Purpose in Every Detail: How Our Gift Box Reflects Our Larger Mission

When we designed our client gift box, we wanted it to be more than a thoughtful gesture; we wanted it to embody the same intentionality that drives our work at JCox CPAs & Advisors, P.C. Every detail, down to the box itself, was chosen with care. The box doubles as a practical storage solution, giving clients a dedicated place to collect receipts, invoices, and important documents as they go about their busy lives.

Our goal was simple: to help clients stay organized and focused on running their businesses, without the added stress of clutter or misplaced paperwork. Too often, valuable time and energy are lost in the search for missing documents when it matters most. By offering a tool as simple as this box, we provide clients with peace of mind, knowing everything they need is in one place. And when tax season or financial planning comes around, this intentional design pays off even more. Clients can simply request a pickup of their documents, confident that their records are already gathered, secure, and ready for review.

The Meaning Behind Each Client Gift

Each item inside the gift box was selected with the purpose of reflecting not only practicality but also the values of our firm:

• JCox Notebook – A place for clients to jot down thoughts, goals, or meeting notes, serving as a reminder that clear planning leads to clear results.

•  JCox Dual USB/USB-C Flash Drive – A modern tool that makes it easy to back up and share files, symbolizing how we bridge traditional accounting with today’s digital demands.

•  JCox Flask Bottle – A reminder to stay refreshed and take care of one’s health, because running a business requires balance as much as it requires effort.

•  JCox Pen & Sticky Notes – Simple, everyday tools to capture ideas and track reminders, reinforcing our belief that no detail is too small when it comes to success.

•  JCox Tote Bag – A practical, reusable way to carry materials, representing our commitment to sustainability and providing clients with resources they can use beyond the office.

Together, these items serve as a toolkit for staying organized, connected, and prepared. They are not just branded tokens; they are a reflection of our values: commitment, engagement, and responsiveness. From keeping receipts in the gift box to saving files on the flash drive or carrying essentials in the tote, each piece was chosen to support our clients in meaningful, practical ways.

One of our clients, Bryce Crawford [1], has found the JCox power bank to be an essential tool. As he travels across states sharing the gospel through street evangelism and social media, Bryce uses the power bank to keep his devices charged and his ministry connected. What may seem like a simple gift serves a greater purpose, supporting his mission to bring the hope and love of Jesus to communities everywhere.

At JCox CPAs & Advisors, P.C., even the smallest details are designed with purpose. Just as our professional services are tailored to help clients succeed, our client gift box is a tangible reminder that we are here to walk alongside them every step of the way.

JCox Partnership Alliance: Gifts as a Reflection of Our Commitment

When we designed our client gift box, we wanted it to represent more than appreciation. It was created with purpose, giving clients practical tools to stay organized, connected, and prepared. In the same way, our broader mission at JCox CPAs & Advisors, P.C. is to design solutions, not just for individuals, but also through the partnerships we build.

Just as we are intentional in financial reporting, tax strategy, and advisory, we are intentional in how we honor and strengthen our partnership alliance. Our gifts represent a small but meaningful way of saying that at JCox, we view every partnership as a true alliance, one designed to create lasting impact for both our collaborators and the clients we serve together.

Over the past two years, we have taken intentional steps to form partnerships that create greater value and peace of mind for our clients. These partnerships extend the same thoughtfulness we put into our gifts into the way we serve on a larger scale.

Here are some of the key initiatives we’ve developed:

• Partnering with local CPA firms to provide specialized expertise for complex client engagements. This allows us to collaborate and ensure that no challenge is too large for our clients to navigate.

• Partnering with law firms through our JCox Legal Concierge [2] initiative, offering clients access to attorneys in areas such as business litigation, business transactions, and family matters.

• Partnering with wealth management firms to help clients plan for the future with confidence, providing holistic guidance on everything from retirement planning to asset protection.

• Partnering with technology leaders to enhance accounting processes, streamline payroll, and strengthen financial reporting. These collaborations allow us to integrate advanced tools directly into our clients’ businesses, improving accuracy, efficiency, and real-time insights.

Together, these partnerships create a one-stop platform for our clients, a place where accounting, advisory, tax, legal, and wealth management needs are not separate hurdles but part of one seamless experience.

At the heart of everything we do is a commitment to serve clients not just with financial expertise, but with tools, partnerships, and experiences that create clarity and peace of mind. From the smallest details to the largest collaborations, we strive to ensure that our work is purposeful, practical, and deeply rooted in values that stand the test of time.

We are grateful for the trust our clients place in us and for the partnerships that make our work possible. At JCox CPAs & Advisors, P.C., every relationship matters. Whether you are a client, a partner, or a future collaborator, we thank you for walking with us as we continue building purposeful solutions, grounded in values that last.

