One of the most mis-understood parts of the tax code is how to handle fringe benefits when you are a shareholder of a S corporation.  Here's a quick primer on life insurance, retirement plans and health insurance:

In general, a business may provide certain tax-free fringe benefits to its employees. One such benefit is group term life insurance up to $50,000, but there are special rules regarding fringe benefits that apply to S corporation 2% shareholder-employees. Generally, a 2% shareholder is a shareholder who owns more than 2% of the S corporation’s stock on any day during the tax year.

(Under §1372 and Rev. Rul. 91-26, for fringe benefit purposes, an S corporation 2% shareholder who is also an employee of the corporation is treated the same way as a partner in a partnership.)

The number of content creators on social media have ballooned and advertising departments have noticed.  Sending their products to creators to evaluate is one of the most cost effective ways to get your name out their to an audience that is willing to listen.  

What a lot of new creators fail to address is how to handle these 'gifts' from a tax standpoint. So let's review the rules and IRS regulations that pertain to this subject. Here is an example situation to begin the discussion:

America enjoys levels of wealth and prosperity never before experienced in world history. For that, we can thank capitalism.

But capitalism is not doing so hot among the young. According to the latest Gallup survey on views about capitalism and socialism, more Americans aged 18 to 29 are positive about socialism (51 percent) than about capitalism (45 percent).

Since they don't teach proper history in school anymore, a discussion on how totalitarian rule begins has been eliminated or is just used as a footnote somewhere along the line. But to those of us who do like to learn from history, there are two things that precede dictatorships - even those that pretend to be democracies. Those two things are:

Virtual currency is a digital representation of value, other than a representation of the U.S. dollar or a foreign currency ("real currency"), that functions as a unit of account, a store of value, or a medium of exchange.

-IRS

While virtual currency has been around since 2009, it has become better know over the last couple of years. Although there are now dozens of them, some of the most popular names are bitcoin, ethereum, dogecoin and litecoin.

All convertible currency such as cryptocurrency is considered a capital asset for most taxpayers. You invest in virtual currency in the hopes that it will increase in value.

The price of a cryptocurrency is based on one unit, and the pricing is based on the per-unit value, which goes up and down just as a unit of stock would on a stock exchange.

Crowdfunding is a method of raising money through websites by soliciting contributions from a large number of people. The contributions may be solicited to fund businesses, for charitable donations, or for gifts. In some cases, the money raised through crowdfunding is solicited by crowdfunding organizers on behalf of other people or businesses. In other cases, people establish crowdfunding campaigns to raise money for themselves or their businesses.

Some identity thieves use taxpayers' information to file fraudulent tax returns. By requesting Identity Protection PINs from the Get an IP PIN tool on IRS.gov, taxpayers can prevent thieves from claiming tax refunds in their names. Seeing that it is free, this is a no brainer.

The Social Security Administration has just released a streamlined process for obtaining standard replacement Social Security Cards for lost cards; however, if you need to make a change to your card (name change, etc.) you cannot use the new process.

To utilize this new feature, constituents must have a valid, unexpired US driver’s license or state id, a working web camera, a valid email address to receive a Microsoft Teams invitation, and a computer. Participants must download Teams prior to their scheduled appointment with a Social Security Administration representative. To set up an appointment and use this feature, please call 1-888-397-5325.