The IRS has issued proposed regulations that provide guidance under new provisions added by the Tax Cuts and Jobs Act (TCJA) related to Qualified Opportunity Funds (QOFs). Specifically, the guidance addresses the gains that may be deferred as a result of a taxpayer's investment in a QOF, as well as special rules for an investment in a QOF held by a taxpayer for at least 10 years.
Tax reform through the federal Tax Cuts and Jobs Act created a ton of new tax rules for business owners. So many in fact the IRS in January just released some final regulations on key parts of the act, more than a year after it was enacted.
While there are a lot of tax changes to learn, there is some good news for business owners: Some business tax provisions remained the same or largely so, including business travel deductions.
Tax Reform through the Tax Cuts and Jobs Act provided a new tool for promoting and incentivizing long-term investment in low-income communities.
Opportunity Zones are economically-distressed communities where new investments, under certain conditions, may be eligible for preferential tax treatment.
Learn more about them in this comprehensive Opportunity Zones FAQ from the IRS. Also, see the Lehigh Valley’s Opportunity Zones here.
Congress has yet to tackle several outstanding uncertainties frustrating both businesses and individual taxpayers.
The Tax Cuts and Jobs Act, for example, contains several “glitches” requiring legislative fixes. Congress also has neglected to pass the traditional “extenders” legislation that retroactively extend certain tax relief provisions that expired at the end of an earlier year, in this case 2017.
Topics: 2017 Federal Tax Reform
Tax season 2018 has come and gone. Being the first following the enactment of the sweeping Tax Cuts and Jobs Act, it was one for the accounting history books.
Here’s a few things we learned:
- This act may be the exact opposite of tax simplification.
- Sure, the new 1040 is postcard sized … if you don’t count the six new schedules.
- And you can never drink enough coffee.
While complicated, the Tax Cuts and Jobs Act provided a lot of new tax benefits to businesses, especially those that conducted tax projections and planning.
Restaurant owners who invested in interior improvements in 2018 may be surprised when they receive their 2018 tax returns and see higher than expected tax liabilities. This is a result of an inadvertent drafting error in the Tax Cuts and Jobs Act (TCJA) relating to the depreciation of restaurant improvements.
Before the TCJA, the tax law provided rules for multiple categories of restaurant property assets, many of which were eligible for favorable tax depreciation benefits. To simplify the rules, tax reform consolidated the categories applicable to interior improvements into the single category of Qualified Improvement Property (QIP).
The IRS defines an opportunity zone as an “economically distressed community where new investments may be eligible for preferential tax treatment.” The Treasury has certified nearly 9,000 of these districts across all U.S. states and its territories, including the entire island of Puerto Rico. An opportunity zone designation has the potential to trigger a rush of investment activity and is intended to help revitalize neglected areas.
A qualified opportunity zone fund is an investment vehicle that must invest at least 90 percent of its assets in businesses that operate in a qualified opportunity zone, either by acquiring stock or a partnership interest. The fund can also make direct investments in properties and real estate located within a qualified opportunity zone. REITs and other operators are forming opportunity zone funds to access the capital expected to be generated by this program to acquire and develop properties.
Most businesses will owe less tax for the 2018 tax year than they would have under prior law, thanks to changes brought by the Tax Cuts and Jobs Act. But have you done everything possible to lower your business tax bill for last year?
Even though 2018 is in your review mirror, there are some possibilities for business owners to consider if your return for the last tax year hasn't been prepared yet.
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.
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.