Most taxpayers find that keeping accurate records is a pain in the neck. But failing to keep these records can cost you a tremendous amount of money. That could be true even when it comes to tracking what you’ve spent over the years on home improvements. We’ve run the numbers on the Pendergrafts and discovered that they avoided just fifteen hours of paperwork that cost … [Read more...]
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Avoid an audit: Fix the 1099 prepaid-rent mismatch
Did you prepay your 2019 rent so you could claim a big 2018 tax deduction? That could be a very smart more. Or it could open the door to huge problems for you and your landlord. You see, if you prepare your 1099-MISC based on your checkbook or payment ledgers, it’s very possible you’ll create an incorrect 1099 for your landlord. And an incorrect 1099 that overstates the … [Read more...]
De minimis or 179 expensing, or bonus depreciation?
Thanks to the Tax Cuts and Jobs Act, you now have three ways to write off the entire cost of certain business assets. Which is the best method for you to use? Let’s take a look … Behind door #1 is bonus depreciation. You can use it to deduct 100-percent of the cost of certain business assets. Behind door #2 is the de minimis safe harbor for certain assets costing … [Read more...]
Update on claiming business-deductions for work-related education
Continuous education can be extremely valuable for you and your employees. But when it comes to deducting the cost of continuous work-related education, the Tax Cuts and Jobs Act has proven rather unhelpful. In fact, the law has made some unpleasant changes you really need to know about. You’ll get a tremendous amount of timely, important information when you read my new … [Read more...]
The IRS allows client and prospect business-meal deductions
Here’s good news from the IRS. You read that right. Good news! You see, in Notice 2018-76 the IRS states that client and prospect business meals continue as tax deductions under the Tax Cuts and Jobs Act. As we’ve mentioned in past issues of the Tax Reduction Letter, the Tax Cuts and Jobs Act eliminated entertainment deductions. But thanks to Notice 2018-76, that’s … [Read more...]