February 2018 - HBL CPAs

Feb
27
2018

Tax Rules for Alimony

The Tax Cuts and Jobs Act (TCJA) will be changing the tax rules of the road for alimony. Under current rules, individuals who pay alimony or maintenance can deduct an amount equal to the payments made during the year as an “above-the-line” deduction. And, under current rules, alimony and maintenance payments are taxable to recipients. But under the TCJA, there’s no deduction for alimony for the payers and alimony isn’t gross income to the recipients.

Feb
15
2018

Watch out for potential tax pitfalls of donating real estate to charity

Charitable giving allows you to help an organization you care about and, in most cases, enjoy a valuable income tax deduction. If you’re considering a large gift, a noncash donation such as appreciated real estate can provide additional benefits. For example, if you’ve held the property for more than one year, you generally will be able to deduct its full fair market value and avoid any capital gains tax you’d owe if you sold the property.

Feb
13
2018

Tax Extenders 2018

SUMMARY OF THE TAX EXTENDERS AGREEMENT

DIVISION D – REVENUE MEASURES

TITLE I – EXTENSION OF EXPIRING PROVISIONS

Subtitle A – Tax Relief for Families and Individuals

Section 40201. Extension and modification of exclusion from gross income of discharge of

qualified principal residence indebtedness. The provision extends through 2017 the exclusion

from gross income of a discharge of qualified principal residence indebtedness.

Feb
13
2018

Save more for college through the tax advantages of a 529 savings plan

With kids back in school, it’s a good time for parents (and grandparents) to think about college funding. One option, which can be especially beneficial if the children in question still have many years until they’ll be starting their higher education, is a Section 529 plan.

Tax-deferred compounding

529 plans are generally state-sponsored, and the savings-plan option offers the opportunity to potentially build up a significant college nest egg because of tax-deferred compounding.

Feb
08
2018

Tax Debt and Passports?

What does tax debt have to do with a passport? Passports are issued by the State Dept., not the IRS. But a 2015 law requires the IRS to notify the State Dept. of taxpayers having “seriously delinquent tax debt,” generally defined as tax debt exceeding $50,000 and for which a lien has been filed (for tax years beginning after Jan. 1, 2016). Unless exceptions apply, such tax debt is grounds for denial of a passport or revocation or limitation of an existing passport.

Feb
06
2018

Withholding Taxes from Employees

Employers who withhold taxes from employee paychecks but fail to turn them over to the IRS may face a severe penalty. The Trust Fund Recovery Penalty is equal to 100% of the unpaid tax and can be assessed personally against responsible parties. In one case, a plastic surgeon said he’d acted in good faith, but was denied a new trial when the 5th Circuit Court of Appeals found he’d willfully evaded tax payment. Facts showed he’d paid employees with cashier’s checks and used available funds to pay personal expenses instead of paying taxes owed.