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Shareholders of closely held C corporations commonly lease real estate, equipment, and other property to the corporate entity, either directly or through a separate partnership, a limited liability company, or an S corporation. Advantages that can motivate these rental arrangements include the following: Avoiding payroll taxes: Rental income from real estate is not subject to …
Much uncertainty exists in health care due to the constantly evolving health care environment. Physicians are dealing with vast amounts of new regulations and costs because of the Patient Protection and Affordable Care Act, P.L. 111-148, and other recent legislation. Providers are looking for ways to reduce their tax burden. Many are looking at their …
The revised limitation on interest expense brought about by the law known as the Tax Cuts and Jobs Act (TCJA), P.L. 115-97, may affect a broader base of businesses than originally anticipated by many. The newly minted Sec. 163(j) limits the deduction for business interest to the sum of business interest income and 30% of …
Continue reading Sec. 163(j) places renewed importance on tax shelter status
It's important for business owners to understand the risks behind signing personally on a business loan or line of credit. Most lenders require that small businesses sign personally. If the business defaults the debt, it will not only hurt their business but also their personal finances and credit. The process of applying for a loan …
Continue reading The Risks Associated With a Personal Guarantee
Under proposed regulations issued by the IRS on Thursday, transfers to a state agency or charitable organization in lieu of paying state and local taxes would be deductible as a charitable contribution only to the extent that the taxpayer making the donation did not receive a quid pro quo (REG-112176-18). Contributions that result in a …
Continue reading Proposed rules would curb avoidance of SALT deduction limit
Should you take out a loan or should you rent and save that purchase decision for a future date? These are the basics of loans vs. leasing for small businesses. As an entrepreneur, you may be looking to invest in new machinery, technology, or other types of expensive equipment to take your business to the …
Continue reading Equipment Loans vs. Leasing—Which is Better for Your Business?
The IRS issued proposed regulations (REG-104397-18) providing guidance on Sec. 168(k), which was amended by P.L. 115-97, known as the Tax Cuts and Jobs Act (TCJA), to increase the allowable first-year depreciation deduction for qualified property from 50% to 100%. The TCJA extended and modified bonus depreciation, allowing businesses to immediately deduct 100% of the …
Continue reading IRS issues proposed regs. on 100% bonus depreciation
The IRS issued proposed regulations on Wednesday regarding the qualified trade or business income deduction under Sec. 199A, which was enacted by P.L. 115-97, the law known as the Tax Cuts and Jobs Act (TCJA) (REG-107892-18). At the same time, it issued Notice 2018-64, which provides guidance on how to compute W-2 wages for purposes …
Continue reading Qualified business income deduction regs. proposed
The IRS issued proposed regulations on Wednesday on the Sec. 965 transition tax, which was added to the Code by P.L. 115-97, the law known as the Tax Cuts and Jobs Act (REG-104226-18). Sec. 965 applies to the last tax year of a deferred foreign income corporation (DFIC) that begins before Jan. 1, 2018. The …
Continue reading Proposed regs. address several transition tax issues
The IRS published final regulations that implement changes made by the American Jobs Creation Act of 2004, P.L. 108-357, and the Pension Protection Act of 2006, P.L. 109-280, to the substantiation and reporting rules for charitable contributions under Sec. 170 (T.D. 9836). The final regulations set forth the substantiation requirements for contributions of more than …
Continue reading Final rules govern adequate substantiation for charitable contributions
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