April 2012

Apr

28

Payroll Tax Indemnification Agreement

General / Legal Concepts  Posted by / 0 comments

Many people are involved in a partnership or are shareholders of a corporation and their roles and duties in the company have nothing to do with the financial aspects of the business.  These people carry on their duties and let the other partners deal with the financial duties.

If this fits your duties in a business and your company has employees and your business is required to collect taxes and remit them to the government then you might want to consider entering into an agreement with your partners or the other owners of the business a payroll tax indemnification agreement.  The agreement will protect you and require the other partners to reimburse any payroll tax penalty that you might suffer personally if the IRS determines that company failed to fulfill its payroll tax remittance requirements.

Just so that you are clear, this agreement would only obligation them to pay you back what the IRS takes from you because you will still be personally liable for none remitted payroll tax.

The agreement can be as simple as stating that all the co-owners or shareholders agree to indemnify any of the other owners or shareholders that may be held liable for any unpaid payroll tax liabilities of the business that are proposed or assessed against them personally, plus legal cost in contesting the taxes.

Apr

17

Writing off business expenses

General / Tax Deductions  Posted by / 0 comments

As a business owner, you are constantly having to entertain people to draw up new business.  Sometimes your entertainment expenses are to maintain current business relationship.  When tax time comes around, you need to figure out which expenses are deductible to minimize your tax liability.

As a general rule, you can deduct entertainment expenses if the expense was use to entertain a client, customer, or employee if the expenses are directly related or associated to your trade or business.

If the entertainment took place in a business setting or the main purpose of the entertainment was to conduct business and you actually did some business and you had more than a general expectation of getting income or some business benefit from the activity then it is deductible.

Or if the entertainment is associated with your trade or business and the entertainment directly preceded or follows a substantial business discussion.

So how can you deduct?

You can deduct 50% of your business entertainment expenses.  The transportation cost to the entertainment location is fully 100% deductible.

Apr

15

Constructive Income

General / Legal Concepts  Posted by / 0 comments

“Constructive Income” is a form of income that should be declared on your tax income.  The IRS consider income to include constructive income.  Constructive income is define as income, for tax purposes, money or property that is available to you or is credited to your account.  The income is taxable as soon as it becomes available to you.

For example, say you were working hard and during work for a client for the entire year.  They finally pay you $20,000.00 for all the work that you did on December 15, 2012.  You had a particularly good year and if you deposit that check, your overall earned income will put you into a higher tax bracket.  This will cost you thousands of dollars in additional taxes.

So to avoid the additional taxes, you decide to deposit the check on January 5, 2013 so that the $20,000 can be reported on your 2013 taxes instead.  Under the tax code, the $20,000.00 was available to you on December 15, 2012, and should be listed as income in the 2012 tax year.

Apr

12

City of Houston

General  Posted by / 0 comments

Most people will agree that the city of Houston is stunning.  It has a combination of tall modern high rise buildings with lush green recreational areas. But some may not understand exactly how great Houston really is. There are so many facts about Houston that few know.  For example, Houston is the fourth largest city in the state of Texas. Houston was called the chief executive with the Republic of Arizona during the time of Jan Houston.

Huston has a population of about 2.2 million and is the sixth largest metropolitan in the United States. The metropolitan area of Houston-Sugar Land-Baytown is the economic center of the city.

The city is home to a large variety of industries and a large number of Fortune 500 companies. In fact, only the city of New York has more Fortune 500 companies than Houston. The large population of the city is also culturally diverse with many different ethnicities.

The economic climate of Houston continues to grow very fast in all sectors. The industries that define the bulk of the municipality’s economic climate are travel, power, production, aeronautics, and health-related services. Due to Houston’s varied market sectors, the city’s economic system is very productive.

Given that Houston is a diversify city, there are numerous activities that celebrate the city’s diversity. The Houston Delight Parade, the Houston Cows Present as well as the Rodeo, and the Houston Greek Festival are some examples.

If you are into the martial arts, there is the Theater Martial arts district located in downtown Houston that holds six efficiency halls as well as eight businesses. While the Memorial Region has several galleries and museums.

Apr

10

Welcome!

General  Posted by / 1 comments

Welcome to Houston Tax Attorney!  We have created this blog to help those in the Houston area needing a tax attorney.  Although we are not giving out specific legal advice to any individuals, we will be explaining how the law works in the tax area of law in the general sense.  We hope the information provided here will be of some help for those needing some tax information living in the city of Houston.