[1] Bryce Crawford is the Founder and CEO of Jesus in the Street, Inc., a 501(c)(3) Christian nonprofit dedicated to sharing the gospel through social media and street evangelism. After a transformative personal experience, Bryce committed his life to bringing the hope, light, and love of Jesus to urban communities and marginalized individuals. As a Gen Z influencer, he leverages digital platforms alongside in-person ministry to connect with diverse audiences, offering encouragement, biblical truth, and practical hope. His unique approach allows him to bridge generational gaps, using both technology and grassroots outreach to advance the mission of Christ. His Instagram @brycecrawford his other social media links: brycecrawfordministries  ilovejesus

[2] Details coming soon.

2025 Tax Filing Season: Get Paid to Switch

At JCox CPAs & Advisors, P.C., we’re making it easier than ever to switch from H&R Block, Jackson Hewitt, or TurboTax — and we’re willing to pay you to do it.

When you join us this tax season, not only will you receive expert, personalized tax preparation, but you’ll also:

Get Paid to Switch

We’ll credit you just for leaving H&R Block, Jackson Hewitt, or TurboTax and bringing your tax needs to JCox CPAs & Advisors, P.C. Your transition will be smooth, simple, and stress-free.

2-Year Price Lock Guarantee

Your tax preparation fee will be locked in for two full years. No surprise price hikes — just consistent, transparent pricing you can count on.

Experienced, Licensed Professionals

Unlike large retail chains or do-it-yourself software, your taxes are prepared by licensed professionals with deep expertise in both individual and business tax strategies. You’ll receive customized planning to maximize deductions, credits, and long-term tax savings.

Why Choose JCox CPAs & Advisors, P.C.?

• Personalized Service – We know your name, your goals, and your story.

• Free Personalized Tax Planning – We go beyond filing to create strategies that save you money now and in the future.

• Free Mid-Year Tax Update & Planning – A proactive review to adjust your tax strategies and keep you on track before year-end.

• Free Year-Round Support – We’re here for your tax questions any time of year, not just during filing season.

How to Get Started

1. Contact Us – Call/Text 404-775-8960 or email ncox@jcoxcpa.org.

2. Provide Your Last Tax Return – Bring or upload your prior-year 2024 and 2023 return from H&R Block, Jackson Hewitt, or TurboTax.

3. Lock in Your Rate & Claim Your Switch Credit – We’ll handle the rest.

Compare 2025 Software Costs for H&R Block, Jackson Hewitt, and TurboTax — and see how much we’ll pay you to switch to us!

One Big Beautiful Bill Signed into Law: A Comprehensive Analysis

On July 4, 2025, President Donald Trump signed into law the One Big Beautiful Bill (OBBB), following a razor-thin 51–50 Senate vote, where Vice President J.D. Vance cast the decisive tie-breaker. This landmark legislation, which largely reflects the Senate’s version previously approved by the House of Representatives, represents one of the most significant tax and spending reforms enacted in recent years.

The bill’s breadth spans extensions of the Tax Cuts and Jobs Act (TCJA) provisions, targeted new tax breaks, alterations to social safety nets, and increased government spending in defense and immigration enforcement. For tax professionals, policymakers, and taxpayers, a detailed understanding of the bill’s provisions, along with their underpinning Internal Revenue Code (IRC) references, is critical to strategic tax planning and compliance.

I. Extension and Enhancement of TCJA Tax Provisions

Sections 101 and related provisions of the OBBB permanently extend critical components of the TCJA through 2028, preventing the expiration of several popular tax breaks. Key among these are:

• Individual and Corporate Income Tax Rates (IRC § 1): The marginal income tax rates for individuals and corporations remain at the lower levels established by the TCJA. This continuation provides stability and certainty for taxpayers facing planning decisions.

• Qualified Business Income Deduction (IRC § 199A): The 20% pass-through deduction remains in place, benefiting millions of small business owners and professionals organized as sole proprietors, partnerships, S-corporations, or certain trusts and estates.

II. Exclusion of Tips and Overtime from Gross Income (IRC § 61(a))

One of the most transformative provisions is found in Section 102 of the bill, which excludes tips and overtime pay from gross income for eligible taxpayers, modifying the broad gross income definition in IRC § 61(a). This provision marks a historic shift aimed at reducing tax burdens on service and hourly wage workers.

A. IRC § 61(a) Background

Under current tax law, IRC § 61(a) defines gross income as “all income from whatever source derived,” including wages, tips, and other compensation for services. Generally, tips and overtime wages are fully taxable.

