Harris CPAs LLC

If you and your spouse operate a profitable, unincorporated small business, you face some unique tax issues. The IRS will generally classify your business as a partnership for federal tax purposes. So, you’ll have to file an annual partnership return and both you and your spouse must receive Schedules K-1, which allocate taxable income, deductions and credits between the two of you. You must also pay self-employment (SE) tax on your share of the net SE income passed through to you by the spousal partnership. Your spouse must do the same. The bottom line: Turn to us to keep your business in compliance with the IRS while you and your spouse keep the business running smoothly. Contact us at (479) 361-2201.

Business owners: Should you use cash to pay federal tax debt or keep it for operational needs? Paying the IRS sooner may ease stress and reduce penalties, but draining cash can disrupt operations, payroll and growth. There’s no one-size-fits-all answer. In many cases, the IRS offers options — such as installment agreements, temporary collection holds or penalty relief — that may help you stay compliant while preserving cash flow. The biggest risk is choosing extremes, either depleting cash reserves or ignoring the issue. A balanced strategy often works best. Call us at (479) 361-2201. We can review your options and help you create a plan.

There are several benefits to having an estate plan. It can protect your wealth while giving you peace of mind that your assets will be distributed according to your intentions. In addition, it can save taxes, minimize legal complications and family disputes, and reduce expenses for your heirs. Do you have young children? An estate plan is a must so you can name guardians for them in the event of your untimely death. If you’re ready to begin your estate planning journey, or if you’d like us to review your current plan, contact us at (479) 361-2201.

You probably have retirement questions: How much should I save before I quit working? When should I start taking Social Security benefits? Can I retire before Medicare coverage kicks in? What about taxes in retirement? We can provide you with answers based on your individual financial circumstances and retirement goals. Contact us at (479) 361-2201.

Contributions to Section 530A accounts (also known as Trump Accounts) are now eligible for the gift tax annual exclusion. If, for example, you contribute cash (including via check or EFT) to a child or grandchild’s account, that contribution won’t be subject to the federal gift tax or related reporting requirements, as long as your total gifts to the child for the year don’t exceed $19,000. Note that contributions from most sources are limited to $5,000 per year (not including the initial federal government contribution of $1,000 if the child qualifies), per Section 530A account. Also, the recipient must be under age 18 at the end of the tax year. Have questions? Call us at (479) 361-2201.

Did you know that if you have seriously delinquent tax debt, you could lose your passport? The IRS can “certify” unpaid federal tax debts over $66,000 (adjusted annually for inflation) to the U.S. State Department, which may deny a passport application or renewal — or even revoke your current passport — until your tax issues are resolved. If you’re overseas, you might receive only a limited-validity passport to return to the United States. Unpaid federal tax debt includes individual income taxes, trust fund recovery penalties, business taxes for which taxpayers are personally liable and other civil penalties. Contact us at (479) 361-2201 for details.

Grabbing lunch with a client doesn’t just build rapport. It can also trim your tax bill. Under federal tax law, you can generally deduct 50% of qualifying business meal costs. Whether you're dining with clients, partners or employees, these deductions can reduce your taxable income. Keep detailed records of the expenses, including receipts. Document the business purpose of each meal and the business relationship of the people you dine with. Contact us at (479) 361-2201 with any questions about this deduction.

The 40% generation-skipping transfer (GST) tax generally applies to transfers made to people two generations or more below you, like your grandchildren. And it applies on top of any gift or estate tax due. The good news is that a large GST tax exemption is available: $15 million for 2026. So most taxpayers don’t need to worry about the GST tax. But if you have a large estate, you can allocate your GST tax exemption to contributions to a dynasty trust and allow assets to skip several generations of taxation. Contact us at (479) 361-2201 to learn more.

If your C corporation traditionally makes deductible charitable gifts, make sure you know the rules for 2026 donations. Starting Jan. 1, 2026, corporations can only deduct charitable gifts in excess of 1% of the company’s taxable income, with a 10% of income cap. Amounts exceeding the 10% cap can be carried forward — as can amounts that aren’t currently deductible due to the 1% floor — for up to five years. You may want to execute a multiyear charitable deduction strategy if your company’s income varies from year to year. Contact us at (479) 361-2201. We can help by projecting income and other deductions so you can support your community while maximizing long-term tax benefits.

Accurate bookkeeping and timely accounting records provide the foundation for informed decisions throughout the year. When your books are current and reliable, it’s easier to manage cash flow, identify operational issues and jump on growth opportunities. Contact us at (479) 361-2201 for help streamlining your financial reporting processes and reducing year-end surprises.