• Home
  • About You
  • About Us
    • Our Services
    • Our People
  • Our Clients
  • Jobs
  • Resources
  • Blog
  • Contact
Accountability Services
Tel: 206.522.0110

Accrued Bonuses

12/3/2012

 
Deduct these expenses before they are paid

The IRS has ruled in favor of accrual-method businesses deducting unpaid bonuses at the end of the year. The company must pay the accrued bonuses within 2½ months of the end of its tax year.

There are other caveats with this deduction as well. The employee must be employed on the date the bonuses are paid and the company must be using an incentive-based bonus plan of which the employees are aware. The bonus plan must have an aggregate amount of the bonus payable fixed across a group of employees. However, the company does not need to know the identity of any particular bonus recipient and the amount payable to that employee until after the end of the taxable year.If this sounds like a feasible option for your company, talk with one of our tax professionals for personalized advice.

Comments are closed.

    Accountability Services

    Welcome to The Bottom Line, an online newsletter from Accountability Services. As clients, friends and colleagues, we are excited to share with you financial updates, tips, company news, and opportunities in each issue of The Bottom Line. 

    Archives

    January 2018
    December 2017
    November 2017
    October 2017
    July 2017
    June 2017
    January 2017
    December 2016
    November 2016
    October 2016
    July 2016
    June 2016
    May 2016
    March 2016
    January 2016
    December 2015
    November 2015
    October 2015
    September 2015
    August 2015
    July 2015
    June 2015
    May 2015
    April 2015
    March 2015
    February 2015
    January 2015
    December 2014
    November 2014
    October 2014
    September 2014
    August 2014
    July 2014
    June 2014
    May 2014
    August 2013
    July 2013
    June 2013
    May 2013
    April 2013
    March 2013
    February 2013
    January 2013
    December 2012
    November 2012
    October 2012
    September 2012
    August 2012
    July 2012
    September 2011
    March 2011
    September 2010
    August 2010
    December 2009
    September 2009
    May 2009
    February 2009
    January 2009
    September 2008
    May 2008
    March 2008

    RSS Feed

© 2003-2018 Accountability Services PLLC  Privacy Policy
Website by Pretty Smart Design
✕