B. Eligibility Criteria for the Exclusion

• Income Thresholds: The exclusion applies to taxpayers with modified adjusted gross income (MAGI) under $100,000 for single filers and under $200,000 for married joint filers. MAGI is calculated in accordance with IRC § 7702B and § 63 definitions, ensuring consistency in income measurement.

• Employment Sectors: Though not explicitly limited by sector in the bill, this provision principally benefits service industry employees, such as those in hospitality, restaurants, retail, and other tip-earning roles.

• Reporting Requirements: Taxpayers must still report their tips and overtime pay accurately through payroll documentation, consistent with IRS Form W-2 reporting.

• Effective Dates: This exclusion applies for tax years 2025 through 2028, after which standard taxation rules will resume unless further extended by Congress.

C. Implications

This tax relief offers a meaningful increase in take-home pay for millions, helping lower- and middle-income earners without disrupting payroll withholding or Social Security and Medicare tax obligations.

III. Senior Tax Relief: $6,000 Deduction for Age 65+ (Section 103)

The OBBB introduces a new $6,000 deduction targeted at taxpayers aged 65 or older, effective 2025 through 2028. This deduction is codified as an amendment to IRC § 63, which governs itemized and standard deductions.

• Income Thresholds: Applies to taxpayers with MAGI below $75,000 for single filers and $150,000 for married joint filers.

• Purpose: Provides additional tax relief to seniors, many of whom live on fixed incomes and face escalating healthcare and living expenses.

• Temporary Nature: The deduction is scheduled to sunset after 2028 unless Congress acts to extend it.

This deduction supplements existing age-related tax credits and deductions, such as the additional standard deduction amount for seniors under IRC § 63(c)(1)(B).

IV. State and Local Tax (SALT) Deduction Cap Revisions (Section 104)

The SALT deduction cap remains a hot-button issue under IRC § 164(b)(6). The TCJA had limited the SALT deduction to a maximum of $10,000 annually.

A. OBBB Changes

• Raises the SALT deduction cap to $40,000 for taxpayers with incomes below $500,000.

• Caps the increase to 1% annual growth from 2025 to 2029, after which the cap reverts to $10,000.

• Phases out the SALT deduction for taxpayers earning over $500,000, increasing the threshold by 1% annually.

B. Rationale and Impact

This expanded cap primarily benefits taxpayers in high-tax states (California, New York, New Jersey), alleviating some tax burdens but raising concerns about federal revenue impacts.

V. Child Tax Credit (CTC) Enhancements (Section 105)

The Child Tax Credit, under IRC § 24, receives permanent enhancements:

• Credit Amount: Increased to $2,200 per qualifying child, indexed annually for inflation.

• Eligibility: Requires valid Social Security Numbers for both the child and the taxpayer claiming the credit to strengthen anti-fraud measures.

• Income Phaseouts: Maintains higher thresholds to retain benefits for middle-income families.

• Duration: This structure is permanent, ensuring long-term support for families.

VI. Medicaid and SNAP Reforms (Section 106)

Reflecting a policy shift, the OBBB imposes:

• Work Requirements: Medicaid recipients aged 19 to 64 with dependent children over 14 must work or engage in qualifying activities for at least 80 hours per month.

• Funding Reductions: Cuts funding for Medicaid and SNAP programs, with estimates projecting over 10 million Americans could lose health insurance by 2034.

VII. Defense and Immigration Enforcement Funding (Section 107)

The bill appropriates:

• $150 Billion for Defense Modernization: Including funding for the new “Golden Dome” missile defense system.

• $170 Billion for Immigration Enforcement: $45 billion specifically allocated to Immigration and Customs Enforcement (ICE) for detention and related operations.

VIII. Environmental and Energy Policy Rollbacks (Section 108)

The OBBB rolls back several clean energy tax credits and incentives, reversing earlier federal support under IRC §§ 45, 48, and related provisions.

• A new tax is imposed on university endowments exceeding certain thresholds.

• These policy changes may affect renewable energy investments and academic funding structures.

IX. Fiscal Considerations (Section 109)

The bill increases the federal debt ceiling by $5 trillion to accommodate expanded spending.

• The Congressional Budget Office estimates the OBBB will add approximately $2.8 trillion to the national debt over the next decade.

Source: H.R.1 - One Big Beautiful Bill Act

Mid-Year Tax Planning Guide 2025: Why Planning Beats Panic

As we approach the second half of 2025, the importance of tax planning for small to middle-class families has never been clearer. Recent legislative changes, inflation adjustments, and IRS enforcement trends underscore the value of early, strategic action. At JCox CPAs & Advisors, P.C., we believe proactive tax planning should be the norm, not the exception.

