Month: March 2023

Taxation Overview of Bank & Credit Card Rewards
Banking rewards, such as cash-back offers, points, and miles, have become a common incentive offered by banks and credit card issuers to attract and retain customers. However, the tax implications surrounding these programs often leads to confusion. So let’s look at a handful of common programs and discuss the tax status surrounding each. The 5 most common types of reward programs are: Credit Card Spending BonusesCredit Card Spending RewardsFrequent Flyer MilesBank Account Sign-Up BonusesReferral Bonuses It’s important to point out that there is not a lot of official guidance on the proper tax treatment for some of these items. This
An Overview of Sales & Use Tax
What is it? Sales and use tax is a form of tax that is imposed by both state and local governments on the sale or use of goods and services. Sales tax is assessed by the state or local government to the seller and is a certain percentage of the sale. This percentage varies by state and locality. The sales tax is usually passed on to the buyer, resulting in the buyer paying the tax. When the states first enacted their sales taxes, the tax was imposed only on in-state sales.  There was no use tax.  As businesses began to
Introduction to Stock Options
What is an Option? A financial option is a contractual agreement between two parties, whereby the buyer of the option is granted the right, but not the obligation, to purchase or sell an asset at a pre-determined price (referred to as the strike price), during a specified period of time. The underlying asset can be a stock, bond, commodity, currency, or any other financial instrument. The contract typically represent 100 shares of the asset. Every option contract has a price that frequently changes based on three things: The price of the underlying asset (referred to as Delta)The time left on
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