4Thought Blog


Mergers and Acquisitions: Post Tax Reform Business Buying Strategies

Posted by Concannon Miller on Thu, Mar 14, 2019

Many businesses will pay less federal income taxes in 2018 and beyond, thanks to the Tax Cuts and Jobs Act. And some will spend their tax savings on merging with or acquiring another business.

Before you jump on the M&A bandwagon, it's important to understand how your transaction will be taxed under current tax law.

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Topics: Business consulting, Business Valuation, 2017 Federal Tax Reform

Strategic Tax Planning Tips to Lower Business Tax Liability

Posted by Concannon Miller on Thu, Feb 21, 2019

More than a year after sweeping federal and state tax reform were enacted, businesses of all sizes are still wrapping their arms around the changes.

Additional guidance and regulations have been issued nearly every month — indeed, change is the new normal. Strategic tax planning now is key to lowering businesses’ total tax liability.

Read on for eight top planning opportunities and considerations businesses should review as part of their 2019 strategy.

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Topics: Business tax planning, 2017 Federal Tax Reform

Should a McDonald’s Franchisee be a C Corp? Pros & Cons

Posted by Ryan Moore on Thu, Feb 7, 2019

Now that tax reform through the Tax Cuts and Jobs Act of 2017 is no longer breaking news, it’s time we take a closer look at a question that arose for McDonald’s franchisees as a result of the change in the tax law.

One of the headline reforms of the new legislation was the slashing of the corporate tax rate from the graduated maximum of 35% to a flat 21%. This begged the question, “Is it now more beneficial for a McDonald’s Owner/Operator to be a C Corporation than a pass-through S Corporation?”

Without examining the merits of the latter choice of entity type, let us instead lay out some (but not all) of the pros and cons of operating your McDonald’s business as a C Corporation.

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Topics: McDonald's management, 2017 Federal Tax Reform

IRS: Rental Real Estate Owners Qualify for QBI; Other New Rules

Posted by Concannon Miller on Tue, Jan 29, 2019

When President Trump signed into law the Tax Cuts and Jobs Act in December 2017, much was made of the dramatic cut in corporate tax rates. But the TCJA also includes a generous deduction for smaller businesses that operate as pass-through entities, with income that is “passed through” to owners and taxed as individual income.

The IRS issued proposed regulations for the qualified business income (QBI), or Section 199A, deduction in August 2018. Now, it has released final regulations and additional guidance, just before the first tax season in which taxpayers can claim the deduction. Among other things, the guidance provides clarity on who qualifies for the QBI deduction and how to calculate the deduction amount.

The new rules include important clarifications for rental real estate owners, service businesses and the owners of multiple businesses. Read on for the important clarifications.

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Topics: Business tax planning, 2017 Federal Tax Reform

IRS Waives Penalties for Many on 2018 Withholding, Estimated Tax Payments

Posted by IRS on Thu, Jan 17, 2019

The IRS this week announced it is waiving the estimated tax penalty for many taxpayers whose 2018 federal income tax withholding and estimated tax payments fell short of their total tax liability for the year.

The IRS is generally waiving the penalty for any taxpayer who paid at least 85 percent of their total tax liability during the year through federal income tax withholding, quarterly estimated tax payments or a combination of the two. The usual percentage threshold is 90 percent to avoid a penalty.

This relief is designed to help taxpayers who were unable to properly adjust their withholding and estimated tax payments to reflect an array of changes under the Tax Cuts and Jobs Act, the far-reaching tax reform law enacted in December 2017. 

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Topics: Individual tax planning, 2017 Federal Tax Reform

Gift of MAGI? Tax planning can help!

Posted by Concannon Miller on Tue, Dec 11, 2018

The IRS has announced its 2019 cost-of-living adjustments to tax items that might affect you. Many of the amounts increased to account for inflation, but some remained at 2018 levels. As you implement 2018 year-end tax planning strategies, be sure to take these 2019 adjustments into account in your planning.

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Topics: Individual tax planning, 2017 Federal Tax Reform

Still Time to Lower Your Personal Tax Bill

Posted by Concannon Miller on Tue, Nov 27, 2018

Have you thought about your personal tax situation for 2018? In addition to reviewing the adequacy of your payroll withholdings and estimated tax payments, there's still time to employ some tax-savvy moves that could potentially decrease this year's tax bill. Tax reform legislation has changed the rules of the game, so it's important to discuss end-of-year strategies with your tax advisor as soon as possible. 

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Topics: Individual tax planning, 2017 Federal Tax Reform

Tax Moves for 2018: Act Now! Time’s Running Out!

Posted by Concannon Miller on Fri, Nov 23, 2018

The passage of the Tax Cuts and Jobs Act (TCJA) in late 2017 brought significant changes to the tax landscape. As the first tax season under the law looms on the horizon, new year-end tax planning strategies are emerging. Meanwhile, some of the old tried-and-true strategies have changed and others remain viable.

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Topics: Business tax planning, Business consulting, 2017 Federal Tax Reform

Act Now to Cut Your 2018 Tax Bill

Posted by Concannon Miller on Tue, Nov 6, 2018

The Tax Cuts and Jobs Act (TCJA) created more than 100 new tax provisions — a staggering thought as you begin to prepare for the next filing season. The good news is that these and some of the surviving provisions create a wealth of year-end planning opportunities.

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Topics: Individual tax planning, 2017 Federal Tax Reform

The QBI Deduction: The Newest Rules for Business Owners

Posted by Tony Deutsch on Tue, Oct 16, 2018

The recent federal tax reform measures included a new deduction offering possibly the greatest tax benefit to pass-through businesses in more than 60 years.

The Qualified Business Income Deduction – or QBI – allows qualified small business owners to simply not pay income taxes on 20% of their income in tax years 2018 through 2026.

Like many provisions in the federal tax code, there are of course stipulations. Restrictions kick in to reduce the benefit when a taxpayer’s income rises and there are a different set of qualifications for Specified Service Trades or Businesses (SSTB).

Late this summer, the IRS released new proposed regulations intended to clear up some of the QBI deduction rules. These regulations provided guidance how owners of multiple businesses can use aggregation to affect their deduction and the definition of SSTBs, which face deduction limitations.

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Topics: Business tax planning, 2017 Federal Tax Reform

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