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Hobby or Business? Why It Matters

October 17, 2012 by Troy Eckhardt

Millions of Americans have hobbies such as sewing, woodworking, fishing, gardening, stamp and coin collecting, but when that hobby starts to turn a profit, it might just be considered a business by the IRS. Definition of a Hobby vs a Business The IRS defines a hobby as an activity that is not pursued for profit. […]

How Long to Keep Personal Income Tax Records

October 9, 2012 by Troy Eckhardt

You must keep your records as long as they may be needed for the administration of any provision of the Internal Revenue Code. Generally, this means you must keep records that support items shown on your return until the period of limitations for that return runs out. The period of limitations is the period of […]

Who Must Pay Estimated Tax?

October 8, 2012 by Troy Eckhardt

If you owe additional tax for 2012, you may have to pay estimated tax during 2013. You can use the following general rule as a guide during the year to see if you will have enough withholding, or if you should increase your withholding or make estimated tax payments. General rule: In most cases, you […]

A SIMPLE Retirement Plan for the Self-Employed

October 4, 2012 by Troy Eckhardt

Of all the retirement plans available to small business owners, the SIMPLE plan is the easiest to set up and the least expensive to manage. These plans are intended to encourage small business employers to offer retirement coverage to their employees. SIMPLE plans work well for small business owners who don’t want to spend a […]

Deducting Charitable Contributions: Eight Essentials

October 1, 2012 by Troy Eckhardt

Donations made to qualified organizations may help reduce the amount of tax you pay. With that in mind, here are eight tips to help ensure your contributions pay off on your tax return. 1. If your goal is a legitimate tax deduction, then your charitable contributions, whether a cash donation or non-cash gifts such as […]

What Income Is Nontaxable?

September 30, 2012 by Troy Eckhardt

Generally, you are taxed on income that is available to you regardless of whether it is actually in your possession, but there are some situations when certain types of income are partially taxed or not taxed at all. Here are some examples of items that are NOT included in your income: Adoption expense reimbursements for […]

How to Read Financial Statements

September 29, 2012 by Troy Eckhardt

One of the most important things we do at Eckhardt Accounting is the preparation of financial statements from our clients’ source documents so that relevant information can be returned to the client in a timely manner. With this information, our clients will be better able to make business decisions that will put more money into […]