Why Be Proactive With Tax Planning?

Many taxpayers are familiar with tax preparation: the annual ritual of entering figures into software or handing paperwork to a preparer, then hoping for a refund or bracing for a bill. This process, while necessary, is reactive.

Tax planning is different. It's forward-looking. Rather than waiting until the end of the year, tax planning involves consistently evaluating your income, deductions, and credits throughout the year to ensure you're making smart decisions along the way. Whether you explore strategies on your own or work with a qualified tax advisor, planning in advance reduces surprises, identifies savings, and improves overall financial health.

Exclusive Offer: Tax Return Review + Free Mid-Year Planning

Did you file your 2024 tax return yourself or through another provider? JCox CPAs & Advisors is offering:

• A detailed review of your 2024 tax return

• A 40% discount on any necessary amended return

• A complimentary mid-year 2025 tax planning session

We’ll help determine whether adjustments are needed and build a custom plan for the rest of the year, so you’re not caught off guard come filing season.

Key Legislative Changes and Relevant IRC Sections

1. Standard Deduction Increase – IRC §63(c)

The standard deduction for 2025 has increased to $30,000 for married couples filing jointly and $15,000 for single filers. This simplifies filing and reduces taxable income for many families, potentially eliminating the need to itemize deductions.

2. Updated Child Tax Credit – IRC §24

The Child Tax Credit has increased to $2,500 per qualifying child. However, income thresholds have been updated, and eligibility is now subject to tighter rules. A mid-year review helps determine whether you're maximizing your credit opportunities.

3. Raised SALT Deduction Cap – IRC §164(b)(6)

Taxpayers with adjusted gross income under $500,000 can now deduct up to $40,000 in state and local taxes. This may revive itemized deductions for those in high-tax states, especially when paired with mortgage interest or charitable contributions.

4. Tip and Overtime Income Relief – IRC §62(a)

New legislation now allows deductions for reported tip income and qualified overtime under above-the-line adjustments. This change benefits hourly and service industry workers who often face higher effective tax rates on variable income.

5. Estimated Payments and Withholding – IRC §6654 and §3402

Now is the time to review your W-4 or calculate estimated taxes to avoid underpayment penalties. Mid-year is ideal for making course corrections based on expected year-end income.

6. Retirement Planning Opportunities – IRC §219 and §414(v)

Contributions to IRAs and 401(k)s can reduce taxable income while securing your future. Catch-up contributions for taxpayers aged 50+ allow additional savings. Planning ahead helps ensure contribution deadlines aren't missed.

7. Business Owners: Optimize Now – IRC §179 and §199A

Self-employed individuals and pass-through entities should evaluate:

• Equipment purchases for IRC §179 deductions

• Compensation and qualified income for the 20% QBI deduction under IRC §199A

These choices can significantly reduce your overall tax bill, but require proper planning before year-end.

8. Estate and Gift Strategies – IRC §2503 and §2010

Annual gift exclusions remain at $18,000 per recipient. The elevated lifetime exemption under IRC §2010 remains available through 2025, but is set to sunset. Planning now ensures your wealth transfer strategy is optimized before potential changes take effect.

Final Thoughts: Plan With Purpose by Connecting With Us Today

Tax planning is not just about minimizing taxes—it’s about building financial resilience. The sooner you identify opportunities, the more leverage you have to act. Let’s make 2025 the year you lead your finances, not follow your filing.

Connect with JCox CPAs & Advisors today to get started with your custom mid-year strategy.

Schedule your meeting here

How Stepped-Up Basis Reduces Inheritance Taxes

When families pass down wealth, whether through real estate, investments, or business interests, few things are more important than understanding how taxes will apply. And here's the good news: the IRS gives heirs a major break through what's called the stepped-up basis rule.

At JCox CPAs & Advisors, we specialize in strategies that preserve your legacy and keep taxes in check. Let’s walk through what a stepped-up basis is, how it works, and why it could save your family thousands—maybe even hundreds of thousands—in capital gains tax.

What Is a Stepped-Up Basis?

Under IRC §1014, when you inherit an asset, the IRS allows you to "step up" the basis (i.e., the starting value used for calculating taxes) to the fair market value (FMV) on the date of death.

That means if your loved one bought a property for $200,000, worth $800,000 when they pass away, your new basis is $800,000. So, if you later sell it for $850,000, you only pay tax on the $50,000 gain, not the $650,000 gain.

This is huge for avoiding unnecessary capital gains tax.

Why It Matters Now More Than Ever

In 2025, the federal estate and gift tax exemption is set at $13.99 million (IRC §2010(c)). While that covers most estates, capital gains taxes still apply to many inherited assets when they’re sold.

