Author Archives: Mississippi Accountant CPA

2025 Tax Law Changes

A new year often brings with it numerous federal tax and state tax changes which can greatly impact your financial planning for the year. Watkins & Co. is here to break down the anticipated tax law changes for 2025 and ensure that your tax knowledge is current so that you can make fully informed financial decisions this year.

Federal Tax Law Changes 2025

Are you wondering, “Will personal exemptions come back in 2025?” Or, “What are the standard deductions in 2025?” You’re on the right track. In 2025, there are a few key considerations for upcoming tax changes that may play a large role in your tax planning.

The main 2025 federal tax changes revolve around the Tax Cuts and Jobs Act (TCJA) which was enacted in 2017 and which changed deductions, expensing, depreciation, and tax credits for individuals and businesses. At the end of 2025, TCJA is set to expire which means that without any legislative action, the end of this year will bring with it a reversion back to federal tax laws before TCJA was passed. What does this mean for you?

Individual tax rates will revert back to levels before TCJA which will result in the top rate increasing from 37% to almost 40%.
Standard deductions and personal exemptions were doubled and when TCJA expires, the standard deduction will decrease and taxable income calculations will increase. Essentially, you’ll be paying higher income taxes and the standard deduction will go down.
An entire slew of deductions and depreciation factors were adjusted in TCJA to be more friendly to the individual or business. With TCJA ending, many of these are reverting back to original rates which will ultimately affect both personal and business bottom lines.
Businesses will lose many of their tax credits that worked in their favor with TCJA.

This entire year, we can all enjoy the benefits TCJA brings but planning for the expiration of this provision is essential. What we’ve shared here is simply a general overview of the tax reforms that you can expect. For more information on the changes that will come at the end of this year with the expiration of the Tax Cuts and Jobs Act, contact your tax professional at Watkins & Co. We can break down the ins and outs of the changes for you and determine which aspects may affect you the most. Most importantly, we can help you plan for these changes and minimize the impact of the TCJA expiration.

Tax Reforms for 2025

Other notable changes for the 2025 tax year are also important to consider. Standard deductions increase to $15,000 for individuals and joint filings increase to $30,000. Heads of household can expect $22,500 for the standard deduction in 2025. For this year, the top tax rate remains at 37% (but will increase to around 40% when TCJA expires). There are also changes to the alternative minimum tax exemption amounts, earned income tax credits, qualified transportation fringe benefit, health flexible spending cafeteria plans, medical savings accounts, foreign earned income exclusion, estate tax credits, annual exclusion for gifts, and adoption credits. Most changes this year work in the favor of the individual or business. To learn more about the tax changes this year and how they may affect you, contact our team at Watkins & Co.

Our experienced tax accountants are standing by, ready to assist you with tax planning for the upcoming year. Watkins & Co. is here as your reliable partner in ensuring your financial future is stable and solid for this year and years to come.

CPAs for Small Business Startups Jackson, MS

Starting a business is an exhilarating and potentially terrifying endeavor. As a new business owner, you’ll face a whole host of challenges in every arena from staffing to administrative and financial. With all that in mind, are you debating about using the services of a CPA for your small business startup? In our last article, the professionals at Watkins & Co. discussed five reasons that partnering with a local CPA is a smart move for your company. Now, we’re here to finish up sharing all the benefits of hiring a CPA for your new business in Mississippi.

Continue reading →

5 Reasons Why Small Business Accounting Is Important

As a small business owner, you wear many hats and fill many roles. From marketing and sales to operations, you have to rely on yourself for many aspects of business. One area that will pay for itself time and time again is to outsource your accounting. Solid accounting practices are the lynchpin for many small businesses and is the bedrock of your company’s financial health and long-term success.

Continue reading →

5 Ways a CPA Can Help Your New Business Startup

If you’re in the process of starting a new business in Mississippi, congratulations! That’s exciting news, although in reality, it can come with its fair share of stress. Ensuring all the aspects of your business are accounted for is no small feat, one that must be taken on when you already have a full plate. One major component of a successful business startup is to make sure that you have a solid financial foundation on which to build. A CPA can be an invaluable partner on this journey, providing crucial financial expertise and support so that your business gets up and running smoothly.

Continue reading →

The Importance of Good Small Business Accounting

Experienced small business owners across America will all agree that proper business accounting can make or break your business. The value of accurate recordkeeping, payroll, cash flow, tax reporting, business analysis, and other business accounting tasks cannot be overstated. For those just starting a new business, it’s imperative to set up your accounting systems for success and ensure that you’re on the right track from the very start. To do so, it’s crucial to know what good small business accounting looks like and what you can expect from following a structured accounting plan.

Watkins & Co. has spent decades guiding small business start-ups in Mississippi through the ins and outs of proper small business accounting. The following five factors illustrate how accurate small business accounting plays a crucial role in the overall success and sustainability of any enterprise.

Continue reading →

Independent Contractor Tax Reporting with Form 1099

As independent contractors and the businesses that hire them, adhering to guidelines and best practices when reporting taxes is crucial. Staying compliant and properly reporting with the right Form 1099 is an absolute must to remain in good standing with the IRS. Watkins & Co. is here to share some important information on 1099 tax reporting do’s and don’ts.

Continue reading →

Everything You Need to Know About 1099s in 2024

For those operating businesses where independent contractors or other non-traditional income payments are being made, 1099s are how you will report income paid to individuals or entities during the tax year. The main purpose of a 1099 is for the IRS to track income that falls outside of the scope of traditional taxes. Businesses, organizations, or individuals are responsible for issuing 1099s if they make such income payments. Similarly, individuals are required to file taxes with a 1099 if they made any income that is not reported under a W-2 or other tax reporting form.

Continue reading →

10 Benefits of Outsourcing Payroll Services in 2024

The modern business world comes with its fair share of challenges. From smooth operations and budgeting to meeting employee needs, your time and effort as a business owner are in great demand. One way to alleviate some of the burden from your shoulders is to use a quality payroll service. There are various benefits to fully outsourcing your payroll to professionals who do this everyday besides the relief that comes from knowing your employees are in capable hands.

Continue reading →

10 Reasons to Use a Quality Bookkeeping Service

Quality bookkeeping is one of the foundational pillars of any successful business. Every decision affects your business and keeping accurate and precise financial records is arguably one of the most important decisions you’ll make. Not only does bookkeeping protect your business through the meticulous recording of financial transactions but it also offers the ability to stabilize and grow your company.

Continue reading →

5 Reasons to Use a CPA Firm 2024

Utilizing the services of a Certified Public Accountant (CPA) for a business of any size is a wise investment. From reducing expenses to minimizing tax benefits and ensuring compliance, CPAs can help your company save valuable time, effort, and money. The immeasurable benefit a reliable accounting firm brings is the peace of mind you’ll have from the knowledge that every financial aspect of your business is covered. In the Mississippi mid-state area, Watkins & Co. CPAs are your trusted partners – teaming with us provides numerous benefits that reach far beyond the day-to-day financial services we offer.

Continue reading →