Employee outings and parties are commonly used to build a positive company culture and reduce employee turnover rates. They’re also opportunities for the boss to get a break from the daily grind, and for a CPA to claim additional deductions for the business. The tax savings for employee outings has indeed survived the Tax Cuts…
Miscellaneous
Partnership QBI: Calculating and Improving It
For the Section 199A 20% tax deduction, profit distributions from partnerships are considered to be qualified business income (QBI). General partners are taxed based on these profit distributions, as well as guaranteed payments. Although the tax code is quite complicated in this area, it is possible to increase one’s QBI by increasing the profit distributions,…
When Can You Shred Your Personal Tax Documents?
Springtime isn’t just tax time—for many people, it’s also time to do spring cleaning. If you’re looking to clean out your files and get a fresh start, you may be wondering if it’s OK to shred your old tax documents. How long do you have to hold on to your past tax returns and your…
A Look at Qualified Opportunity Funds
One of the tax planning strategies introduced by the Tax Cuts and Jobs Act of 2017 is qualified opportunity funds. By using these funds, you can defer any capital gains from the current year and then make the capital gains on your new investment tax-free. In order to do this, it’s important to understand how…
How the Recent Tax Changes Affect the Kiddie Tax
If your children have any unearned income, then your family may be affected by the so-called “kiddie tax.” How does the Tax Cuts and Jobs Act of 2017 affect you and your children? As you’ll see, tax planning can help you ensure that the impact on your family is minimal. First, it’s important to understand…
Crystal Royce Honored at 2018 Executive Excellence Awards
It’s always nice to be recognized for your hard work. That’s why Tucson Local Media and Inside Tucson Business have created the Executive Excellence Awards. The team here at the Royce CPA Firm recently attended the 2018 Executive Excellence Awards, and we had a wonderful time! This year’s Executive Excellence Awards took place at the…
A Look at Family Tax Deduction Strategies
How does having a family affect your end-of-the-year tax calculations? The answer is: It depends! Whether you’re married or divorced, have kids or are childless, or are supporting any of your relatives, here are some tax strategies to keep in mind for the coming year. If your children work for you, treat them as employees….
Stock Portfolio Tax Strategies for the End of 2018
Are you planning your year-end stock portfolio? If not, there’s a very good reason you might want to do so—it can end up paying off! As long as you know how to handle your stock portfolio wisely, you can come up with a smart year-end tax strategy. Your goals are to steer clear of the…
The Royce CPA Firm at QB Connect 2018
We headed to San Jose earlier this month to attend QB Connect and we had an incredible time! Our team enjoyed hearing featured speakers like Mindy Kaling and Alex Rodriguez share their knowledge, and we had a great time exploring, learning, and networking. You can read about this year’s conference and get a snapshot of…
IRS Changes Rule on Deductions for Business Meals
In a much-welcome development, the Internal Revenue Service has announced that both client and prospect business meals are now considered to qualify as tax deductions, in keeping with the Tax Cuts and Jobs Act of 2017. But what exactly does the new rule mean for you? Under the new guidelines from the IRS, you are…
Tax Time Bomb: Passive Foreign Investment Companies
Passive foreign investment companies, or PFICs, are subject to some of the most complex provisions of the tax law. You may own one and not even know it. A passive foreign investment company is any foreign corporation for which: 75 percent or more of its gross income for the tax year is from passive income,…
How Cost Segregation Can Turn Your Rental into a Cash Cow
Cost segregation breaks your real property into its components, some of which you can depreciate much faster than the typical 27.5 years for a residential rental or 39 years for nonresidential real estate. When you buy real property, you typically break it into two assets for depreciation purposes: land, which is non-depreciable; and building (residential…
Tax Implications of Goodwill
Here’s a primer to help you avoid confusion about goodwill: As the seller, you have self-created goodwill when the total sales price of your business exceeds the fair market value of its assets, both tangible and intangible. You have acquired goodwill when you purchase the assets of another company for more than the value of…
How to Deduct Your Legal Fees after Tax Reform
The Tax Cuts and Jobs Act (TCJA), known as tax reform, made it more difficult for you to deduct your legal fees. The new tax reform law suspended (killed is a better word) your legal fees as 2 percent miscellaneous itemized deductions for tax years 2018 through 2025. This means you need to look for…
Divorce? Alimony? Tax Reform Says Get Divorced Now—Don’t Wait
Tax reform changes the alimony game. This may or may not have any relevance to you, but if it does, you will want to move quickly. The Tax Cuts and Jobs Act (TCJA) eliminates tax deductions for alimony payments that are required under post-2018 divorce agreements. More specifically, the TCJA’s new denial of alimony tax…
Good News: Tax Reform Lands a Blow to AMT
Tax reform made changes to the tax law that significantly impact the alternative minimum tax (AMT). The changes could mean more money in your pocket and less going to the government. If you own a C corporation, then you are the big AMT winner: Tax reform completely eliminated AMT for C corporations. C corporations are…
Tax Reform Increases the Tax Benefits of Employing Your Child
The recent tax reform eliminated personal exemptions for taxable years after December 31, 2017, and before January 1, 2026. This makes your child worth less to you on your Form 1040. But there is a way to get even or, perhaps, much more than even. Let’s set the stage first. For taxable years after December…
Proving Travel Expenses after Tax Reform
As you likely know by now, your travel meals continue under tax reform as tax-deductible meals subject to the 50 percent cut. And tax reform did not change the rules that apply to your other travel expense deductions. One beauty of being in business for yourself is the ability to pick your travel destinations and…
Tax Reform Punishes W-2 Employees—Get Even!
The recent tax reform added new tax code Section 67(g), which states, “No miscellaneous itemized deduction shall be allowed for any taxable year beginning after December 31, 2017, and before January 1, 2026.” Let’s say you are a W-2 mortgage banker paid on a commission basis, and during 2018, you will incur $27,000 of employee…
New Court-Approved Way to Defeat IRS Penalties
You hate IRS penalties, right? Everyone does! There are a lot of strategies we can use on your behalf to potentially defeat an IRS penalty. Thanks to the courts, though, we now have a brand-new way to beat an IRS penalty. It’s Section 6751(b) of the Internal Revenue Code. This provision can get you out…