Eftex Tax Solutions

🎓 **Individual Tax Tip**
**Are You Matching 529 Withdrawals to Qualified Education Expenses?**

A 529 plan distribution is generally tax-free when it is used for eligible education expenses—but good documentation is essential.

Depending on the student’s circumstances, qualified expenses may include:

✔ Tuition and required enrollment fees
✔ Required books and supplies
✔ Computers, related equipment, and internet access
✔ Certain room-and-board expenses for eligible students

To keep your records organized:

✔ Match each year’s withdrawals to that year’s qualified expenses
✔ Save Form 1099-Q, school statements, and receipts
✔ Account for scholarships and other tax-free assistance
✔ Avoid using the same expense for both a tax-free withdrawal and another education tax benefit
✔ Review any withdrawal that exceeds documented expenses

If total withdrawals exceed the student’s adjusted qualified expenses, part of the earnings may become taxable.

📅 **Have questions about your family’s education expenses?**

Schedule your 15-minute Individual Tax Consultation:
https://calendly.com/eftex-flora/15min

**Eftex Tax Solutions**
Your Trusted Tax & Bookkeeping Partner in Katy, Texas.
*Maximizing Savings. Ensuring Compliance. Empowering Growth.*

🇺🇸 Happy Labor Day!

Today, we recognize the dedication, hard work, and contributions of workers in every industry.

Eftex Tax Solutions will be closed on **Monday, September 7**, in observance of the holiday. We will reopen and resume normal business hours on **Tuesday, September 8**.

We hope you have a safe and restful Labor Day!

**Eftex Tax Solutions**
*Maximizing Savings. Ensuring Compliance. Empowering Growth.*

📊 **Bookkeeping Tip**
**Are Owner Contributions and Draws Recorded Correctly?**

Money moving between you and your business should not automatically be recorded as income or a business expense.

Generally:

✔ **Owner contributions** represent money or property the owner puts into the business.
✔ **Owner draws** represent money the owner takes from the business for personal use.

For many small businesses, these transactions belong in equity accounts. However, the correct account and tax treatment depend on the business structure and how the owner is paid.

To keep your records clean:

✔ Separate business and personal transactions
✔ Record the date, amount, and source of each transfer
✔ Use the appropriate contribution or draw account
✔ Never categorize personal withdrawals as business expenses
✔ Reconcile owner activity regularly

Accurate records help protect the integrity of your financial reports and make year-end tax planning much easier.

📅 **Need help cleaning up or maintaining your books?**

Schedule your Bookkeeping Consultation:
https://calendly.com/eftex-flora/accounting

**Eftex Tax Solutions**
Your Trusted Tax & Bookkeeping Partner in Katy, Texas.
*Maximizing Savings. Ensuring Compliance. Empowering Growth.*

💼 **Business Tax Tip**
**Can Your Business Deduct Employee Education and Training? **

Investing in your team can strengthen your business—and some education and training expenses may receive favorable tax treatment.

These expenses may include:

✔ Professional certifications
✔ Continuing education
✔ Software or technical training
✔ Tuition and required course materials
✔ Job-related professional development

For 2026, a properly structured Section 127 educational-assistance program may allow up to $5,250 in qualifying benefits per employee to be excluded from the employee’s taxable wages.

Before paying or reimbursing an education expense:

✔ Confirm the business purpose
✔ Document the course, provider, payment, and completion
✔ Use a written plan when relying on Section 127
✔ Coordinate the bookkeeping and payroll treatment

The details matter, so review the arrangement before recording the expense or promising tax-free treatment.

📅 **Need help keeping your business records and tax strategy on track?**

Schedule your Business Tax & Bookkeeping Consultation:
https://calendly.com/eftex-flora/accounting

**Eftex Tax Solutions**
Your Trusted Tax & Bookkeeping Partner in Katy, Texas.
*Maximizing Savings. Ensuring Compliance. Empowering Growth.*

🎓 Individual Tax Tip
**Is Scholarship Money Always Tax-Free?**

Scholarships can help reduce the cost of college, but not every dollar received is automatically tax-free.

Scholarship funds may generally be tax-free when the student is pursuing a degree and the money is used for:

✔ Tuition and required enrollment fees
✔ Books, supplies, and equipment required for courses

Scholarship funds may be taxable when used for:

• Room and board
• Travel
• Optional equipment
• Payments for teaching, research, or other required services—with limited exceptions

Keep the scholarship award letter and records showing how the funds were used. Good documentation can help determine whether any portion must be reported as income.

📅 Questions about scholarship funds and your tax situation?