Without proper planning, heirs can get hit hard.

A Real-World Example From JCox

Let’s look at how this works in action:

One of our long-time clients at JCox CPAs Advisors, P.C., purchased a commercial property in Grayson, GA, in 1999 for $350,000. By the time they passed away in 2024, the property had appreciated by $1.2 million.

The heir—his son—sold the property in 2026 for $1.35 million.

Thanks to the stepped-up basis, he only paid tax on the $150,000 gain ($1.35M - $1.2M), not the full $1 million gain from the original cost basis.
Result: He paid around $30,000 in capital gains tax instead of $200,000. That’s a $170,000 tax savings.

What Assets Qualify?

The stepped-up basis applies to a variety of inherited property, including:

• Real estate

• Stocks and mutual funds

• Business interests

• Art collectibles

• Bank and investment accounts

However, retirement accounts like IRAs or 401(k)s are excluded under IRC §1014(c). These are taxed as ordinary income to the beneficiary upon withdrawal.

What If the Asset Drops in Value?

Here’s another twist: if the inherited asset lost value before the date of death, the step-up works in your favor, too. The basis is adjusted downward to FMV, so if the value later rises and you sell, the gain is only calculated from that adjusted point.

That said, if it keeps falling, you might even have a capital loss, which can help offset gains from other investments.

Final Thoughts: Legacy Protection That’s Smart and Strategic

At JCox CPAs & Advisors, P.C., we believe your legacy should be passed down, not taxed away. Whether you’re updating your estate plan or navigating a recent inheritance, knowing how the stepped-up basis works can protect your wealth for the next generation.

Office Closure April 16–25, 2025

Valued Clients,

We are grateful for your continued trust and partnership throughout another successful tax season. To provide our dedicated staff and contractors with a much-needed rest following the busy season, please be advised that our office will be closed from Wednesday, April 16, 2025, through Friday, April 28, 2025.

We will reopen and resume normal operations on Monday, April 28, 2025. During this period, responses to emails and messages may be delayed until we return.

Thank you for your understanding and continued support. We look forward to serving you refreshed and energized upon our return.

JCox Extends Office Hours for Tax Season!

At JCox CPAs & Advisors, P.C., we are committed to providing top-tier service during tax season. Due to an increase in the volume of tax preparation and advisory requests, we are extending our office hours—effective immediately through April 15, 2025, at 5:00 PM—to ensure every client receives the timely and professional attention they deserve.

Starting immediately, our office will be open during the following extended hours:

Monday – Saturday: 8:00 AM – 8:00 PM
Sunday: 8:00 AM – 3:00 PM

This temporary extension allows us to better accommodate your busy schedule while ensuring we meet all filing deadlines efficiently.

For questions or to schedule an appointment, call us at (404) 775-8960 or email ncox@jcoxcpa.org.

Thank you for trusting JCox CPAs & Advisors, P.C. with your tax and financial needs—we look forward to serving you this tax season!

Tax Filing & Refund Dates: What to Expect

At JCox CPAs & Advisors, P.C., we pride ourselves on delivering efficient and accurate tax preparation services.

Our current turnaround times are as follows:

• Individual Income Tax Returns: 3 days

• Partnerships, C-Corporations, and S-Corporations: 4 days

These timeframes encompass thorough review and quality control processes, ensuring that your tax filings are both prompt and precise.

Understanding the timeline for receiving your tax refund is crucial for financial planning. The IRS typically issues refunds within 10 to 21 days after accepting an electronically filed return. However, several factors can influence this timeline, including the date of filing, the method of filing (e-file or paper), and the specific credits claimed.

To provide a clearer picture, here's an estimated timeline for 2024 tax refunds based on the IRS acceptance date of your e-filed return:

Note: Returns claiming the Earned Income Tax Credit (EITC) or Additional Child Tax Credit (ACTC) may experience delays until March to verify credits. Filing during peak season (late March through April 15) can also result in slightly longer waits.

TAX TIME!

Tax Filing Season officially begins on January 27th, 2025, when the IRS will start accepting returns. Whether you’re an individual or a business owner, ensuring your taxes are filed accurately and on time is crucial to avoid penalties and maximize potential refunds. At JCox CPAs & Advisors, P.C., we’re here to make your tax season stress-free and successful.

Why Tax Filing Matters

Tax season is a critical time of year for everyone. Filing your taxes properly ensures that you remain compliant with federal and state laws while also giving you the opportunity to uncover valuable deductions and credits that could save you money. However, navigating tax laws can be overwhelming and complex—especially with the ever-changing regulations.

