The 2018 gift tax return deadline is almost here

| Tax Briefs

Did you make large gifts to your children, grandchildren or other heirs last year? If so, it’s important to determine whether you’re required to file a 2018 gift tax return — or whether filing one would be beneficial even if it isn’t required. Filing requirements Generally, you must file a gift tax return for 2018 if, during the tax year, you made gifts: That exceeded the $15,000-per-recipient gift tax annual exclusion (other than to your U.S. citizen spouse); That you wish Read more [...]

Vehicle-expense deduction ins and outs for individual taxpayers

| Tax Briefs

It’s not just businesses that can deduct vehicle-related expenses. Individuals also can deduct them in certain circumstances. Unfortunately, the Tax Cuts and Jobs Act (TCJA) might reduce your deduction compared to what you claimed on your 2017 return. For 2017, miles driven for business, moving, medical and charitable purposes were potentially deductible. For 2018 through 2025, business and moving miles are deductible only in much more limited circumstances. TCJA changes could also affect your Read more [...]

Beware the Ides of March — if you own a pass-through entity

| Tax Briefs

Shakespeare’s words don’t apply just to Julius Caesar; they also apply to calendar-year partnerships, S corporations and limited liability companies (LLCs) treated as partnerships or S corporations for tax purposes. Why? The Ides of March, more commonly known as March 15, is the federal income tax filing deadline for these “pass-through” entities.   Not-so-ancient history   Until the 2016 tax year, the filing deadline for partnerships was the same as that for individual taxpayers: April Read more [...]

Some of your deductions may be smaller (or nonexistent) when you file your 2018 tax return

| Tax Briefs

While the Tax Cuts and Jobs Act (TCJA) reduces most income tax rates and expands some tax breaks, it limits or eliminates several itemized deductions that have been valuable to many individual taxpayers. Here are five deductions you may see shrink or disappear when you file your 2018 income tax return: State and local tax deduction. For 2018 through 2025, your total itemized deduction for all state and local taxes combined — including property tax — is limited to $10,000 ($5,000 if you’re Read more [...]

Depreciation-related breaks on business real estate: What you need to know when you file your 2018 return

| Tax Briefs

Commercial buildings and improvements generally are depreciated over 39 years, which essentially means you can deduct a portion of the cost every year over the depreciation period. (Land isn’t depreciable.) But special tax breaks that allow deductions to be taken more quickly are available for certain real estate investments.   Some of these were enhanced by the Tax Cuts and Jobs Act (TCJA) and may provide a bigger benefit when you file your 2018 tax return. But there are two breaks you might Read more [...]

Why you shouldn’t wait to file your 2018 income tax return

| Tax Briefs

The IRS opened the 2018 income tax return filing season on January 28. Even if you typically don’t file until much closer to the April 15 deadline, this year consider filing as soon as you can. Why? You can potentially protect yourself from tax identity theft — and reap other benefits, too.   What is tax identity theft?   In a tax identity theft scheme, a thief uses your personal information to file a fraudulent tax return early in the filing season and claim a bogus refund.   You discover Read more [...]

What will your marginal income tax rate be?

| Tax Briefs

While the Tax Cuts and Jobs Act (TCJA) generally reduced individual tax rates for 2018 through 2025, some taxpayers could see their taxes go up due to reductions or eliminations of certain tax breaks — and, in some cases, due to their filing status. But some may see additional tax savings due to their filing status. Unmarried vs. married taxpayers In an effort to further eliminate the marriage “penalty”, the TCJA made changes to some of the middle tax brackets. As a result, some single Read more [...]

A refresher on major tax law changes for small-business owners

| Tax Briefs

The dawning of 2019 means the 2018 income tax filing season will soon be upon us. After year-end, it’s generally too late to take action to reduce 2018 taxes. Business owners may, therefore, want to shift their focus to assessing whether they’ll likely owe taxes or get a refund when they file their returns this spring, so they can plan accordingly. With the biggest tax law changes in decades — under the Tax Cuts and Jobs Act (TCJA) — generally going into effect beginning in 2018, most Read more [...]

There’s still time to get substantiation for 2018 donations

| Tax Briefs

If you’re like many Americans, letters from your favorite charities have been appearing in your mailbox in recent weeks acknowledging your 2018 year-end donations. But what happens if you haven’t received such a letter — can you still claim an itemized deduction for the gift on your 2018 income tax return? It depends.   Basic requirements   To support a charitable deduction, you need to comply with IRS substantiation requirements. This generally includes obtaining a contemporaneous written Read more [...]

Consider all the tax consequences before making gifts to loved ones

| Tax Briefs

Many people choose to pass assets to the next generation during life, whether to reduce the size of their taxable estate, to help out family members or simply to see their loved ones enjoy the gifts. If you’re considering lifetime gifts, be aware that which assets you give can produce substantially different tax consequences.   Multiple types of taxes   Federal gift and estate taxes generally apply at a rate of 40% to transfers in excess of your available gift and estate tax exemption. Under Read more [...]