Tax News Archives - Page 8 of 28

Jan
07
2019

elimination of the deduction for transportation fringe benefits

What’s the tax impact of the Tax Cuts and Jobs Act’s elimination of the deduction for transportation fringe benefits? The IRS has issued interim guidance regarding the treatment of qualified transportation fringe benefit expenses, paid or incurred after 12/31/17. The new rules assist employers in determining the amount of parking expense that’s no longer tax deductible. They also help tax-exempt organizations determine how these nondeductible parking expenses create or increase unrelated business taxable income.

Jan
05
2019

IRSNews

The IRS has launched an “IRSNews” account on Instagram. According to the agency, more than 70% of adults between ages 18 and 24 are active on the social media site. “The IRS plans to use Instagram to better serve this segment of the population, sharing content on tax topics that affect all taxpayers,” said IRS Commissioner Charles Rettig. “This platform will help make people aware of important options they have during the upcoming filing season as well as other tax information they might not know.” To access IRSNews,

Jan
01
2019

Sole Proprietorship newly released instructions for Schedule C

If you’re the owner of a sole proprietorship, listen up! Newly released instructions for Schedule C, Form 1040, reflect many of the key tax changes that apply to sole proprietors for tax year 2018. These changes, enacted by the Tax Cuts and Jobs Act, include accounting method liberalizations, limitations on deductions for business interest and business losses, a new deduction for qualified business income, and restrictions on deductions for business meals and entertainment expenses. Read the complete IRS-issued instructions here: http://bit.ly/2v0zJKU

Dec
30
2018

It’s not too late: You can still set up a retirement plan for 2018

If most of your money is tied up in your business, retirement can be a challenge. So if you haven’t already set up a tax-advantaged retirement plan, consider doing so this year. There’s still time to set one up and make contributions that will be deductible on your 2018 tax return. And funds can grow tax deferred. If you have employees, they generally must be allowed to participate in the plan, provided they meet the requirements.

Dec
29
2018

Buy business assets before year end to reduce your 2018 tax liability

Investing in business assets is a traditional and powerful year-end tax planning strategy, and it might make even more sense in 2018. Sec. 179 expensing and bonus depreciation both allow an immediate deduction for the cost of eligible asset purchases, rather than depreciating them over a number of years. The TCJA increases potential deductions under these breaks and expands the assets that are eligible. To qualify, you must place assets in service by the end of the year.

Dec
28
2018

Distribution from retirement plan

When a taxpayer under age 59-1/2 takes a distribution from a qualified retirement plan, a 10% penalty is generally imposed. However, exceptions may apply. In one case, a taxpayer argued that her gambling addiction qualified her for an exception due to disability. The gambling addiction arose, she said, from an addiction to medication, which led to compulsive behavior and then to financial problems. A U.S. Tax Court rejected her claim, finding she hadn’t established that she qualified for a disability exception.

Dec
25
2018

Check deductibility before making year-end charitable gifts

With tax law changes going into effect in 2018 and many rules applying to the charitable deduction, it’s a good idea to check deductibility before making year-end donations. First, total up your potential itemized deductions for the year, including the donations you’re considering. The total must exceed your standard deduction (which has been nearly doubled by the TCJA) for year-end donations to provide a tax benefit. Next, make sure the organization is qualified: http://bit.ly/2gFacut Finally,

Dec
24
2018

Meals

The IRS sheds light on meals provided for the convenience of an employer. An individual’s gross income generally includes compensation for services, including fringe benefits. An exception is the value of meals furnished by an employer, which are excludable if they’re furnished on the business premises for the employer’s convenience. The IRS Associate Chief Counsel issued Legal Advice 2018-004 stating that a previous test applied by the U.S. Supreme Court will continue to be relevant to determine whether there’s a business reason for furnishing meals to employees.

Dec
21
2018

Tax Bill Containing Technical Corrections

U.S. House Republicans have released a tax bill containing technical corrections, “extenders” and disaster relief. Released by the House Ways and Means chairman, the bill contains expiring tax provisions, technical fixes for the Tax Cuts and Jobs Act, disaster relief, retirement plans and improvements to the IRS. Finance Committee Democrats reportedly hadn’t weighed in on the bill before its release. The House could take up the bill by the end of this week,

Dec
15
2018

When holiday gifts and parties are deductible or taxable

It’s a great time of year for businesses to show their appreciation for employees and customers by giving them gifts or hosting holiday parties. Gifts to customers are generally deductible up to $25 per recipient per year. De minimis, noncash gifts to employees aren’t included in their taxable income yet are still deductible by you. Holiday parties are fully deductible provided they’re primarily for the benefit of non-highly-compensated employees and their families.