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Lena Rozzi, CPA •

​What is IRC Section 1202?
As an incentive for non-corporate taxpayers to invest in small businesses, Section 1202, Small Business Stock Capital Gains Exclusion, allows for the exclusion of gains associated with Qualified Small Business (QSB) stocks. Section 1202 was initially enacted with the purpose of promoting investments in new ventures and small businesses by allowing taxpayers to exclude 50% of the gain in select small businesses, however, as capital gain rates changed, the Section 1202 exclusion was increased from 50% to 75%, and subsequently to an exclusion of 100%, effective for QSB stocks acquired after September 27, 2010. 

Now that we are into 2019 the Tax Cuts and Jobs Act has some additional tax implications. Previously, alimony was taxable to the recipient but that is no longer the case depending on when your divorce was finalized. 
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Lena Rozzi, CPA •

​The enactment of the Tax Cuts and Jobs Act (TCJA), passed in December 2017, effectively became one of the largest tax reforms in decades, however, there are changes that will leave some taxpayers owing more taxes then they anticipated this year. 

So you’ve prepared your return and you owe the IRS but you don’t have the money to pay. Now what? 
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Andrew Luce, CPA •

A commonly used tax savings strategy is done when an individual or employer makes a contribution to a Health Savings Account (HSA). Luckily, as an individual or employer, you still have time to make a contribution after December 31st to an HSA. For example, a contribution made into your HSA in 2019 might be deductible on your 2018 income tax return. The following information summarizes some key facts about the timing, deductibility, and contribution limits of HSAs:
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Andrew Luce, CPA •

One of the most commonly used tax savings strategies is done when an individual or employer makes a contribution to a retirement plan. Luckily, as an individual or employer, you still have time to make a retirement plan contribution after December 31st to an employer 401(k), solo 401(k), Self-Employed Pension (SEP), or Individual Retirement Account (IRA) and deduct the contribution on your income tax return. For example, a contribution paid into your retirement plan in 2019 might be deductible on your 2018 income tax return.  The following information summarizes some key facts about these retirement plans, including timing and deductibility of retirement plan contributions, among other things:
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Pollyanna King, CPA, MST •

As you pour through your checkbook register and piles of receipts for tax reporting items, you may need to make a list of your 2018 charitable donations. For people who file using the itemized deduction method, and report your donations on Schedule A instead of using the standard deduction, you should have a list with the charity’s name, the date and the amount that was given followed by a grand total for your record of 2018 charitable donations.
 

Lena Rozzi, CPA •

The Tax Cuts and Jobs Act (TCJA), passed in December 2017, was one of the largest tax reforms in decades. Needless to say, it caused numerous changes that affects many individual taxpayers.  Homeowners may notice changes to deductions related to their home mortgage interest effective for the 2018 tax year.
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Andrew Luce, CPA •

​If you are a business owner and keeping tabs on the new tax laws, you’ve likely heard a lot about a QBI (Qualified Business Income) tax deduction and how SSTBs (Specified Service Trade or Businesses) might miss out on this new 20% deduction.  Yes, there is a chance you won’t receive a full 20% deduction if you’re a married business owner, making over $315,000 (the beginning threshold for the QBI tax deduction phase-out), and in healthcare (one of the SSTB classifications), whereas a business owner of a landscaping company will likely fully benefit from this deduction with proper planning.  Before your mind starts racing about the inequalities of the new tax law, we should all be able to agree on at least one thing - the tax rates are lower this year (woohoo!), so it’s not recommended to make less money because you want to qualify for this 20% deduction.  Seriously, this 20% deduction wasn’t around in the past and you weren’t worried about making too much money so why worry about making too much money now when your rates are actually lower.  If you qualify for the deduction it will be gravy on top.  Also, there has been a lot published about this new rule and we are here to help you determine if you will benefit from this deduction but in the meantime keep the dough flowing!  If you’re unsure how this new deduction will impact your business and/or whether or not you’ll be included in the dreaded SSTB category, please feel free to contact me or one of our professionals. 

Alyssa Hodges, CPA •

Now that we’re past the end of 2018, it’s that time of year where you get to pull together all of your tax documents. Your official tax forms may not have started arriving yet, but you can start putting together all of your receipts! I bet you love going through stacks of papers to put medical receipts and charitable deductions in a shoebox for your tax preparer, or maybe you stuff them in an envelope instead. Not so fast! 
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Lena Rozzi, CPA •
IRS Proposes Safe Harbor for Taxpayers Seeking the Section 199A Deduction for Rental Real Estate Activities
 
On January 18, 2019, the IRS released additional guidance on the much anticipated Section 199A deduction as many taxpayers eagerly await the opening of tax season. Among other issues, the guidance offers taxpayers a proposed safe harbor in determining when rental real estate activities can be treated as qualified trade or business for the purpose of taking the Section 199A deduction. This guidance is provided by the IRS in response to taxpayer uncertainty whether rental real estate activities qualify as a trade or business for the purpose of the Section 199A deduction. 
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