Article Highlights: Limit on Tax Allowed as an Itemized DeductionStates’ Attempted Workarounds Supreme Court RulingFinal RegulationsNotice 2019-12 The Treasury Department and the IRS have essentially shot down efforts by several states to help their residents circumvent the $10,000 cap on the itemized deduction for state and local taxes (SALT). When the Tax Cuts and Jobs [...]
It’s a common conundrum: You want to file your taxes on time, but you anticipate or already know that you will owe money you can’t afford to pay right now. As a result, you put off filing your tax return under the assumption that the IRS can only bill you if they receive your latest [...]
Article Highlights: For-Profit BusinessesNot-for-Profit BusinessesNine Determining FactorsProfit Presumption Taxpayers are often confused by the differences in tax treatment between businesses that are entered into for profit and those that are not, commonly referred to as hobbies. Recent tax law changes have added to the confusion. The differences are: Businesses Entered Into for Profit – For [...]
Article Highlights: Household Employee DefinitionEmployee Control FactorsSelf-employed or EmployeeWithholding RequirementsReporting Requirements Taxpayers often will hire an individual or firm to provide services at the taxpayer’s home. Because the IRS requires employers to withhold taxes for employees and issue them W-2s at the end of the year, the big question is whether or not that individual [...]
Article Highlights: Primarily Business Primarily VacationSpecial CircumstancesForeign Conventions, Seminars and MeetingsCruise ShipsSpousal Travel Expenses Note: effective for years 2018 through 2025, the Tax Cuts and Jobs Act of 2017 suspended the deduction of miscellaneous itemized expenses that must be reduced by 2% of the taxpayer's adjusted gross income. Employee business expenses, including travel expenses, fall [...]
Article Highlights: Donor-Advised FundItemized or Standard DeductionsSponsoring OrganizationsTax BenefitsBunching StrategyHigh Income YearsDonating Appreciated Assets If you would like to make a substantial tax-deductible charitable donation this year, but have the ability to spread the actual distribution of funds to specific charities over a number of years, a donor-advised fund (DAF) may fill that need. There [...]
Article Highlights: EmployeesSelf-Employed IndividualsIndividuals with Sources of Income Without WithholdingQuarterly PaymentsUnderpayment PenaltySafe Harbor Payments June 15th falls on the weekend this year, so the due date for the second installment of estimated taxes is the next business day, June 17, which is just around the corner. So, it is time to determine if your estimated [...]
Article Highlights: Child Age LimitsEmployment-Related ExpenseMarried Taxpayer Earnings LimitsDisabled or Full-Time-Student SpouseExpense Limits Summer has just arrived, and there is a tax break that working parents should know about. Many working parents must arrange for care of their children under 13 years of age (or any age if disabled) during the school vacation period. A [...]
Article Highlights: Tax CreditCredit Phase-OutTeslaGeneral MotorsDetermining the CreditOff-Road Vehicles and Golf Carts Allocation Between Business and Personal UseCredit Reduces BasisBusiness Standard Mileage Back in 2009 Congress created a tax credit for the purchase of electric vehicles as a stimulus for car companies to manufacture “green” vehicles and as an incentive for consumers to purchase electric [...]
Article Highlights: Purpose of Qualified Tuition PlansGift Tax ImplicationsSpecial Five-Year ElectionChange of BeneficiaryEligible ExpensesDirect Payment of Tuition Qualified tuition plans (QTPs) provide a means for family members and others to save for the future educational needs of children. Investment earnings within a QTP account are tax deferred and not taxable when withdrawn if used to [...]
