How High Deductible Health Plans Save You Money
As 
a business owner, you’re always looking to save employee associated costs. One of the largest of those costs is health care. That’s why employers across the country are moving towards high deductible health plans. These plans still allow the company to provide insurance while saving money at the same time.
For sometime now companies have been looking for ways to share the cost of insurance with their employees. High deductible healthcare plans are one way to do this. These plans tend to have deductibles ranging from $1,000 to $10,000. These larger deductibles bring down the cost of monthly premiums for both the employee and employer.
Some studies also show that when employees have to pay a larger share of their health care costs they tend to live healthier lifestyles which in turn decreases medical spending.
It also means less sick days and higher productivity while at work. This alone can save companies substantial amounts of money as sick days cost US companies $576 billion dollars annually.
In 2018 a new tax on what are considered Cadillac insurance plans will go into affect. This tax will increase company’s employee costs, so many companies are getting ahead of the issue and dropping these high end plans and replacing them with high deductible insurance plans now.
According to data from 54 large US companies with a combined employment force of 13 million, healthcare costs for these companies was reduced from 6.6% to 3.4% over a three year period. Even though this is short-term data, it does suggest that businesses that utilize high deductible health plans will save money on employee insurance costs over time.
While the switch from traditional insurance to a high deductible health plan may seem difficult, that is the direction the country is taking. In 2006 only 4% of employees had one of these plans and currently 20% does. Going forward, when looking for a competitive edge, businesses will need to consider making the switch.
Tax Advantages of Donating Stock
Making donations to non-profit organizations is a great way to do good works in the community your small business serves. It can also be a huge tax advantage to small businesses – especially if you take advantage of one not so widely known option to double up on your tax benefits.
Donating appreciated stocks allows you a “double play” of sorts when it comes to tax advantages. You get to claim the appreciated value of the stocks you donate while claiming the tax benefit of that appreciated value without paying the taxes on the gains.
How is This Possible?
Tax deductions on charitable donations are equal to the fair market value of the donation. This means that when stocks are donated, the deduction businesses (or individuals, as the case may be) are able to claim for their taxes is the full value of the stock at current prices.
Combine that with the fact that donors do not have to recognize capital gains on donated properties that are investments, and you have the perfect pair for giving that gives back.
Other Benefits of Offering Stock as Gifts
Aside from the tax benefits, businesses and individuals alike, can appreciate other reasons for donating stocks as their giving. One primary consideration is that it preserves the organizations available cash to fill other needs.
Curious about what donating stocks can mean for your tax picture? Make sure you contact us to get more information as well as the pros and cons of this kind of gifting decision.
Top Five Reasons the IRS will Sue You
No one enjoys paying taxes, but the vast majority of individuals and businesses follow the rules, take their deductions, and write a check for what they own. Of course, there are those that try to find ways to avoid paying taxes, but too often, the IRS consider these loopholes tax fraud. Once you go down that road, you can expect to be audited and even sued by the IRS. Here are five of the top reasons the IRS will sue you.
NOT FILING FOR FRIVOLOUS REASONS
If someone has told you that filing your tax return is voluntary due to the lack of a tax collection provision in the United States Constitution, don’t listen to them. While it is true that the constitution doesn’t give the federal government the right to collect income tax, the 16th amendment does.
ABUSE OF TAX SHELTERS AND TRUSTS
While there are many legitimate reasons for and uses of tax shelters and trusts, if one is set up solely to hide income, this is seen as an abuse of the system. The IRS will not see a tax shelter but instead a tax dodge and consider this tax fraud.
OFF-SHORE TRUSTS
If you establish an off-shore trust without a legitimate business reason, plan on hearing from the IRS. If you have an off-shore trust, you will need to be able to prove to the IRS that there is a concrete, business purpose for the trust; otherwise, they will assume you are using it to avoid your tax liability.
STRUCTURED TRANSACTIONS
For those that have high incomes, the IRS consider these tax returns high risk as the individual filer has the ability to use corporations, partnerships, and trusts to move money or perform structured transactions. A structured transaction is one that has little to no monetary benefit with the actual purpose of reducing your tax liability.
OFF-SHORE CREDIT CARDS
While you are allowed to have an off-shore credit card, the IRS will take a close look as to exactly why you have one. They assume from the beginning that it is being used to evade taxes. If you have an off-shore credit card, you will be audited, so be prepared to have documentation as to why you have it.
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