Here’s more good news from Uncle Sam… The IRS issued final Section 199A regulations that contain some hew and very favorable provisions for out-of-favor specified service trades and businesses. A nice feature of the new regulations are the de minimis rules that allow you to break your out-of-favor business into two or more businesses for the purpose of successfully … [Read more...]
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For 199A Tax Deductions, Must Landlords Give 1099s to Vendors?
It’s a fact… The Tax Cuts and Jobs Act gives you a possible 20-percent tax deduction on your rental property. But that’s only if your rental property is a trade or business, and that comes with its own burdens! For example, Section 199A final regulations stipulate that under tax code Section 6041, a trade or business must issue 1099s to certain vendors. So in … [Read more...]
Tax reform’s new Qualified Opportunity Funds. Helpful or hype?
The Tax Cuts and Jobs Act created a new tax-planning strategy called “Qualified Opportunity Funds.” It was designed to provide a new qualified-opportunity-fund tax-deferral strategy that can also eliminate some capital gains and make others tax-free. Our take on qualified opportunity funds? We believe they do provide an ability to defer (and possibly eliminate) some … [Read more...]
Tax reform sticks it to business startups that lose money
There’s a provision in the Tax Cuts and Jobs Act that we believe is terribly unfair to business start-ups and struggling business owners. You see, the rule prevents you from using all your business losses against non-business income if the losses are considered to be too large. (That determination is made by Congress.) If you want to find out how this onerous new law can … [Read more...]
Seven answers to your Section 199A questions
The Tax Cuts and Jobs Act added a new tax code Section 199A that gives business owners of pass-through businesses a possible 20-percent tax deduction on business income. Sounds good, And it is good. But as you can imagine, some important questions arise that need definitive answers. In this issue of the Tax Reduction Letter we’re going to ask the questions that our … [Read more...]