Springer Rudy and Company

These two terms get used interchangeably all the time, but they work very differently.

A tax deduction reduces your taxable income. So if you're in the 22% tax bracket and you claim a $1,000 deduction, you save $220 in taxes.

A tax credit reduces your tax bill directly, dollar for dollar. A $1,000 tax credit saves you $1,000 in taxes regardless of your bracket.

This is why credits are generally more valuable than deductions, even when the dollar amounts look the same on paper.

Some credits are even refundable, meaning if the credit is larger than what you owe, you get the difference back as a refund.

Today is National Drive-Thru Day, and while we appreciate a good fast food run as much as anyone, we want to make sure your business meal deductions are actually deductible.

Here's the quick version: business meals are generally 50% deductible when there's a genuine business purpose and a client, prospect, or employee present. The food has to be reasonable, not lavish, and you need to document the business purpose and who was there.

Drive-thru lunch by yourself while thinking about work? Not deductible. Sorry.

Happy National Drive-Thru Day -- enjoy that burger on your own dime!

One of the most common questions we get: how long do I need to keep my tax records?

Here's a simple guide:

-Tax returns: Keep forever.
-Supporting documents (receipts, W-2s, 1099s): At least 3 years from the date you filed, which is how long the IRS generally has to audit you.
-Records related to property: Keep until you sell the property, plus 3 years after.
-Records for bad debt deductions or losses: 7 years.

When in doubt, keep it. Digital storage is cheap and the peace of mind is worth it.

Heads up to our Pennsylvania business clients: PA sales tax returns are due this Monday, July 20th.

Monthly filers: your June return is due.
Quarterly filers: your Q2 return (April through June) is due.

Don't forget: even if you had zero taxable sales, you still need to file a return to avoid penalties.

There's still a lot of year left, and that's actually good news when it comes to taxes. Decisions you make between now and December 31st can change what you owe next spring. Here are a few things worth looking at right now while there's still time to do something about them.

How to Make the Most of the Second Half of the Tax Year It's easy to think about taxes only when you're forced to, which for most people means somewhere between January and April. But the second half of the calendar year is actually when some of the most useful tax planning h...

If you own a business and you're still running everything through your personal bank account, this one's for you.

Mixing personal and business finances is one of the most common mistakes small business owners make. It's also one of the most expensive come tax time. It makes bookkeeping harder, muddies your deductions, and raises red flags if you're ever audited.

The fix is simple: open a dedicated business checking account and a business credit card, and run all business income and expenses through them. Your bookkeeper (and your CPA) will thank you.

If you've tried to call the IRS lately and couldn't get through, you're not imagining it. The agency has lost nearly 30,000 employees over the past year, and the impact on phone service and processing times is real.

Why Is It So Hard to Get the IRS on the Phone Right Now? If you've tried to contact the IRS recently and couldn't get through, you're not imagining it and you're not alone. We hear this from clients regularly, and the frustration is completely valid. Here's what's going on and...

Wishing everyone a safe and happy Fourth of July weekend from all of us at Springer Rudy and Company!

While you're enjoying the celebrations and fireworks, here's a fun fact: the first federal income tax in the United States was introduced in 1861 to help fund the Civil War. It was 3% on incomes over $800. Things have gotten a bit more complicated since then!

We'll be back in the office on Monday. Enjoy the long weekend!

If your bookkeeping has fallen behind this year, you're not alone. Summer is honestly the best time to deal with it. Things slow down a little, you still have months before year-end, and getting caught up now makes tax season a whole lot smoother. Here's where to start.

Summer Is the Best Time to Catch Up on Your Books If you're a small business owner, there's a good chance your bookkeeping is not exactly where you want it to be right now. Between the rush of tax season earlier this year and the day-to-day demands of running a business...

If you've ever hired a contractor or freelancer, you've probably asked them to fill out a W-9. But what is it actually for?

A W-9 collects the contractor's name, address, and taxpayer identification number so you can issue a 1099 at year end if you pay them $600 or more. Without it, you could end up withholding 24% of their pay as backup withholding, and nobody wants that conversation.

Best practice: collect a W-9 before you write the first check. Chasing one down in January is nobody's favorite way to start the new year.

Questions about contractor payments or 1099s? That's what we're here for. Give us a call.