Protecting Americans from Tax Hikes Act of 2015 Bonus first-year Depreciation — Qualified property placed in service between 1/01/15 and 12/31/19 is allowed first-year bonus depreciation. The bonus depreciation percentage is 50% for property placed in service between 2015 and 2017, 40% for property placed in service during 2018 and 30% for property placed in service […]
Category: Sub S Corporations
Rental property placed in Service
We are buying a new build vacation rental home. We’ve paid the deposit and the home will be ready in early March. I assume the mortgage interest is deductible (and not the full mortgage payment) in which case I would expect the yield to be circa $1k pm after all deductions. YOU ARE CORRECT, only the […]
Distributions from Sub S – Income?
This example shows why distributions are not income. DISTRIBUTIONS ARE NOT INCOME YOU ARE TAXED ON THE PROFITS OF THE COMPANY WHETHER YOU TAKE A DISTRIBUION OR NOT. Example 1: Let’s say you alone start a new company and you put in $10k. The first year the company makes a profit of $100k. That makes […]
2014 Estimated Tax – Should I Pay It?
2014 Estimated Tax – Sould I Pay It? Depends on what type taxpayer you are. Are you Wanting to pay in the absolute minimum such that next April you may owe a bunch but with no penalty? Or, are you wanting to pay in during the year such come next April 15th you are about even? […]
2014 SIMPLE IRA SET UP
Who: All employers interested in retirement plans (this is what we do) What: Simple IRA’s When: Can sign up until September 30, 2014 for new plans and fund later. Why: Cause you are going to want to retire someday. It is never too early nor too late to start. How Much Can an Employee Contribute: Up to $12,000 per employee […]
Can Unused Rental Losses be Deducted in a Bankruptcy?
Can you deduct unused rental losses in a bankruptcy? LAW: Under IRC § 469(g), current and carryforward passive activity losses are fully deductible in the year of an entire disposition in a fully taxable transaction to an unrelated party. A qualifying disposition may create a Net Operating Loss (NOL) which can be carried back. See IRC § 172 Once […]
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2013 HSA Contribution Limits
2013 HSA (Heath Savings Account) Contribution Limits Self only plan Family plan Under age 55 $3,250 $6,450 Age 55 or over $4,250 $7,450 Age 65 or over (1) n/a n/a (1 (1) This does not mean you cannot contribute during the year. The calculation is done on a monthly basis. You can contribute until you […]
2013 Gift Basket – special tax court case
There is a recent tax court case that applies to gift baskets. For a number of years there has been something called the Production Activities Deduction (PAD). It generally applies to MANUFACTURING. This tax court case may open a deduction for flower shops and other companies that assemble gift baskets. If your bottom line income […]
2013 Form 1099 Late Filing Penalty
This has never been easy to explain…. here is the latest…. The penalties were increased two years ago to the following amounts: $30 per form, or per statement, if it was corrected within 30 days (maximum $250,000 per year), $60 per form, or per statement, if corrected more than 30 days after the filing due […]
Cost Segregation Denied
Cost Segregation is good. It allows faster write off’s via depreciation of buildings. We have clients who have been very satisfied. Taxpayer purchased a business and properly allocated the cost to the various asset classes per the purchase agreement. Then the taxpayer paid for a cost segregation study. It was decided that the the contract’s […]