We are all familiar with the annual tax filing ritual; around January, most people collect their tax documents to file their tax returns by the deadline. However, some people sometimes or always need an extension. All of the information is gathered after the tax deadline of April and filed before the extension deadline. There is another group of people, that don’t meet the extended deadline, and their tax return is late and unfiled....
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Qualified medical expenses are deductible to the extent that they exceed 7.5% of your adjusted gross income (AGI) for 2018 and 2019. Starting 2020, the deductibility threshold increases to 10% of your AGI. AGI is the bottom number on the first page of your personal income tax return (Form 1040). What are Medical Expenses? Medical care expenses include payments for the diagnosis, cure, mitigation, treatment, or prevention of...
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Tax reform made a lot of good changes in the tax law for the small-business owner. But the changes to the net operating loss (NOL) deduction rules are not in the good-changes category. They are designed to hurt you and put money in the IRS’s pocket. Now, if you have a bad year in your business, the new NOL rules are designed to stop you from using your business loss to find some immediate cash. The new (let’s call them bad-for-you)...
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The first good news is that you can be both real estate investor and real estate dealer with respect to your real estate portfolio. The next good news is that you are in control, and by knowing just a few rules about dealer and investor classifications, you can do much to increase your net worth. Let’s take a quick look at how big a difference you can make in the tax bite. Say you have a $90,000 profit on the sale of a property. •...
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You likely have heard conflicting information on the deductibility of business meals with clients and prospects. I have spent time researching this issue, and my conclusion is that tax reform eliminated tax deductions for business meals with clients and prospects. Before the 2017 The Tax Reform Act there were two conditions to client and prospect meals: Required you to establish that the meal was directly related...
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