Schedule your 15-minute Individual Tax Consultation:
https://calendly.com/eftex-flora/15min

Eftex Tax Solutions
Your Trusted Tax & Bookkeeping Partner in Katy, Texas.
Maximizing Savings. Ensuring Compliance. Empowering Growth.

📚 **The Eftex Advantage | September 2026**

**Back to School, Back to Tax Planning**

Back-to-school season brings new routines, new expenses, and a few important financial considerations for families and business owners.

This month’s newsletter covers:

✔ Education credits and qualified expenses
✔ When scholarship funds may be taxable
✔ Documentation for employee education and training
✔ Bookkeeping habits to strengthen before year-end
✔ A quick way to organize school-related tax records

A little preparation now can make tax season much easier later.

🧾 **Individual Tax Consultation:**
https://calendly.com/eftex-flora/15min

🏢 **Business & Bookkeeping Consultation:**
https://calendly.com/eftex-flora/accounting

**Eftex Tax Solutions**
Your Trusted Tax & Bookkeeping Partner in Katy, Texas.
*Maximizing Savings. Ensuring Compliance. Empowering Growth.*

📊 Bookkeeping Tip
Are Automated Bank Rules Creating Bookkeeping Errors?

Automated bank rules can save time—but they should not run without regular review.

A rule created months ago may continue categorizing transactions incorrectly, especially when vendors, payment descriptions, or spending habits change.

Take a few minutes to review:

✔ Transactions assigned to the wrong category
✔ Duplicate or overlapping rules
✔ Rules connected to inactive vendors or accounts
✔ Personal purchases recorded as business expenses
✔ Transactions that should be divided between multiple categories

Automation is helpful, but accurate bookkeeping still requires human oversight.

📅 Need help reviewing or cleaning up your books?

Schedule your Bookkeeping Consultation:
https://calendly.com/eftex-flora/accounting

Eftex Tax Solutions
Your Trusted Tax & Bookkeeping Partner in Katy, Texas.
Maximizing Savings. Ensuring Compliance. Empowering Growth.

💼 Business Tax Tip
**Are You Paying Yourself the Right Way?**

Taking money from your business is not as simple as transferring funds to your personal account. The correct method depends on how your business is structured.

Depending on the entity, an owner may receive:

✔ An owner’s draw
✔ A partner distribution or guaranteed payment
✔ Payroll wages
✔ A shareholder distribution

For example, corporate officers who perform services are generally treated as employees, while partners are not employees and generally should not receive a W-2 for partnership distributions or guaranteed payments.

Recording owner compensation incorrectly can affect your bookkeeping, payroll reporting, and tax compliance.

📅 Not sure whether you’re paying yourself correctly?

Schedule your Business Tax & Bookkeeping Consultation:
https://calendly.com/eftex-flora/accounting

Eftex Tax Solutions
Your Trusted Tax & Bookkeeping Partner in Katy, Texas.
Maximizing Savings. Ensuring Compliance. Empowering Growth.

🎓 Individual Tax Tip
**Can You Claim Your College Student as a Dependent?**

A student moving away for college does not automatically mean parents lose the ability to claim them as a dependent.

Several factors may determine eligibility, including whether the student:

✔ Is under age 24 and enrolled full-time
✔ Meets the relationship requirements
✔ Lived with you for more than half the year, time away at college may count as a temporary absence
✔ Provided more than half of their own financial support
✔ Filed a joint return with a spouse

Dependency rules can also affect eligibility for certain education-related tax benefits, so it’s important for families to coordinate before anyone files a return.

📅 Have questions about your college student and your tax situation?

Schedule your 15-minute Individual Tax Consultation:
https://calendly.com/eftex-flora/15min

Eftex Tax Solutions
Your Trusted Tax & Bookkeeping Partner in Katy, Texas.
Maximizing Savings. Ensuring Compliance. Empowering Growth.

📊 Bookkeeping Tip
Who Still Has Access to Your Accounting System?

Employees, contractors, and outside professionals may receive access to your accounting software—but that access should not remain in place indefinitely.

Take a few minutes to:

✔ Remove former employees and inactive users
✔ Confirm each user has only the permissions they need
✔ Turn on multifactor authentication when available
✔ Review connected applications and integrations
✔ Make sure administrator access is limited

Regular access reviews help protect sensitive financial information and reduce the risk of unauthorized changes.

📅 Ready to strengthen your bookkeeping processes?

Schedule your Bookkeeping Consultation:
https://calendly.com/eftex-flora/accounting

Eftex Tax Solutions
Your Trusted Tax & Bookkeeping Partner in Katy, Texas.
Maximizing Savings. Ensuring Compliance. Empowering Growth.