“Businesses Must Amortize All Research and Development Expenses” MYTH — The rules have changed. For tax years 2022 through 2024, businesses generally were required to capitalize and amortize specified research and experimental expenditures. Domestic research expenditures generally required five-year amortization. Foreign research expenditures generally required fifteen-year amortization. However, federal tax legislation enacted in 2025 changed the treatment of domestic research expenditures. 💡 What's Different? For tax years beginning after December 31, 2024, IRC Section 174A generally allows businesses to deduct qualifying domestic research and experimental expenditures in the year paid or incurred. Businesses may alternatively elect certain capitalization and amortization methods. Foreign research expenditures generally remain subject to fifteen-year amortization. 📊 Example A technology company incurs: Domestic qualifying R&D expenditures: $200,000 Foreign qualifying R&D expenditures: $50,000 For 2026, the company may generally deduct the $200,000 of qualifying domestic expenditures currently. The $50,000 of foreign research expenditures generally must be capitalized and amortized over fifteen years. ⚠️ Important Distinction The deduction for research expenditures is not the same as the R&D tax credit. The credit has separate eligibility, calculation, and documentation requirements. Also, businesses with unamortized domestic research expenditures from 2022–2024 should review the applicable transition rules. 🎯 Tax-Smart Lesson A tax strategy that was correct two years ago may no longer be the best strategy today. Tax laws change. Your planning should change with them. 💬 Business Owners: Does your company develop software, improve products, or conduct technical research? You may have research expenditures worth reviewing. 📖 Source: IRS Internal Revenue Bulletin 2026-39 — Domestic Research Expenditure Guidance

Here's a practical tax-planning exercise you can complete this week. The IRS updated its Tax Withholding Estimator in March 2026 to reflect several changes under the new federal tax law. These include provisions involving: ✅ Qualified tips ✅ Qualified overtime compensation ✅ Certain vehicle loan interest ✅ The enhanced deduction for eligible seniors ✅ Family-related credits and deductions That means your current paycheck withholding may not reflect your projected 2026 tax liability. 📋 Your Workshop Assignment STEP 1 — Gather Your Information You'll need: • Your most recent pay statements. • Your latest federal income tax return. • Your spouse's pay information, if applicable. • Information about additional income, deductions, and credits. STEP 2 — Use the IRS Tax Withholding Estimator or TSWA Estimator Enter your information and review the projected federal income tax withholding for 2026. The IRS estimates that the process takes approximately 25 minutes for many taxpayers. STEP 3 — Review the Results Ask yourself: Am I withholding enough? Am I withholding significantly more than necessary? Have changes in my income or family circumstances affected my tax position? STEP 4 — Take Action If an adjustment is appropriate, the estimator can help you prepare an updated Form W-4 for your employer. 💡 Example Suppose the estimator indicates that you may be approximately $2,000 short on federal income tax withholding. If you have five pay periods remaining, an additional $400 per paycheck could help address that projected shortfall. Actual adjustments depend on your payroll schedule, projected income, and other tax payments. Self-employed taxpayers may also need to evaluate estimated-tax payments separately. 🎯 Workshop Takeaway Tax planning is more effective when you identify problems before the tax return is prepared. A 25-minute review today may prevent an unpleasant surprise next April.

If you employ people, providing childcare assistance may offer more than an employee-retention benefit. It may also create a federal tax credit. Beginning in 2026, the Employer-Provided Childcare Tax Credit under IRC Section 45F has been significantly expanded. 📊 What's New? For qualifying childcare expenditures: Previous credit rate: 25% 2026 credit rate: 40% Eligible small-business rate: 50% The maximum annual credit also increases to: 💰 $500,000 for qualifying employers 💰 $600,000 for eligible small businesses Separate qualified childcare resource and referral expenditures may generate a 10% credit. 💡 Example Assume a qualifying small business incurs $30,000 in eligible childcare facility expenditures. At the enhanced 50% rate: $30,000 × 50% = $15,000 potential tax credit. That's a meaningful incentive to explore employee childcare benefits. ⚠️ Important Considerations This credit does not automatically apply to ordinary employee daycare reimbursements. Qualifying expenditures may include operating an eligible childcare facility or contracting with a qualified childcare provider to serve employees. Employers must satisfy specific requirements involving facility qualifications, employee access, nondiscrimination, and documentation. The IRS also prohibits claiming another deduction or credit for the portion of expenditures used to determine this credit. The credit is claimed using Form 8882. 🎯 TSWA Tip Before creating or expanding an employee benefit, evaluate its potential tax treatment. A well-designed benefit can support your employees and strengthen your business. 💬 Business Owners: Would childcare assistance be a valuable benefit for your employees? 📖 Source: IRS — Employer-Provided Childcare Credit, Tax Year 2026 and Later

Generosity and Tax Planning Can Work Together Did you know that beginning in 2026, you may be able to deduct charitable contributions even if you don't itemize? For years, many taxpayers who claimed the standard deduction received no federal income tax deduction for their charitable contributions. That changes for 2026. Under the new rules, eligible taxpayers who do not itemize may deduct qualifying cash contributions of up to: 💰 $1,000 — Individual taxpayers 💰 $2,000 — Married couples filing jointly The IRS highlighted these rules in its October 2026 Publication 6196. 💡 Consider This Example A married couple makes $1,500 in qualifying cash donations during 2026. They claim the standard deduction rather than itemizing. Under the new rules, they may still qualify for a $1,500 charitable contribution deduction. Remember: A deduction reduces taxable income. It does not produce a dollar-for-dollar reduction in taxes. 📋 Important Qualifications Not every charitable contribution qualifies. The new deduction generally requires: ✅ Cash contributions made during 2026. ✅ Donations to eligible charitable organizations. ✅ Proper documentation, including receipts or bank records. ❌ Donations to donor-advised funds generally do not qualify. ❌ Donations of clothing, stock, or other property do not qualify for this particular deduction. 🎯 Tax-Smart Mindset You don't have to choose between generosity and financial responsibility. Thoughtful charitable giving can support causes you care about while potentially reducing your tax liability. But the tax benefit should support your giving decisions—not drive them. 💬 Community Question: Have you reviewed your 2026 charitable contributions to determine which gifts may qualify for a deduction? 📖 Source: IRS Publication 6196 — Charitable Contribution Deduction Tips for Non-Itemizers

For many extension filers, October 15 is the end of the 2025 filing process. But it should also trigger the next question: What does my completed 2025 return tell me about 2026? Your tax return is not just a compliance document. It is a planning document. Once the 2025 return is complete, compare it with your 2026 year-to-date results. Look for: Income changes — Is business profit materially higher or lower? Withholding — Is enough being withheld from wages? Estimated taxes — Are 2026 payments tracking the expected liability? Business structure — Has profitability changed enough to revisit your entity or compensation strategy? Retirement planning — Are there contributions or plan decisions that still need attention before year-end? Charitable planning — Are you waiting until December to think about giving? Capital gains and losses — Have investment transactions materially changed your projected tax position? The final 2026 estimated-tax installment for calendar-year individuals is generally due January 15, 2027, giving taxpayers another planning checkpoint after year-end. 🎯 Sunday Strategy Once your 2025 return is filed, schedule a 2026 tax projection. Don't ask only: “Did I finish last year's taxes?” Ask: “What did last year's return teach me about this year's decisions?” That is the difference between tax preparation and proactive tax planning.