receipts and will ask you multiple questions to determine your total income and your qualifications for expenses, deductions and other items.

6. Never sign a blank return. Avoid tax preparers that ask you to sign a blank tax form.

7. Review the entire return before signing it. Before you sign your tax return, review it and ask questions. Make sure you understand everything and are comfortable with the accuracy of the return before you sign it.

8. Make sure the preparer signs the form and includes their PTIN. A paid preparer must sign the return and include their PTIN as required by law. Although the preparer signs the return, you are responsible for the accuracy of every item on your return.The preparer must also give you a copy of the return.

Obama signs $30B small business lending bill, according to Associated Press

On Monday, President Obama signed a bill to help give small businesses and entrepreneurs a much needed boost. The bill offers small businesses the opportunity to expand and hire by cutting taxes and offering a $30 billion loan fund. Obama credits small businesses with being the anchors of our Main Streets and the provider of most American jobs. Read the full article below, written by Darelen Superville of the Associated Press.
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WASHINGTON (AP) – Scoring a prized political victory five weeks before the Nov. 2 elections, President Barack Obama on Monday signed a bill to help small businesses expand and hire by cutting their taxes and creating a $30 billion loan fund.

Obama said the incentives will help small businesses right away. But any hiring may not be enough to help some Democrats ahead of crucial midterm elections in which voters are expected to vent their frustrations over a slow-growing economy and near-10 percent unemployment.

The bill had been delayed for months, blocked in the Senate by Republicans. Most in the GOP objected to the loan fund, comparing it to the 2008 financial industry bailout and arguing that it would encourage banks to make loans to risky borrowers. Two GOP senators, George Voinovich of Ohio and George LeMieux of Florida, helped Democrats break the filibuster this month – and the bill passed.

Obama said small businesses are “the anchors of our Main Streets,” creating most of the jobs in the country.

“It was critical that we cut taxes and make more loans available to entrepreneurs,” he said before signing the bill in the East Room of the White House. “Today, after a long and tough fight, I am signing a small business jobs bill that does exactly that.”

The bill creates a $30 billion government fund to help encourage lending to small businesses, many of which have been having difficulty securing bank loans and credit. The fund will be available to community banks, which could use the money to leverage billions more in loans.

The legislation also includes about $12 billion in tax breaks for small business – eight separate tax cuts that take effect Monday. One such provision increases to $500,000 the amount of investments that businesses would be allowed to write off this year and next.

The measure also gives a boost to some Small Business Administration loan programs.

The new law follows earlier administration efforts to help small businesses, including eight different tax cuts as well as a temporary payroll tax holiday for companies that hire people off the unemployment lines.

“This bill will do two big things,” Obama said before signing the bill. “It’s going to cut taxes and it’s going to make more loans available for small businesses. It’s a great victory for America’s entrepreneurs.”

Several business owners who stood with Obama for the signing echoed his sentiments afterward.

Prachee Devada, founder of Synergy Enterprises, Inc., an information technology company in Silver Spring, Md., told reporters that she’ll be hiring at least 20 people as a result of the new law. She said she hired about 20 people under contracts funded by the economic stimulus.

“Obviously this bill is making a huge difference to me as a small business,” Devada said.

Posted by JK Harris