We have had a number of clients who have been confused about the starting point for the new Section 199A tax deduction. Let me clarify: taxable income is the sole starting point for your Section 199A deduction. When your taxable income is equal to or less than the threshold of $157,500 (single) or $315,000 (married,
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Failure to use an accountable plan for your employee expense reimbursements (including yourself if you operate as a corporation) turns those improperly reimbursed expenses into taxable wages. In other words, by failing to comply with the accountable plan rules, you turn the tax-free reimbursement into taxable W-2 wages. That’s about as dreadful as it can
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Before tax reform, the de minimis safe harbor election was the best way to immediately expense the entire cost of your small-business assets for federal income tax purposes. Now that the Tax Cuts and Jobs Act tax reform gives you 100 percent bonus depreciation through 2022, you have three possible reasons to use 100 percent
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Here’s a heads-up. The 30 percent residential solar credit drops to 26 percent for tax year 2020, drops to 22 percent for tax year 2021, and terminates in 2022. Also, unlike the 30 percent commercial solar credit, where you can qualify for the 30 percent tax credit when you commence construction (as defined by the
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If you own more than 2 percent of an S corporation, you have to do three things to claim a deduction for your health insurance: -You must get the cost of the insurance on the S corporation’s books.-Your S corporation must include the health insurance premiums on your W-2 form.-You must (if eligible) claim the health
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You’ll find much beauty and little beast in using a single-member LLC for your real estate ownership. Should you use a single-member LLC as a real estate ownership vehicle? That might be a very good idea. Under the so-called check-the-box regulations put out years ago by the IRS, you can generally ignore the existence of
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Before the Tax Cuts and Jobs Act (TCJA), your purchase of the vehicle you were leasing did not qualify for either Section 179 expensing or bonus depreciation. But times have changed. The TCJA made two changes that mean 100 percent bonus depreciation is available on the vehicle you lease and then purchase, regardless of whether
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Premiums for Medicare health insurance can add up to a substantial sum. That’s especially true if-you have high income, and-you’re married and both you and your spouse are paying premiums. Fortunately, the premiums can potentially help your tax situation. The dollar benefit of Medicare tax deductions depends greatly on where you can deduct the premiums:-The
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Here’s good news for business meals: the Tax Cuts and Jobs Act (TCJA) removed the “directly related and associated with” requirements from business meals. The net effect of this change is to subject business meals once again to the pre-1963 “ordinary and necessary” business expense rules. You are going to like these rules. Restaurants and BarsQuestion 1. If,
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Here’s a rule: Protect yourself. Do not engage dishonest tax preparers. And here’s a story that I want you to hear. The government indicted, tried, and convicted tax preparer Gregory D. Goosby of 30 fraud violations where he willfully aided and assisted in the preparation of false and fraudulent income tax returns. Vincent Allen engaged
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