QBI, Sec 199A, Pass-Through Deduction: Know The Proposed Regs
Whatever you want to call it, the IRS issued proposed regulations on the pass-through business income deduction The IRS recently released highly anticipated regulations addressing the deduction for up to 20% of qualified business income (QBI) from pass-through entities. The deduction was a major component of the Tax Cuts and Jobs Act, which became law…
Read MoreIRS Issues Guidance on New Bonus Depreciation Rules
The Tax Cuts and Jobs Act (TCJA) significantly expands bonus depreciation under Section 168(k) of the Internal Revenue Code for both regular tax and alternative minimum tax (AMT) purposes. Now, the IRS has released proposed regulations that clarify the requirements that businesses must satisfy to claim bonus depreciation deductions. Although the regs are only proposed…
Read MoreChoose the Right Accounting Method for Tax Purposes
The Tax Cuts and Jobs Act (TCJA) liberalized the eligibility rules for using the cash method of accounting, making this method — which is simpler than the accrual method — available to more businesses. Now the IRS has provided procedures a small business taxpayer can use to obtain automatic consent to change its method of accounting under the TCJA. If you have the option to use either accounting method, it pays to consider whether switching methods would be beneficial.
Read MoreBook Review: Clockwork
Over the weekend I finished reading Mike Machalowicz’ latest book, Clockwork. Set to release on Tuesday Aug 21, 2018, this is a great book with some interesting concepts, but this book is not meant for everybody. The intended audience is entrepreneurs. Which not coincidentally is what I am passionate about. I enjoy helping entrepreneurs realize…
Read MoreWhy Employers are Taking Another Look at Life Insurance as a Fringe Benefit
Many employers are showing renewed interest in providing group term life insurance as a fringe benefit. For them, premiums paid are generally tax-deductible and, because claims occur infrequently, the coverage is typically simple and inexpensive to administer. Plus, at least one recent survey indicates employees really want employer-provided life insurance. For employees, group term coverage costs on up to $50,000 of coverage usually aren’t taxable. We can provide more information on group term life insurance, as well as other potential fringe benefits.
Read MoreA Family Limited Partnership Can Save Tax in a Family Business Succession
One of the biggest concerns for family business owners is succession planning — transferring ownership and control of the company to the next generation. Often, the best time tax-wise to start transferring ownership is long before the owner is ready to give up control of the business. A family limited partnership (FLP) can help owners…
Read MoreWhat You Need to Know About Tax Reform 2.0
Is more tax reform on the horizon? President Trump and Republican lawmakers currently are considering a second round of tax reform legislation as a follow-up to last year’s Tax Cuts and Jobs Act (TCJA). As of this writing, there’s been no actual bill drafted. However, House Ways and Means Committee Chair Kevin Brady (R-TX) just…
Read MoreWhy the “kiddie tax” is more dangerous than ever
Once upon a time, some parents and grandparents would attempt to save tax by putting investments in the names of their young children or grandchildren in lower income tax brackets. To discourage such strategies, Congress created the “kiddie” tax back in 1986. Since then, this tax has gradually become more far-reaching. Now, under the Tax…
Read MoreHow to Document Business Meals, Vehicle and Travel Expenses
Meal, vehicle and travel expenses are common deductions for businesses. But if you don’t properly document these expenses, you could find your deductions denied by the IRS. A critical requirement Subject to various rules and limits, business meal (generally 50%), vehicle and travel expenses may be deductible, whether you pay for the expenses directly or…
Read MoreLLC Restrictions on Professional Services Companies in California
Limited liability company (LLC) members that operate a “professional services” company registered in California are at risk of losing liability protection, paying penalties and interest, having to amend prior year tax returns, losing their company name and paying more administrative and accounting fees which could include adjustments to payroll and payroll tax returns. Ouch! LLCs…
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