This is where our expertise comes in. At JCox CPAs & Advisors, we bring years of professional experience and personalized service to the table, helping you make the most of your financial situation. Our licensed team works diligently to ensure accuracy and efficiency, leaving no deduction or credit overlooked.

How JCox Can Help You This Tax Season

At JCox CPAs & Advisors, we offer a full range of tax services to meet your unique needs. Here’s what you can expect:

1. Expert Tax Preparation: From individuals to businesses, we handle tax filings of all types and complexities. Our team stays up to date on the latest tax laws and regulations to ensure compliance and accuracy.

2. Strategic Tax Planning: Don’t just prepare your taxes—plan for them. We offer proactive tax planning strategies to help you minimize your tax liability and maximize your savings for the future.

3. Personalized Support: Every client is unique, and so is our approach. We’ll take the time to understand your financial situation and goals, providing tailored solutions that work for you.

4. Year-Round Assistance: Tax season might be seasonal, but our support is not. Whether you need help with IRS inquiries, audits, or financial planning, we’re here for you all year long.

Why Choose JCox CPAs & Advisors?

Choosing the right CPA firm can make all the difference during tax season. At JCox, we pride ourselves on being committed, engaged, and responsive to every client’s needs. Our professional team works with precision and care to ensure that your taxes are done right—the first time.

Additionally, we’re offering a 30% discount on all services for the first year to new clients who make the switch to JCox. Don’t wait until the last minute to get started; the earlier you begin, the smoother the process will be.

Get Started Today

The clock is ticking, and tax deadlines will be here before you know it. Don’t let procrastination lead to unnecessary stress or missed opportunities. Schedule your appointment with JCox CPAs & Advisors, P.C. today, and let us take the worry out of tax season by visiting us at jcoxcpa.org!

Contact us at ncox@jcoxcpa.org or call us at 404-775-8960 to get started.

Get Prepared for Tax Filing 2024!

Here are some essential steps to help you get prepared:

1. Gather Your Documents:

• W-2s, 1099s, or other income statements

• Business expense records if you're self-employed

• Mortgage interest statements

• Proof of charitable donations

• Health insurance documentation

2. Review Last Year's Return:

• Look over your prior year’s tax return to ensure you don't miss any carryovers (e.g., deductions or credits) and to identify any possible changes.

3. Plan for Deductions & Credits:

• Don't forget about possible deductions for things like student loans, retirement contributions, or education expenses.

• Consider tax credits like the Child Tax Credit or Earned Income Tax Credit.

4. Track Any Life Changes:

• Changes like getting married, having a baby, or buying a home could affect your tax situation. Make sure you account for these.

5. Set Up Your Tax Payment Plan:

• Estimate if you will owe taxes and start setting aside money now, or adjust your withholdings to avoid surprises.

6. Consider Professional Help:

• Tax laws are always changing, and getting professional advice ensures you don’t miss out on any savings or deductions you may qualify for.

Don't wait until the last minute! Plan ahead to ensure a smooth and stress-free tax season. If you need help getting started, reach out to us at JCox CPAs & Advisors! We’re here to make your tax filing easy and efficient.

A Comprehensive Guide for Sole Proprietors on Paying Quarterly Estimated Taxes

Understanding Sole Proprietorship

A sole proprietorship is the simplest and most common form of business structure. It is owned and operated by a single individual, meaning there is no legal distinction between the owner and the business. This structure offers full control to the owner and allows for simple tax reporting. However, it also means that the owner is personally liable for all debts and obligations of the business.

As a sole proprietor, you report your business income and expenses on your personal tax return, specifically using Schedule C (Form 1040). This form allows you to detail your profits and losses from your business activities.

Why Pay Estimated Taxes?

The IRS requires taxpayers, including sole proprietors, to pay estimated taxes if they expect to owe $1,000 or more in tax for the year. This is essential because sole proprietors typically do not have taxes withheld from their business income, unlike employees who have taxes withheld from their paychecks.

Steps for Paying Quarterly Estimated Taxes

1. Determine Your Tax Liability: Calculate your expected adjusted gross income (AGI), taxable income, taxes, credits, and other payments for the year.

2. Use IRS Form 1040-ES: Form 1040-ES is used for estimating your tax payments. It includes a worksheet to help you estimate your taxable income and tax liability.

3. Calculate Quarterly Payments: Divide your estimated tax liability by four to determine your quarterly payment amount.

4. Know the Due Dates: Estimated tax payments for sole proprietors are typically due on the following schedule:
   - First Quarter: April 15
   - Second Quarter: June 15
   - Third Quarter: September 15
   - Fourth Quarter: January 15 of the following year

5. Make Your Payments: Payments can be made electronically through the IRS Direct Pay system, or you can send a check or money order along with the payment voucher from Form 1040-ES.

