Archive for IRS Tax Rules

Budget Act of 2018 (BBA) Extended Credits – Residential Energy Credits – Form 5695

IRS - Residential Energy Tax Credits

Budget Act of 2018 (BBA) Extended Credits 

The BBA reinstated the nonbusiness energy property credit for 2017, and it reinstated the residential energy efficient property credit for qualified small wind energy property costs, qualified geothermal heat pump property costs, and qualified fuel cell property costs to the end of 2021.

You may claim these credits on your 2017 tax return if you otherwise meet the criteria. If you have already filed your return, you will need to file an amended return (Form 1040X) to claim these credits.

Purpose of Form

Use Form 5695 to figure and take your residential energy credits. The residential energy credits are:

  • The residential energy efficient property credit, and
  • The nonbusiness energy property credit.

Also use Form 5695 to take any residential energy efficient property credit carryforward from 2016 or to carry the unused portion of the credit to 2018.

Who Can Take The Credits

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IRS Issues Proposed Regulations On New 20 Percent Deduction For Passthrough Businesses

IRS Proposed Regulations On Passthrouhg Deductions

The Internal Revenue Service issued proposed regulations for a new provision allowing many owners of sole proprietorships, partnerships, trusts and S corporations to deduct 20 percent of their qualified business income.

The new deduction — referred to as the Section 199A deduction or the deduction for qualified business income — was created by the Tax Cuts and Jobs Act. The deduction is available for tax years beginning after Dec. 31, 2017. Eligible taxpayers can claim it for the first time on the 2018 federal income tax return they file next year.

The deduction is generally available to eligible taxpayers whose 2018 taxable incomes fall below $315,000 for joint returns and $157,500 for other taxpayers. It’s generally equal to the lesser of 20 percent of their qualified business income plus 20 percent of their qualified real estate investment trust dividends and qualified publicly traded partnership income or 20 percent of taxable income minus net capital gains.

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Tax Professionals – Do You Know The Answer To This Tax Question?

Tax Question, Rental Sublease
Personal apartment is sublet 4 out of 12 months in 2017 & 2018. Would profit motive be required for Sec. 212/Schedule E deductibility?
Sec. 183 would seem to apply. See analogous example of rental situation at T.Reg. 1.183-1(d)1 Here sublet rental income (fmv) – rent expense (due landlord) = 0, so no profit expected either year.
Taxpayer will be better off economically than if no subletting, but that doesn’t seem to be considered a profit to meet Sec. 212 &183 requirements.


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