An annuity factor is a multiplier used to determine how much money will be paid out in the future at specific points of time under an annuity agreement. The simplest type of annuity is a defined series of identical future cash flows, starting exactly one period into the future. Using an annuity factor is a quick and easy way to determine the cash flows and to compare various annuity options.

The new Lease Accounting Regulations (ASC 842) require organizations that lease assets, or “Lessees” to recognize the assets and liabilities of those leases on their balance sheets. Most leases, including most operating leases, are now capitalized on the balance sheet.

In addition to the standard Failure to File and Failure to Pay penalties, there are multiple other penalties that can be assessed by the IRS that can be easily calculated and verified using TaxInterest IRS/State interest and penalty software. TaxInterest software will allow you to determine the penalty amount and do the appropriate interest calculation. TaxInterest also handles refund interest for both individuals and corporations.

The IRS standard penalties for income taxes are all a little different from each other and they are all interest bearing but they have different targets of when the interest starts which can make it challenging. The interest on Federal penalties is computed using the regular underpayment rate and is compounded daily. Interest can start from the return due date, the extension date, or the Notice/assessment date. TaxInterest software is an excellent program to do these varied calculations as all of the calculation methodology is built into each computation.

Officer or shareholder loans are common for privately held businesses. These loans need to be monitored closely to determine whether they are truly loans, or compensation, dividends, or contributions to equity. For a loan to be genuine, both the lender and the borrower must intend that the debt be repaid. There are a couple general requirements that “a loan should be treated like a loan”. A shareholder cannot simply “say” something was a loan. They actually need to treat it as one and the borrower has to have the ability to repay the loan.