The Tax Cuts and Jobs Act (TCJA) tax reform added new tax code Section 199A, which created a 20 percent tax deduction possibility for you if your rental property (a) has profits and (b) can qualify as a trade or business.
Tax FOMO: Are You Losing $1,000s in Tax Savings?
The Power of Hiring a CPA (And What Could Happen if You Don’t)
You know about FOMO or “fear of missing out” when it comes to skipping a good party. You should also have a very healthy fear of losing out on tax savings. How? By trusting anyone other than a qualified CPA to handle your taxes!
While we are a NYC-based CPA firm, our clients are national and international.
IRS “Safe Harbor” for Section 199A Rental Properties
Safe harbor! It sounds wonderful.
Obviously, you are going to be comfortable in a safe harbor. And if you said you don’t want comfort, you might be thought of as a little loony.
You may sense that we are not jumping with joy about this new safe harbor for Section 199A rental property. It’s true; our joy quotient is a little low on this safe harbor because of the work involved.
Our feeling is that you did this work, so your property is a trade or business with no safe harbor needed. Of course, the safe harbor gives you comfort, so we need to examine what’s involved.
With the new safe harbor, the IRS thinks it is your new friend when it comes to claiming the Section 199A 20 percent tax deduction on your rental real estate profits.
What Is the Saver’s Credit?
The Retirement Savings Contributions Credit, also known as the Saver’s Credit, is a special tax credit for low-and moderate-income workers. In tax year 2020, the most recent year for which complete figures are available, Saver’s Credits totaling more than $1.7 billion were claimed on about 9.4 million individual income tax returns. That’s an average of about $186 per eligible return.
Taxable vs. Nontaxable Income
Are you wondering if there’s a hard and fast rule about what income is taxable and what income is not? The quick answer is that all income is taxable unless the law specifically excludes it. But as you might have guessed, there’s more to it than that.
Taxable income includes any money you receive, such as wages, tips, and unemployment compensation. It can also include noncash income from property or services. For example, both parties in a barter exchange must include the fair market value of goods or services received as income on their tax return.
Unemployment Tax Break Refunds Issued for 2020
Final corrections for taxpayers who overpaid their taxes on unemployment compensation received in 2020 have been completed by the IRS. Approximately 14 million returns were corrected, resulting in nearly 12 million refunds totaling $14.8 billion.
Tax Breaks for Older Adults and Retirees
Everyone wants to save money on their taxes, and retirees and older adults are no exception. If you’re 50 or older, here are six tax tips that could help you do just that.
Standard vs. Itemized Deductions
When completing a tax return, taxpayers have two options: take the standard deduction or itemize their deductions. Most taxpayers use the option that gives them the lowest overall tax. Due to all the tax law changes in recent years, including increases to the standard deduction, that means taking the standard deduction – but not always. Let’s look at a few details about these two options.
What Is a Designated Roth Account?
Many 401(k) plans allow taxpayers to make Roth contributions as long as the plan has a designated Roth account. Your plan may also allow you to transfer amounts to the designated Roth account in the plan or borrow money.
What Businesses Need To Know About the Excise Tax
Excise tax is an indirect tax on specific goods, services, and activities. Federal excise tax is usually imposed on the sale of things like fuel, airline tickets, heavy trucks and highway tractors, indoor tanning, tires, tobacco, and other goods and services.