Here are three important questions for S corporation owners: Do you own 100-percent of your S corporation?Is your S corporation a partner in one or more partnerships and does it receive a combination of guaranteed payments and ordinary pass-through income from these partnerships?Do you draw a salary from the S corporation for the services you perform for those … [Read more...]
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Don’t Make This S Corporation Health-Insurance Deduction Mistake
Do you own more than 2-percent of your S corporation? Then be sure to follow the special IRS rules that allow you to deduct your health-insurance premiums. These rules are particularly important if your S corporation employs your parents and/or non-dependent children who don’t own any stock in your corporation. And be aware: If you handle things the wrong way, your … [Read more...]
IRS FAQs on Section 199A: Nasty? Helpful? Wrong?
On April 11, the IRS posted its updated Section 199A Frequently Asked Questions (FAQs). These FAQs were intended to provide helpful information for taxpayers, but instead, they will cause a lot of confusion and grief. Why? Because following the confusing advice of three of the FAQs will ultimately force some taxpayers to file amended tax returns! What’s going on? We’ll … [Read more...]
Caution: 199A Calculator Is Business-by-Business WITHOUT Aggregation
Consider this a personal invitation to use our freeSection 199A Calculator But be sure to use it the correct way! Your 199A deduction requires W-2 wages and/or property (when your taxable income is greater than $415,000 married, filing jointly, or $207,500, filing as single or head of household.) If you earn above these amounts and do not formally elect aggregation of … [Read more...]
TCJA Planning: Terminating Your S Corporation Election
The Tax Cuts and Jobs Act (TCJA) may get you thinking about whether it makes sense to change your form of business entity. Maybe you’re considering turning your S corporation into a C corporation, partnership, or sole proprietorship. If you’re currently running a C corporation, you’ll have to terminate it and elect to switch to another form of business entity. How do … [Read more...]