Enrolled Agent Exam [Part 2] 72, Employer Health Insurance Premium Credit

Enrolled Agent Exam [Part 2] 72, Employer Health Insurance Premium Credit

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams. In this episode you will learn: - The Small Business Health Care Tax Credit requires fewer than 25 Full-Time Equivalent (FTE) employees, which is based on total hours worked, not a simple headcount. - Eligibility requires average annual wages below an inflation-adjusted threshold and that the health insurance be purchased through a SHOP Marketplace. - The maximum credit is 50% of premiums paid (35% for non-profits), but this amount phases out as employee count and average wages increase. - A critical exam trap is the two-consecutive-year limit for claiming the credit, which begins the first year it is taken. - The employer's deduction for health insurance premiums must be reduced by the dollar amount of the credit claimed. For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or YouTube Channel: https://www.youtube.com/@Open-exam-prep

Enrolled Agent Exam [Part 2] 71, Employer-Provided Childcare Credit

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams. In this episode you will learn: - How to calculate the Employer-Provided Childcare Credit using the 25% and 10% rates. - The maximum annual credit limit of $150,000 and how it functions as a common exam trap. - The key requirements for a 'qualified childcare facility', including non-discrimination rules. - The critical 10-year recapture rule that applies if a facility ceases operations. - The specific IRS form, Form 8882, used to claim this general business credit. For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or YouTube Channel: https://www.youtube.com/@Open-exam-prep

Enrolled Agent Exam [Part 2] 70, Disabled Access Credit and FICA Tip Credit

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams. In this episode you will learn: - The Disabled Access Credit is for small businesses with under $1 million in prior-year receipts OR 30 or fewer full-time employees. - How to calculate the Disabled Access Credit as 50% of eligible expenditures between $250 and $10,250, for a maximum credit of $5,000. - The FICA Tip Credit is for food and beverage employers for their share of FICA taxes paid on certain employee tips. - An exam trap for the FICA Tip Credit is to use the statutory $5.15 per hour rate in calculations, not the current federal minimum wage. - Employers claiming the FICA Tip Credit cannot also deduct the portion of FICA taxes that generated the credit. For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or YouTube Channel: https://www.youtube.com/@Open-exam-prep

Enrolled Agent Exam [Part 2] 69, Work Opportunity Tax Credit (WOTC)

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams. In this episode you will learn: - The WOTC is a general business credit for hiring individuals from specific targeted groups who face employment barriers. - The credit is calculated as either 25% (for 120-399 hours worked) or 40% (for 400+ hours worked) of qualified first-year wages. - Qualified wages are generally capped at the first $6,000 of earnings, resulting in a maximum credit of $2,400 per employee for most groups. - Employers MUST file Form 8850 with their state workforce agency within 28 days of the employee's start date to be eligible for the credit. - A critical exam trap: The employer's deduction for salaries and wages must be reduced by the amount of the WOTC claimed. For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or YouTube Channel: https://www.youtube.com/@Open-exam-prep

Enrolled Agent Exam [Part 2] 68, Research and Development Credit (§41)

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams. In this episode you will learn: - Post-2021, §174 R&D costs must be capitalized and amortized over 5 years for domestic research or 15 years for foreign research. - The §41 credit is calculated on Qualified Research Expenses (QREs), such as wages and supplies, but excludes costs like research after commercial production begins. - Claiming the R&D credit requires you to reduce your otherwise allowable deduction for those same research expenses by the amount of the credit. - A Qualified Small Business may elect to use the R&D credit to offset payroll taxes. - To be a Qualified Small Business for the payroll tax offset, the business must have less than $5 million in gross receipts and be in its first five years of having gross receipts. For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or YouTube Channel: https://www.youtube.com/@Open-exam-prep