With the divorce rate hovering just below 50 percent, divorce is a painful reality for many people both emotionally and financially. The last thing on anyone’s mind is the effect a divorce or separation will have on their tax situation. Furthermore, most court decisions do not take into account the effects divorce or separation has on your tax situation, which is why it’s always a good idea to speak to an accounting professional before anything is finalized.
October 1 Deadline to Set up SIMPLE IRA Plans
Of all the retirement plans available to small business owners, the SIMPLE IRA plan (Savings Incentive Match PLan for Employees) is the easiest to set up and the least expensive to manage. The catch is that you’ll need to set it up by October 1st. Here’s what you need to know.
Who Can Represent You Before the IRS?
Many people use a tax professional to prepare their taxes. Anyone who prepares, or assists in preparing, all or substantially all of a federal tax return for compensation is required to have a valid Preparer Tax Identification Number (PTIN). All enrolled agents must also have a valid PTIN.
If you choose to have someone prepare your federal tax return, then you should know who can represent you before the IRS if there is a problem with your return. Here’s what you should know:
Avoid Refund Delays by Renewing Expiring ITINs Now
ITINs (Individual Taxpayer Identification Numbers) are used by people who have tax filing or payment obligations under U.S. law but who are not eligible for a Social Security number. Under the Protecting Americans from Tax Hikes (PATH) Act, ITINs that have not been used on a federal tax return at least once in the last three consecutive years will expire Dec. 31, 2019. Furthermore, ITINs with middle digits 83, 84, 85, 86 or 87 that have not already been renewed will also expire at the end of the year. Others do not need to take any action.
Higher Ed Institutions Affected by Proposed Regulations
Proposed regulations were issued by the IRS on June 18, 2019, regarding the new 1.4 percent excise tax on the net investment income of certain private colleges and universities. While the new excise tax is estimated to affect 40 or fewer institutions, it applies to any private college or university that has at least 500 full-time tuition-paying students (more than half of whom are located in the U.S.) and that has assets other than those used in its charitable activities worth at least $500,000 per student.
TCJA Tax Reform Sticks It to Business Start-Ups That Lose Money
There’s a provision in the Tax Cuts and Jobs Act (TCJA) tax reform that hurts business start-ups and struggling business owners. And no one is really talking about it. This rule prevents you, the business owner, from using all your …
List of Preventive Care Benefits Expanded for HSAs
The list of medical care services for a range of chronic conditions allowed to be provided by a high deductible health plan (HDHP) was expanded effective July 17, 2019. These medical services and items are limited to the specific medical care services or items listed for chronic conditions including hypertension, congestive heart failure, osteoporosis, asthma, depression, liver disease, and diabetes. Any medical care previously recognized as preventive care for these rules is still treated as preventive care.
Tax Deductions for Teachers and Educators
Educators can take advantage of tax deductions for qualified out-of-pocket expenses related to their profession such as classroom supplies, training, and travel. As such, as the new school year begins, teachers, administrators, and aides should remember to keep track of education-related expenses that could help reduce the amount of tax owed next spring.
Prior to tax reform, educators could choose one of two methods for deducting qualified expenses: Claiming the Educator Expense Deduction (up to $250) or, for those who itemized their deductions, claiming eligible work-related expenses as a miscellaneous deduction on Schedule A, Itemized Deductions.
Tax Deduction for Classic or Antique Cars Used in Business
Question
I enjoy your articles on the dollars-and-cents aspects of buying antique furniture for use in a business.
It would be interesting if you could give an example of, say, buying an antique or a classic car versus a new car as a business-use vehicle. Let’s say a 1972 Pontiac GTO versus a 2019 Lexus GS.
New Opportunities for Deferring Taxable Gains: Qualified Opportunity Zones 101
What are Qualified Opportunity Zones and how can I benefit as a taxpayer?
Recently, I’ve had many clients – individuals, business owners, and investors – ask me about the recent buzz surrounding Qualified Opportunity Zones (QOZs). They’ve come to me saying they’ve heard that QOZs can help them defer…and even reduce…their tax liability on capital gains.
The first thing I tell them is, yes, all of the above is true. Next? I warn them that it’s complicated, like many of the tax regulations that have emerged from 2018’s Tax Cuts and Jobs Act. You must consult with a qualified CPA to ensure you’re following proper protocol required for reaping the rewards of investing in a Qualified Opportunity Zone.