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The IRS continues to focus their audit activities in key small business areas. The wise business owner is well advised to be able to defend the following five areas to keep the IRS at a comfortable distance: Business or hobby? Be ready to provide proof your business is truly a business and not a hobby. …
Continue reading The IRS Loves Your Business … and That is NOT Good
As 2018 winds down, there is still time to reduce your potential tax obligation. Here are some ideas to make your 2018 tax return less of a burden on your wallet: Accelerate expenses. Individual taxpayers are on the cash basis for income tax purposes. This means your income is taxable when you receive it and …
For the first time since 2013, the IRS is raising the contributions limits for IRAs. The maximum contribution for 401(k) accounts and IRAs is increasing by $500 for 2019. If you have not already done so, now is the time to plan for contributions into your retirement accounts in 2019. Check out the tables below …
Continue reading Retirement Contributions Get a Boost in 2019
The optional standard mileage rates for business use of a vehicle will increase significantly in 2019, after increasing slightly last year, the IRS announced Friday (Notice 2019-2). For business use of a car, van, pickup truck, or panel truck, the rate for 2019 will be 58 cents per mile up from 54.5 cents per mile …
In Notice 2018-99, the IRS, responding to questions from taxpayers, provided guidance about how to determine the amount of parking expenses that is nondeductible when employers provide parking for their employees. Under Sec. 274(a)(4), expenses incurred for providing parking to employees that are Sec. 132(f) qualified transportation fringes (QTF) are nondeductible by employers. They are …
Continue reading IRS explains disallowance of qualified transportation fringe benefits for parking
The enactment of Sec. 199A provides one more reason to advise clients to create separate trusts for individual beneficiaries instead of a single trust. A single trust for the benefit of all the children may seem fair and less expensive when children are young. However, different ages, family size, economic status, and risk tolerance can …
According to IRS Notice 2018-61, Treasury and the IRS intend to issue regulations providing clarification of the effect of newly enacted Sec. 67(g) on the ability of trusts and estates to deduct certain expenses. Sec. 67(g), which was enacted by the law known as the Tax Cuts and Jobs Act (TCJA), P.L. 115-97, suspends miscellaneous …
Continue reading Clarification of itemized deductions for trusts and estates
The significant reduction in the corporate tax rate (from 35% to 21%) brought about by the law known as the Tax Cuts and Jobs Act of 2017 (TCJA), P.L. 115-97, has many S corporations considering whether to convert to a C corporation to take advantage of the lower rate. Before electing to make the change, …
The IRS issued proposed regulations 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 cost …
Continue reading IRS issues proposed regs. on 100% bonus depreciation
The IRS on Monday issued final regulations (T.D. 9843) that amend the uniform capitalization (UNICAP) rules under Sec. 263A. The IRS also updated the procedures by which taxpayers can get automatic consent to change their methods of accounting to reflect the new regulations (Rev. Proc. 2018-56). UNICAP regulations The IRS says the rules issued in …
Continue reading UNICAP rules on negative adjustments finalized
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