Volume 2 Issue 5
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Can the Corporate Veil Be Pierced?
There are several possible reasons why you might incorporate a business. One of the main advantages unrelated to taxes is the protection of the “corporate veil” (also known as the “corporate shield”). Under this basic principle of law, a business owner cannot be held personally liable for the debts and obligations of the corporation. Nevertheless, be aware that the corporate shield is far from invincible.
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Important Changes to FDIC Insurance Coverage
Due to pending expiration of the Dodd-Frank Deposit Insurance provision, the FDIC will no longer provide unlimited insurance coverage for noninterest bearing bank accounts as of December 31, 2012. As of January 1, 2013, Insurance limits will revert back to only providing $250,000 of coverage for each ownership category, at each financial institution.
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IRS Adjusts Retirement Plan Limits
The IRS recently released its annual cost-of-living adjustments for certain retirement plan thresholds in 2013. Although inflation has remained on the low side, several key limits have been bumped up, as shown below. However, note that other limits did not change.
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Facing Up to the AMT Threat
The “alternative minimum tax” (AMT) should not catch anybody by surprise anymore. This so-called stealth tax, which was initially aimed at only the highest echelon of individual taxpayers, continues to ensnare millions of taxpayers in both the middle and upper classes each year. If you are in the danger zone, you have probably come to expect the AMT threat at tax return time.
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Glad Tidings for Year-end Gifts
Due to recent tax law changes, you may want to give generous gifts to family members this holiday season. The gifts can reduce the size of your taxable estate. Here is a brief overview of the basic tax rules.
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