#tax-compliance

Tax Compliance

Stay compliant with tax regulations and filing requirements

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May 19, 202612 min read

Section 1059 Extraordinary Dividend Basis Reduction: The Corporate Shareholder Trap That Turns Tax-Free Dividends Into Immediate Capital Gain

Section 1059 reduces a corporate shareholder's stock basis by the nontaxed portion of an extraordinary dividend — 5% threshold for preferred, 10% for common — when received within two years of acquisition, with excess immediately taxed as capital gain. This guide covers the thresholds, the 85-day and 365-day aggregation rules, the FMV election, the non-pro-rata redemption exceptions, and the lot-level bookkeeping that keeps corporate finance teams out of audit trouble.

Mike Thrift

tax-planningtax-compliancec-corporation

May 19, 202611 min read

Section 277 and 501(c)(7): Member vs. Nonmember Income for Social Clubs

Section 501(c)(7) social clubs must keep nonmember income under 35% of gross receipts and nonmember facility use under 15%, while Section 277 quarantines member-side losses for nonexempt membership organizations. This guide walks through how the two rules interact, how to allocate UBTI expenses on Form 990-T, and how to structure a chart of accounts so the member/nonmember split survives an IRS examination.

Mike Thrift

taxtax-compliancenonprofit

May 19, 202612 min read

Section 467 Rental Agreements: Stepped, Prepaid, and Deferred Rent Under the Tax Code's Anti-Abuse Rule

Section 467 forces accrual accounting and imputed interest on commercial leases over $250,000 with stepped, prepaid, or deferred rent — overriding cash-basis treatment, recharacterizing part of every rent payment as a deemed loan between landlord and tenant, and creating Schedule M-1 book-tax differences from ASC 842 straight-line rent.

Mike Thrift

taxtax-compliancereal-estate

May 19, 202612 min read

Section 685 Qualified Funeral Trusts: Making the QFT Election, Form 1041-QFT, and Reconciling State Pre-Need Rules

How funeral homes, cemeteries, and memorial providers use the IRC Section 685 election on Form 1041-QFT to tax pre-need trust income at per-contract individual brackets — and how to reconcile state pre-need rules, deferred revenue, and restricted trust assets on the operator's books.

Mike Thrift

form-1041trusttax-compliance

May 19, 202616 min read

Solar Installation Contractor Accounting: Customer Deposits, RECs, PPAs, and Passing Through the Section 48 ITC Without Triggering Recapture

A solar installer's bookkeeping playbook — customer deposits under ASC 606, REC inventory, PPA classification under ASC 842, the 50% basis reduction on the Section 48 ITC, Section 6418 transferability mechanics, and the five-year recapture clock that survives a sale of the business.

Mike Thrift

constructionbookkeepingtax-credits

May 19, 202612 min read

Streamlined Sales Tax in 2026: One Free Portal, 24 States, and Free CSP Services for Multistate Sellers

A 2026 field guide to the Streamlined Sales Tax Project — the 24 member states, how the free SSTRS portal works, who qualifies as a CSP-compensated seller for free Avalara, TaxCloud, Sovos, or AccurateTax service, and when SST is the wrong choice for multistate online and SaaS sellers.

Mike Thrift

sales-taxtax-compliancemulti-state-tax

May 18, 20269 min read

Brewery Bookkeeping: Cost Per Barrel, TTB Excise Tax, and the Shrinkage That Makes COGS Lie

How to build a craft brewery's books so cost of goods sold tells the truth—a production chart of accounts, a true cost-per-barrel formula using net barrels, TTB excise tax rates ($3.50/barrel on the first 60,000), and the 3–8% shrinkage that inflates margin if ignored.

Mike Thrift

bookkeepingsmall-businessinventory

May 18, 202612 min read

The Convenience of the Employer Rule in 2026: Why Your Remote Workers May Still Owe Tax to the Office State

Eight states tax remote workers as if they sat in the office. A 2026 guide to the convenience of the employer rule, the May 2025 Zelinsky decision, reciprocity agreements, resident credits, and what multi-state employers must withhold.

Mike Thrift

remote-workmulti-state-taxtax-compliance

May 18, 202615 min read

Distillery Accounting and TTB Bonded Inventory: A Craft Distiller's Guide to Proof Gallons, Excise Tax, and Form 5110.40

How craft distilleries should account for bonded inventory, capitalize aging costs, and reconcile TTB Form 5110.40 to the general ledger — including the $2.70 CBMA reduced rate, controlled-group traps, and why federal excise tax belongs in COGS, not operating expense.

Mike Thrift

manufacturinginventorytax-compliance

May 18, 202618 min read

Form 1120-H vs. Form 1120 for HOAs: The Section 528 Election, the 60/90 Tests, and Revenue Ruling 70-604, Explained

A practical guide for HOA boards, treasurers, and small-firm CPAs on the Section 528 election, the four Form 1120-H eligibility tests, the 30% flat rate trade-off versus Form 1120, and why every association should record an annual Revenue Ruling 70-604 vote.

Mike Thrift

taxtax-compliancetax-preparation

May 18, 202615 min read

IRS Office of Appeals and Audit Reconsideration: How Small Businesses Fight an Audit Without Going to Tax Court

A small business guide to resolving IRS audit disputes without litigation — the 30-day letter, Form 12203 Small Case Request, formal written protest, Fast Track Settlement, audit reconsideration, and the 90-day statutory notice of deficiency.

Mike Thrift

taxauditirs-reporting

May 18, 202614 min read

Mobile Notary and Loan Signing Agent Bookkeeping: Separating SE-Tax-Exempt Notarial Fees on Schedule C and Schedule SE

Mobile notaries and loan signing agents can exclude statutory notarial fees from self-employment tax under IRC Section 1402(c)(1), but only if their books cleanly split per-act notarial revenue from taxable signing, travel, and print fees. A chart-of-accounts and Schedule C/SE walk-through that can save a moderately busy LSA $800 to $2,000 a year.

Mike Thrift

self-employment-taxbookkeepingtax-deductions

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