Ever since tax reform was passed, over a year ago, taxpayers have been uncertain whether rental property will be classified as a trade or business for purposes of qualifying for the new IRC Sec 199A 20% pass-through deduction (commonly referred to as the 199A deduction).
Finally, on January 18, 2019, the IRS issued a notice which provided “safe harbor” conditions under which a rental real estate activity will be treated as a trade or business for purposes of the 199A deduction.
It’s important to note that this notice prescribes several conditions that must be met for a rental real estate enterprise (a tax term introduced by the IRS in this notice) to be deemed to be a trade or business and eligible for the section 199A 20% deduction. For purposes of this safe harbor, a rental real estate enterprise is defined as an interest in real property held for the production of rents and may consist of an interest in multiple properties.
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Tags:
Tax Deductions,
Small Business,
Tax Reform,
Rental Real Estate
Tax reform has changed the way most taxpayers need to think about and plan for their taxes. It is no longer business as usual. Advanced planning will become very important long before tax time next year.
For most taxpayers, the most significant change is the increase in their standard deduction, which on the surface seems like a big benefit. But, don’t overlook the fact that the same tax reform that nearly doubled the standard deduction took away the personal exemption as a deduction.
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Tags:
Itemizing Deductions,
Tax Planning,
Tax Deductions,
Tax Deductible Travel Expenses,
Business Tax,
Individual Tax,
TCJA
The time spent getting organized for your tax appointment is priceless. It gives you confidence that your returns will be filed timely, accurately, and that all qualified deductions are accounted for.
Partnering with an experienced Certified Public Accountant can bring you piece of mind and possibly tax savings. Here are some tips for making the best of that partnership:
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Tax Planning,
Tax Deductions,
tax appointment
On May 9, 2014, the IRS published final regulations pertaining to certain costs incurred by estates and non-grantor trusts, and finally brought an end to some controversial issues surrounding the deductibility of certain costs.
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Tags:
Tax Planning,
Tax Deductions,
Estate and Trust Tax
If you, your spouse, or a dependent on your tax return is currently attending school, you may be eligible for an education tax credit. The two tax credits that may be available are the American Opportunity Credit and the Lifetime Learning Credit.
These credits can be used on your federal tax return to help offset the financial burden of attaining a higher education.
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Tax Deductions,
Tax Credit,
Education
More than 50 individual and business tax deductions and credits were signed into law in December 2014 as part of “The Tax Increase Prevention Act”.
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Tags:
Tax Provisions,
Tax Deductions,
Retirement Plan,
Depreciation Deduction,
Tuition,
Section 179,
Work Opportunity,
Classroom Expenses,
Local Income Tax,
Tax Credit,
IRA,
Mortgage,
Sales Tax,
State Income Tax
At BHT&D CPAs, we get many questions regarding charitable donations throughout the year. Here are a few things to consider as you make your donations:
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Tags:
Tax Planning,
Tax Deductions,
Donation to Charity,
Charitable Deductions
A tax deduction question we often hear is, "What are my options for deducting my automobile expenses?" The Internal Revenue Code allows for two methods for deducting automobile expenses incurred for business use purposes, the standard mileage rate method and the actual expense method. Are you using the best method for you?
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Tags:
Automobile Expense Tax Deductions,
Tax Deductions