Question: I own two separate businesses and am considering adopting a profit sharing and 401(k) plan for my employees. Is my advisor correct that the plan must cover the employees of both companies?
Tax Planning for Lottery Winners
Question: My husband and I recently won the grand prize from my State’s lottery. Can you provide some guidance on how we will be taxed on our lotto winnings?
Real Estate Investments in IRAs
Question: I have a significant balance in my individual retirement account. Can I use my IRA to purchase real estate?
Answer: You can purchase real estate from your IRA. Various requirements must be satisfied to comply with IRA real estate purchases, however, and the failure to adhere to the requirements can be costly from a tax perspective.
Deferring Tax on Vacation Home Sales
Question: I am contemplating selling my vacation home which my family uses for personal purposes and also rents to third parties. If I purchase a new vacation home, can I defer the recognition of gain on the sale through a tax-deferred exchange?
Classifying Service Providers as Employees or Independent Contractors
Question: One of my employees is leaving the company but will continue to render services for our business. Is there a problem if I treat the worker as an independent contractor?
Tax Strategies with Incentives Stock Option Plans
Question: I hold incentive stock options which I received from my employer. Since the stock is trading above the option exercise price, should I exercise the options and acquire shares of employer stock or do a cashless exercise?
Avoiding the Tax Trap in Transferring Installment Sale Obligations
Question: I just sold stock in my corporation to a third party and received a cash payment upfront with the balance of the sale proceeds to be paid to me in the future. Since I do not need the additional funds, can I make a gift to my children of the right to the future payments?
Obstacles in Establishing Non-Qualified Deferred Compensation Plans
Question: I want to create a deferred compensation plan for certain highly paid employees of my company to provide additional benefits for them, separate and apart from the company profit sharing and 401(k) plan. Can you advise what obstacles I must be concerned with?
Avoiding Taxable Gain on Mortgage Foreclosure
Question: My daughter is well behind on her home mortgage payments and her house will likely be lost by foreclosure or otherwise. Will she have to pay tax on the unpaid mortgage balance?
Establishing Disability Insurance Program for Employees
Question: I own and operate a small business and am trying to determine how best to establish an insured disability insurance program for the company employees. If an employee becomes disabled and receives benefits from the insurance company, will the employee be taxed on the benefits received?