4Thought Blog

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.

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.

Do you have long-term capital gains or qualified dividends? If so, there's good news: After the Tax Cuts and Jobs Act, you might still qualify for the 0% federal income tax rate on these types of income.

The rate is only available for those with relatively low income. But, if your income is too high to benefit, your children, grandchildren or other loved ones may still be eligible for the tax savings. Here are the details.

The U.S. House Ways and Means Committee last week passed three separate bills that will be the cornerstone of what is being referred to as Tax Reform 2.0.

The bills focus on making permanent certain provisions of the Tax Cuts and Jobs Act that affect individuals, families, and small businesses. They also promote family and retirement savings and new business innovation. For example, one proposal would allow new businesses to write off more of their initial start-up costs. Here’s a brief overview of the three bills.

In recent weeks, the IRS has issued a series of proposed regulations to help clarify provisions of the Tax Cuts and Jobs Act. One of the most controversial parts of the law is the limit on individuals' deductions for state and local taxes that goes into effect this year.

In the wake of the TCJA, lawmakers in some high-tax states have enacted charitable contribution "workarounds" to preserve federal tax breaks for their residents. Earlier this summer, several states — New York, New Jersey, Connecticut and Maryland — filed a lawsuit against the U.S. Department of Treasury and the IRS, alleging that the SALT limitation is an "unconstitutional assault on states' sovereign choices."

One of the most valuable tax breaks in the Tax Cuts and Jobs Act is the new deduction for up to 20% of qualified business income from pass-through entities.

The IRS recently issued proposed regulations that help clarify who can benefit from the deduction. One of the issues the regs clarify is how taxpayers can elect to aggregate, or combine, their trades or businesses for purposes of the QBI deduction (also called the pass-through or Section 199A deduction).

Thanks to changes included in the Tax Cuts and Jobs Act, many more businesses can now use the simpler and more-flexible cash method of accounting for federal income tax purposes. The new law also includes some other tax accounting changes that are good news for small businesses. Like many TCJA changes that apply to businesses, these provisions are permanent. Here's what you need to know.

The IRS recently released highly anticipated regulations addressing the deduction for up to 20% of qualified business income (QBI) from pass-through entities. The deduction was a major component of the Tax Cuts and Jobs Act, which became law late last year. It has also been referred to as the pass-through deduction, the QBI deduction or the Section 199A deduction.

Federal tax reform through the Tax Cuts and Jobs Act significantly expands bonus depreciation under Section 168(k) of the Internal Revenue Code for both regular tax and alternative minimum tax purposes. Now, the IRS has released proposed regulations that clarify the requirements that businesses must satisfy to claim bonus depreciation deductions.

Although the regs are only proposed at this point, the IRS will allow taxpayers to rely on them for property placed in service after September 27, 2017, for tax years ending on or after September 28, 2017.

For tax years starting in 2018, the Tax Cuts and Jobs Act (TCJA) provides new and improved tax incentives for buying new and used business equipment. But leasing still offers benefits for some taxpayers. Here are some important considerations when deciding whether to buy or lease equipment.