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How many home runs did Al Kaline hit, lifetime? 

What is the capital of Assyria? 
no idea

Is the Home Office Deduction an audit flag? 
No, this myth keeps hanging on. We’ve never seen an audit that seemed to be “triggered” by the presence of this deduction. In fact, numerous audits of tax returns that included the Home Office deduction have not included a scrutiny of it. It’s a communist plot.

What are the advantages of operating my business as an S-Corporation? 
The most prominent advantage is the ability to reduce payroll taxes of the employee-shareholders, by limiting salaries to “reasonable compensation”. In a sole proprietorship or partnership, generally all earnings are subject to social security tax. S-Corporations allow us to control the amount of this tax.

A second advantage of an S-Corporation is that it avoids the “Double-taxation” imposed on the earnings of a C-Corporation. This is particularly important when the Corporation is sold.

I have a business and personally have a lot of medical expenses, what can be done? 
If your business is a sole proprietorship and your spouse works for the business, you can establish a Section 105 Plan, which allows you to deduct the medical expenses as a business expense! This is a significant tax savings over the conventional medical deduction on Schedule A.

What is a Health Savings Account? 
It’s an account at a bank or other financial institution designed to allow you to make tax-deductible contributions for the purpose of paying out-of-pocket medical expenses. It is associated with a “High-deductible” health insurance policy.

I hear that its “good” to have mortgage debt so I have the tax deduction. What’s up with that? 
Its mostly mythical. Sure, tax deductions are good, but we mustn’t allow the tax-tail to wag the dog. Its good to be debt free, too.

Is it a catastrophe if I go into the next tax bracket? 
We’ve learned that this notion is largely misunderstood. When income rises so that you enter the next tax bracket, not all of your income is then subjected to that new bracket. Only the marginal income is affected.

If I owe taxes at the end of the year but can’t pay them right away, what are my options? 
The IRS routinely allows payment under an Installment Agreement, which spreads the tax, with interest, over as much as 6 years.

What is a “Breakeven Sales” amount? 
It’s the amount of sales that, after reducing for the cost of goods sold and other strictly variable expenses, is sufficient to cover the fixed expenses of the business.

What are your fees? 
As you can imagine, it depends. In general, we are a bit higher in cost than the lower-end providers and much lower than the local, regional, and national CPA firms. We can usually provide a fixed-fee quote so you won't be surprised.

What is an Enrolled Agent? 
Perhaps you noticed that we all have this designation. An Enrolled Agent title is earned by passing tax examinations administered by the IRS. The tests concern only taxes, unlike the CPA exam, which largely includes accounting, auditing and only partially involves taxes. Like CPA's, the Enrolled Agent designation requires continuing education of at least 24 hours annually of accredited tax updates and instruction. It is our policy to exceed this requirement with 40 hours of seminars and other continuing ed resources. The Enrolled Agent designation allows us to represent you with the IRS in audits and with Power of Attorney in correspondence issues.

How do we get our tax information to Martin & Luxford, LLC? 
There are several options available for getting your taxes done. Our preferred method is in a face to face meeting, scheduled at your convenience, where we prepare your returns while you watch. This allows you to see the results and us an opportunity to explain them...and, to talk about the following year and ways that taxes could be reduced and surprises avoided. You may also mail or drop off your information, and we can call or email questions and discuss the results prior to completion.
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