6. Keep Accurate Records: Maintain accurate records of your income and expenses throughout the year.

Relevant Tax Codes and Forms

- Federal Forms:
  - Form 1040: U.S. Individual Income Tax Return, which includes income from your sole proprietorship.
  - Schedule C (Form 1040): Profit or Loss from Business, where you report your business income and expenses.
  - Form 1040-ES: Estimated Tax for Individuals.

- Georgia State Forms:
  - Form 500: Georgia Individual Income Tax Return, used to report income, deductions, and credits for state tax purposes.
  - Form 500-ES: Georgia Estimated Tax Payment Coupon, which is used to make estimated tax payments to the state.

Caution

The examples provided (below) assume that the sole proprietor is a Georgia resident who is a single filler. Tax laws and rates can vary significantly by state, so it’s essential to consult local regulations or reach out to JCox CPAs & Advisors, P.C. if you're operating outside of Georgia.

Example Breakdown

Example Scenario

- Total Expected Income for the Year: $50,000
- Total Expected Business Expenses: $15,000
- Filing Status: Single
- Standard Deduction for the Year: $13,850 (for 2023)

Step 1: Calculate Federal Tax Liability

1. Calculate Net Income:
   Net Income = Total Income - Total Expenses
   Net Income = 50,000 - 15,000 = 35,000

2. Adjust for Standard Deduction:
   Taxable Income = Net Income - Standard Deduction
   Taxable Income = 35,000 - 13,850 = 21,150

3. Apply Federal Tax Rates:
   The 2023 federal income tax brackets for a single filer are as follows:
   - 10% on income up to $11,000
   - 12% on income over $11,000 up to $44,725

   Calculate Tax:
   - First $11,000: 11,000 × 0.10 = 1,100
   - Remaining income ($21,150 - $11,000 = $10,150): 10,150 × 0.12 = 1,218
   - Total Federal Tax Liability: 1,100 + 1,218 = 2,318

4. Calculate Quarterly Payments:
   Quarterly Federal Estimated Tax Payment = Total Tax Liability / 4
   Quarterly Federal Estimated Tax Payment = 2,318 / 4 = 579.50

Step 2: Calculate Georgia State Tax Liability

1. Apply Georgia Tax Rates:
   Georgia uses a similar tax bracket system. The 2023 tax brackets for a single filer are:
   - 0% on income up to $750
   - 1% on income from $751 to $2,250
   - 2% on income from $2,251 to $3,750
   - 3% on income from $3,751 to $5,250
   - 4% on income from $5,251 to $7,000
   - 5% on income from $7,001 to $10,000
   - 5.75% on income over $10,000

2. Calculate Georgia Tax:
   Calculate Tax:
   - First $750: 750 × 0.00 = 0
   - From $751 to $2,250: (2,250 - 750) × 0.01 = 15
   - From $2,251 to $3,750: (3,750 - 2,250) × 0.02 = 30
   - From $3,751 to $5,250: (5,250 - 3,750) × 0.03 = 45
   - From $5,251 to $7,000: (7,000 - 5,250) × 0.04 = 70
   - From $7,001 to $10,000: (10,000 - 7,000) × 0.05 = 150
   - Over $10,000: (21,150 - 10,000) × 0.0575 = 643.75

  Total Georgia State Tax Liability:
   0 + 15 + 30 + 45 + 70 + 150 + 643.75 = 953.75

3. Calculate Quarterly Payments:
   Quarterly Georgia Estimated Tax Payment = Total Tax Liability / 4
   Quarterly Georgia Estimated Tax Payment = 953.75 / 4 = 238.44

Summary of Estimated Tax Payments

- Total Federal Tax Liability: $2,318
- Quarterly Federal Estimated Tax Payment: $579.50
- Total Georgia State Tax Liability: $953.75
- Quarterly Georgia Estimated Tax Payment: $238.44

Fundamentals of Small Business Bookkeeping

Accurate financial management is essential for small business success because it facilitates compliance and allows for growth tracking. The tax experts at JCox CPAs & Advisors, P.C. have put together this concise guide with crucial bookkeeping advice for small business owners.

Keep personal and business finances apart.

Establishing a specific bank account and credit card for business use only is one of the first steps in preparing your company for financial clarity. By keeping personal and business transactions apart, this makes filing taxes easier and reduces issues in the case of an IRS audit. This division is essential for accurate financial reporting for all business entities other than sole proprietorships.

