Articles From Lumsden McCormick

The article provides a comprehensive guide for employers on managing taxes and tips for service workers. It covers the current status of tip taxation, defines tips for tax purposes, outlines criteria for tip classification, and details employer responsibilities and record-keeping requirements.

A donor-advised fund (DAF) is a flexible tool for charitable giving that allows you to allocate funds during your lifetime and direct donations over time. It can be established with an initial contribution, managed by a financial institution, and offers tax benefits while ensuring your charitable legacy continues after your death.

Nonprofits can manage financial uncertainties by building and maintaining operating reserves. Key steps include establishing a written reserves policy, identifying windfalls and budget items, and enlisting support from the board and leadership team.

Lumsden McCormick has released its annual Federal Tax Rate Guide.

For 2025, many business tax limits have increased due to inflation adjustments. Key changes include higher limits for Section 179 expensing, standard mileage rates, and various retirement plan contributions.

Manufacturers are increasingly integrating advanced technologies like IIoT, robotics, and automation, which makes cybersecurity more critical than ever. The convergence of IT and OT systems presents unique cybersecurity issues, and manufacturers must adopt robust cybersecurity frameworks, conduct risk assessments, and prioritize employee training to mitigate risks.

When planning your estate, leaving specific assets to specific heirs might seem like a good idea, but it can lead to unintended consequences. For example, changes in asset values over time can result in unequal distributions among heirs, potentially disinheriting some family members. To avoid such outcomes, consider distributing your wealth based on percentages or dollar values rather than specific assets.

Cost allocation procedures for nonprofit organizations are necessary to comply with GAAP standards and provide transparency to donors and funders. It outlines the need to analyze expenses by nature and function, categorize supporting activities, and disclose the methods used for expense allocation. Proper cost allocation ensures accurate financial reporting and helps nonprofits manage their resources effectively.

Relocating a trust to a state with low or no income taxes can offer significant tax advantages, especially for irrevocable, non-grantor trusts that accumulate substantial income.

Charitable fundraisers featuring games of chance, such as bingo, raffles, baccarat, and roulette, are popular ways for nonprofits to raise money. However, hosting gambling events comes with certain tax-related responsibilities, including reporting participant winnings and ensuring compliance with IRS rules and state regulations. To remain compliant, nonprofits should plan accordingly.