Several readers have asked questions about transferring assets from their individual names to a Limited Liability Company (LLC). HT writes: I have been running my business as a sole proprietor (Sch C) and want to change to an LLC. I have been depreciating several assets on Schedule C. Do I need to do anything to...Read More

The decision whether or not to treat a worker as an independent contractor rather than an employee has many consequences. Since IRS has a major stake in classifying workers as employees, while the business owner has just as large a stake in classifying them as contractors, many structural variations have been tried by businesses and...Read More

A couple of days ago I was talking about how lawmakers seem to have responded to the almost universal availability of computers to U.S. tax payers by making the tax law so complex that it’s close to impossible to prepare an accurate return without a computer. For the individual tax payer with wage or salary...Read More

The fourth of July is a day to remember the radical concepts (for 1776) that formed the foundation for the government of the USA. It’s also a time to remember how far we’ve gone in the 23 decades that have passed since 1776, in both good and bad directions. One of the bad directions is,...Read More

There are 5 tests that have to be met to claim someone as your dependent: Member of Household or Relationship Test: the person must live with you or be related to you. Citizen or Resident Test: must be citizen of U.S. or legal resident alien. Joint Return Test: the person must not file a joint return with anyone...Read More

TJ writes: “I got behind on my taxes in 1995 and 1996. I have just received a letter from IRS. They want me to pay $68,007 for 1995 and $4351 for 1996. There is no way I can come up with that kind of money. A friend told me there is supposed to be a...Read More