Use Automation to Simplify Accounts Payable

Managing bills and invoices can be made easier with a trustworthy tool like Bill.com. With its integration with QuickBooks, it streamlines your accounts payable and receivable procedures and provides safe payment methods such as international wire transfers, credit cards, checks, and ACH transfers. Automating these processes with digital tools reduces errors, saves time, and aids in maintaining vendor payment organization.

Make Expense Tracking Digital

Keeping track of expenses for several employees can be challenging, particularly when dealing with physical receipts that are prone to being misplaced or destroyed. You can assign specific funds to team members and maintain digital records with an expense tracking tool like Divvy. Workers can upload receipt photos straight into the app, which simplifies record-keeping and improves budgetary control.

Use Financial Information to Make Strategic Choices

Your financial records are vital tools for strategic planning, not just for tax purposes. Making informed business decisions can be facilitated by routinely examining your profit and loss statements and comprehending important financial ratios, such as debt-to-equity and return on assets. Monthly or yearly analysis of these records can help identify areas for growth and cost reduction.

Get Ready for 1099 Forms in Advance

You must provide a 1099 form for independent contractors who are paid more than $600 in a single year if you work with them. Requesting a W-9 form from each contractor at the start of your working relationship will streamline this process. The last-minute rush during tax season is avoided and 1099 preparation is made simpler when their tax information is on file.

2024 Tax Proposals: A Closer Look at Trump and Harris’s Plans

Both Trump and Harris have proposed several ideas on taxes, some of which are still evolving. Here's an overview of their most significant tax proposals:

Tax Cuts and Jobs Act (TCJA) Provisions
The TCJA, which introduced lower tax rates and a larger standard deduction, will see many of its provisions expire in 2025. Trump aims to extend these cuts and potentially lower taxes further, though he hasn't provided specific details yet. Harris, who voted against the TCJA, has promised not to raise taxes for those earning less than $400,000 a year. However, to keep that promise, some TCJA tax cuts might have to stay in place. She supports raising the tax rate for high earners back to 39.6%, similar to pre-TCJA levels, and has suggested higher taxes on investment income and Medicare for those earning over $400,000.

Corporate Taxation
Trump plans to reduce the corporate tax rate to 20% and eliminate the corporate alternative minimum tax (CAMT), introduced in the Inflation Reduction Act. Harris, meanwhile, proposes increasing the corporate tax rate to 28%, and she would raise the CAMT to 21%. She also wants to increase the tax on stock buybacks and prevent large companies from writing off compensation over $1 million for top employees. Additionally, her proposal includes increasing the tax deduction for small business startup expenses from $5,000 to $50,000.

Individual Income Tax Changes
Trump suggests exempting restaurant and hospitality workers’ tips from income and payroll taxes, and he also wants to make overtime pay tax-free. However, experts warn these changes could be exploited by businesses. Harris supports exempting tips from income taxes as well but proposes safeguards to prevent employers from cutting wages in response. She also has measures to stop high earners from reclassifying their bonuses to avoid taxes. Trump has expressed interest in removing taxes on Social Security benefits as well.

Child Tax Credit
Trump's running mate, J.D. Vance, has proposed a $5,000-per-child tax credit, but Trump hasn’t officially backed it. Harris advocates for increasing the child tax credit to $3,600 for children under age six and to $3,000 for older children. She also supports expanding the Earned Income Tax Credit and healthcare subsidies for low-income families.

Capital Gains Taxation
Harris plans to tax unrealized capital gains for individuals with a net worth over $100 million, meaning they'd be taxed on the appreciation of assets they haven’t sold yet. She also wants to increase the capital gains tax for high-income earners and tax these gains at ordinary income tax rates. For those inheriting large estates, she proposes taxing unrealized gains at death, with exemptions in place for smaller estates.

The Current Housing Proposals
Trump has hinted at offering tax incentives for first-time homebuyers but hasn't given any specific details yet. In contrast, Harris has a more detailed plan, which includes down-payment assistance for families who have rented responsibly and tax incentives for builders creating affordable homes for first-time buyers.

Tariff Policies
Trump has been vocal about raising tariffs, including a standard 10% on imports, with much higher rates for products from countries like China. He has even floated the idea of replacing income taxes with tariffs, though critics argue this would increase costs for lower-income Americans.

Overall Impact
While Trump’s tax plans are estimated to add $5.8 trillion to the federal deficit over the next decade, Harris’s proposals are projected to increase it by $1.2 trillion. However, the actual impact will depend on how Congress shapes and approves these policies. Refer to the tax overview for business tax provisions and individual tax provisions outlined in more detail from sources summarized here.

Sources:

Tax Cuts and Jobs Act

Budget of the U.S. Government Fiscal Year 2025