Diapoules & Feinstein CPAs P.C. Responds to the Effect of the Fiscal Cliff Deal on Small Businesses

While the new deal avoided hitting the so-called fiscal cliff, a recent article from Forbes claims there is both good and bad news for small businesses.

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Bohemia, NY (PRWEB) January 10, 2013

On January 10, Diapoules & Feinstein CPAs P.C. responds to the effect the recent deal to avoid the fiscal cliff will have on small businesses across America.

The good news is that there will be greater certainty in taxes, and while some may not like the implication of this tax certainty, many consider it to be a factor that will help lift the overall economy. An article from Forbes states that “the tax deal makes permanent a number of tax provisions (after making changes from current 2012 policy), including the tax rates on ordinary income; estate tax; dividends and capital gains – and best of all, the alternative minimum tax.”

The article went on to say that “on AMT the current exemption of $33,750 individual and $45,000 married is increased to $50,600 single and $78,750 married and indexes the exemption and phaseout amounts.”

Another important benefit that resulted from the deal is IC-DISC, which benefits exporters. According to Forbes, it allows exporters to get dividend tax treatment on what would otherwise be ordinary income. The article urges all small business owners who qualify to take advantage of IC-DISC.

There were also some tax increases, especially on capital gains, dividends and estate taxes – the latter being of especially high concern for business owners. “The $5 million dollar per person exemption was kept in place (and indexed for inflation continued) however the top rate is increased to 40 percent – effective date January 1, 2013,” the article stated.

CPA Jim Diapoules, who regularly deals with tax audits, responded to the article by stating, “As many businesses are now aware of, by passing the American Taxpayer Relief Act of 2012, Congress has let stand a number of expiring tax benefits that would have adversely affected them if the act had not been passed. Current tax rules and conditions are not much different in 2013 as they were in 2012. The article is correct in advising exporters to look over their operations and discuss with their accountants to see if the formation of IC-DISC corporation will be advantageous to them and result in significant tax savings.”

Diapoules & Feinstein CPAs P.C. have been providing accounting, auditing and tax services to Greater New York City area since 1989. D&F provides our clients with great personal attention and years of professional experience in order to see them succeed and help them to feel confident.

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