Recently released IRS form 8995 instructions indicate that taxpayers filing business returns must reduce qualified business income by charitable deductions. A reduction in qualified business income reduces the potential qualified business income deduction. Although this provision is not in the Section 199A regulations, the reduction in qualified business income can be avoided by making [...]
Do you need to make repairs to your business premises or equipment? It can make a big tax difference if the work is characterized as a “repair” or an “improvement.” In brief, a repair is currently deductible by your business, while the cost of an improvement must be written off over time. The IRS and [...]
The IRS recently issued a stern warning to some taxpayers who plan to travel internationally: Pay off your tax debt or your passport may be revoked. Under a little-noticed 2015 law, the IRS was granted the authority to notify the State Department about taxpayers who have a “seriously delinquent tax debt.” This is defined [...]
Dear Clients and Friends (and Blog Readers!): With the first tax season under the Tax Cuts and Jobs Act (TCJA) behind us, we have a better understanding of the practical applications on the tax law changes. As expected, the law changes had a profound impact on many taxpayers and created new planning opportunities. There [...]
As you are probably aware if you read this blog consistently, we think Opportunity Zones have great potential for taxpayers/investors. In fact, since last fall, many of the uncertainties around Opportunity Zones have been cleared up through IRS regulations. Most people are not expecting any more official IRS guidance release so the rules of [...]
The massive tax legislation signed over a year ago, the Tax Cuts and Jobs Act (TCJA), authorized a brand-new deduction for qualified business income (QBI) of pass-through entities and sole proprietors. This deduction under Section 199A of the tax code provides opportunities for a wide range of taxpayers, but has also caused confusion, especially as [...]
Generally, when you rent out a vacation home to strangers, you must pay tax on the rental income, but you are then entitled to some offsetting deductions. Special rule: There are no tax consequences for a rental lasting two weeks or less. In other words, you do not owe any tax, but you cannot [...]
This may be the last year you claim a medical expense deduction on your personal tax return. It all has to do with several changes in the Tax Cuts and Jobs Act (TCJA). Background: Among other provisions that are generally effective for 2018 through 2025, the TCJA cuts back or eliminates certain itemized deductions, while [...]
Are any of your children currently attending college or preparing to enter school in the fall? The tax law provides several special tax breaks that may benefit parents who help pay qualified expenses. In particular, you may be able to claim one of two tax credits for higher education, subject to certain restrictions. Following is [...]
Under the Tax Cuts and Jobs Act (TCJA), certain deductions have been eliminated or modified, including the write-off for state and local tax (SALT) payments. The changes are effective for 2018 through 2025. As a result, some taxpayers will be going on a SALT-free diet when they file their 2018 returns. Background: Previously, many middle-to-upper [...]