Archives for deduction

New Law Tax Workaround for CA Pass-Through Business Owners

July 27, 2021 | by | Comments Off on New Law Tax Workaround for CA Pass-Through Business Owners

Richard A. Huffman, CPA, MST Tax Partner   The 2017 Tax Cut and Jobs Act limits individuals state and local tax deduction to $10,000 a year through 2025. California passed into law a workaround for tax years 2021- 2025. Qualifying pass-through business owners can separately elect to pay a 9.3% entity level tax on the owner’s share of the company’s qualified taxable income which will be allowed as a federal tax deduction on the entity return. Owners who participate will receive a credit on their California individual tax return equal to the 9.3% tax paid at the entity level.  The
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Categories: Industry News and Newsletter and Updates.
Tags: accountant, accountants, accounting, accounting firm, business, business owner, ca, california, certified public accountants, cpa, cpa firm, deduction, firm, irvine, law, newsletter, oc, orange county, passthrough entity, small business, so cal, southern california, tax, tax firm, tax workaround, taxation, taxes, wfy, wright ford young, and wright ford young & co.

Tax Update on Business Meals Being 100% Deductible in 2021

June 15, 2021 | by | Comments Off on Tax Update on Business Meals Being 100% Deductible in 2021

Angela Tang, CPA Estate & Trust Supervisor   The cost of business meals were considered a deductible expense since 1986, the problem is only 50% of such costs were allowed as a deduction until now.  The latest 2020 stimulus bill saw many changes and one of the which is the business meal deduction.  A temporary exception for 2021-2022 is the 100% business meal deduction for meals “provided by a restaurant.”  The government is attempting to help the restaurant industry impacted by the Covid-19 shutdown by intentionally incentivizing business owners to patronize restaurants. In order to qualify for the business meal
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Categories: Industry News and Newsletter and Updates.
Tags: accountant, accountants, accounting, accounting firm, business, business meal, business meal deductible, business meal deduction, ca, california, certified public accountants, coronavirus, covid, covid19, cpa, cpa firm, deductible, deduction, expense, firm, IRS, irvine, oc, orange county, pandemic, reimbursement, restaurants, small business, so cal, southern california, tax, tax firm, taxation, taxes, wfy, wright ford young, and wright ford young & co.

Making Large Gifts Now Won’t Harm Estates After 2025

November 29, 2018 | by | Comments Off on Making Large Gifts Now Won’t Harm Estates After 2025

On November 20th, the IRS announced individuals taking advantage of the increased gift and estate tax exclusion amounts in effect from 2018 to 2025 will not be adversely impacted after 2025 when the exclusion amount is scheduled to drop to levels before 2018. The Treasury Department and the IRS issued proposed regulations which implement changes made by the 2017 Tax Cuts and Jobs Act (TCJA).  As a result, individuals planning to make large gifts between 2018 and 2025 can do so without concern that they will lose the tax benefit of the higher exclusion level once it decreases after 2025.
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Categories: Industry News and Newsletter and Updates.
Tags: accountant, accountants, accounting, audit, business, ca, california, certified public accountants, cpa, cpa firm, deduction, estate, estate and trusts, estates, exclusion, firm, IRS, tax, tax firm, tax reform, taxation, taxes, TCJA, trusts, wfy, wright ford young, and wright ford young & co.

Tax Saving Moves to Improve Your Tax Situation

November 29, 2018 | by | Comments Off on Tax Saving Moves to Improve Your Tax Situation

Since 2018 is coming to a close now is the time to take action to proactively reduce your tax liability before the new year.  Included are a few strategies that may help with your tax situation: Harvest stock losses while substantially preserving one’s investment position. This can be accomplished by selling the shares and buying other shares in the same company or another company in the same industry to replace them, or by selling the original shares, then buying back the same securities at least 31 days later. Apply a bunching strategy to deductible contributions and/or payments of medical expenses. Beginning
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Categories: Industry News and Newsletter and Updates.
Tags: accountant, accountants, accounting, audit, ca, california, certified public accountants, contributions, cpa, cpa firm, deduction, distributions, gifts, ira, qcd, rmd, stock, tax, tax firm, tax specialists, taxation, taxes, wfy, wright ford young, and wright ford young & co.

Pass-Through Entities and the 20 Percent Tax Break

January 23, 2018 | by | Comments Off on Pass-Through Entities and the 20 Percent Tax Break

Small-business owners and partners are scratching their heads over the Tax Cuts and Jobs Act and how the new 20 percent tax deduction for pass-through entities will work. Here’s a little background A pass-through entity can be a partnership, S corporation, limited liability company or partnership, or sole proprietorship — basically, most of the country’s small businesses. Owners and shareholders of these entities are taxed on earnings based on individual, not corporate, tax rates. Effectively, company earnings, losses and deductions pass through to the individual’s personal tax rates, which, in the past, were typically lower than corporate rates. The pass-through
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Categories: Newsletter and Updates.
Tags: business, corporate, deduction, income, investments, pass-through, qbi, shareholders, tax, tax break, tax cuts and jobs act, taxation, trusts, wfy, wright ford young, and wright ford young & co.

Bracket Changes and More From the IRS

December 13, 2017 | by | Comments Off on Bracket Changes and More From the IRS

You haven’t even filed your 2017 taxes yet, but the IRS has already announced changes that will affect your 2018 taxes, which you’ll be filing in 2019. The changes were announced in Revenue Procedure 2017-58, which runs 28 pages, but below are some key points. How do these changes impact you? Of course, if any meaningful tax reform is passed, anything can be changed. We’ll keep you posted on any developments that affect you. The standard deduction for married filing jointly rises to $13,000 for tax year 2018, up $300. For single taxpayers and married individuals filing separately, the standard deduction
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Categories: Industry News and Newsletter and Updates.
Tags: cpa, deduction, exemption, tax, tax bracket, taxation, taxpayers, wfy, and wright ford young.

Senate Tax Plan Outline Released

November 15, 2017 | by | Comments Off on Senate Tax Plan Outline Released

The Senate Republican’s tax reform plan was released last week. Several proposals changed from the House Tax bill. The key changes in the plan from the current law are as follows: Individuals: Current tax rates: Seven brackets from 10% to 39.6%. Proposed tax rates: Seven brackets at 10%, 12%, 22.5%, 25%, 32.5%, 35% and 38.5%. Current standard deduction: $6,350 individuals and $12,700 married filing joint. Proposed standard deduction: $12,000 individuals and $24,000 married filing joint. Elimination of personal exemptions, worth $4,050 per person. Increase child tax credit from $1,000 to $1,650 and add a $500 credit for nonchild dependents. Eliminate
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Categories: Industry News and Newsletter and Updates.
Tags: bill, cpa, deduction, house bill, individuals, proposals, senate bill, tax, tax reform, wfy, and wright ford young.