Q: In 2013, what happens to the Estate and Gift Tax?
A: In the event Congress does not act on the Estate and Gift tax exemption, the levels will revert back to $1,000,000 each. While it is likely Congress will act, the consequence of being unprepared could be an issue in many estates.
Q: How do you determine whether a worker is an employee or independent contractor?
A: Primarily, you look to the control that you have over the employee. If you generally control the worker and methods the worker uses to perform their tasks, they tend to be classified as an employee. If the worker has a fair degree of autonomy on the job, autonomy with finances, and less relationship with the principal, generally these workers can be classified as independent contractors.
Q: I am an S Corporation owner, and I have recently sold business assets that have been held for over a year. How do I report the sale of these assets?
A: While instinctively the owner would want to file a Schedule 1040 D and take the loss as a personal loss, this would be the wrong course of action. The sale of business assets is filed on Form 4797, which carries different results that are better for the taxpayer.
By: Basi & Basi at the Center for Financial, Legal and Tax Planning for Transworld M&A Advisors