Deductibles | TaxConnections

28 May 2018

IRS Clarifies Interest On Home Equity Loans Can Still Be Deductible

In an Information Release, IRS has announced that in many cases, taxpayers can continue to deduct interest paid on home equity loans under the recently enacted Tax Cuts and Jobs Act.

Taxpayers may deduct interest on mortgage debt that is “acquisition debt.” Acquisition debt means debt that is: (1) secured by the taxpayer’s principal home and/or a second home, and (2) incurred in acquiring, constructing, or substantially improving the home. This rule hasn’t been changed by the Tax Cuts and Jobs Act.

Under pre-Tax Cuts and Jobs Act law, the maximum amount that was treated as acquisition debt for the purpose of deducting interest was $1 million ($500,000 for marrieds filing separately). Under the Tax Cuts and Jobs Act, for tax years beginning after Dec. 31, 2017, and before Jan. 1, 2026, the limit on acquisition debt is reduced to $750,000 ($375,000 for a married taxpayer filing separately).

Written by Lisa Nason | Posted in Deductibles • Deductions • Home Equity Loan • IRS

25 May 2018

Tax Advantages To Owning A Second Home

No matter the location, size, or value of a second home, certain tax advantages are built in. However, your opportunity to benefit from them depends on how you use the property.

Personal Use

Both property taxes and mortgage interest are as deductible for a second home as they are for your primary residence — and are subject to the same limitations. If you file a joint return, you cannot deduct interest on more than $1 million of acquisition debt ($500,000 for married persons filing separately) on one or two homes.

Two tax advantages of homeownership are not available for a second home — the immediate deduction of mortgage points when purchasing and the capital gain exemption when selling. Both tax breaks require the home to be your “principal residence.” However, you can deduct the points on your second home’s mortgage over the loan’s term.

Written by Jon Neal | Posted in Deductibles • Property Tax

17 May 2018

Can You Deduct Business Travel When It’s Combined With Vacation?

At this time of year, a summer vacation is on many people’s minds. If you travel for business, combining a business trip with a vacation to offset some of the cost with a tax deduction can sound appealing. But tread carefully, or you might not be eligible for the deduction you’re expecting.

General Rules

Business travel expenses are potentially deductible if the travel is within the United States and the expenses are “ordinary and necessary” and directly related to the business. (Foreign travel expenses may also be deductible, but stricter rules apply than are discussed here.)

Written by William Rogers | Posted in Business • Deductibles • Tax Deductions

03 Apr 2018

Deducting Entertainment And Meal Expenses After 2017 Tax Reform Act

The Tax Cuts and Jobs Act enacted by Congress last year made major changes to the longstanding deductions for business-related entertainment and meal expenses. Starting in 2018, most business-related entertainment expenses are not deductible. However, the deductibility of certain meals is unclear.

Continue to find out what entertainment expenses are allowable tax deductions moving forward.

Entertainment Read More

Written by Advertorial | Posted in 2017 Tax Act • Tax Cuts Jobs Act

14 Nov 2017

Top 3 Tips For Handling Self-Employed Taxes

For self-employed individuals, there are a lot more steps involved when it comes to taxes than for most people. Here are some tips to help you keep as much of your hard-earned money as you can.

Written by Advertorial | Posted in Self Employment Tax • Tax Tips

25 Oct 2017

Can You Deduct Gasoline and Mileage On Your Taxes?

If you use a personal vehicle for business reasons, you can take many deductions for your car. This potentially includes the cost of gasoline. But, can you deduct gasoline and mileage on your taxes? Here’s what you should know:

Written by Advertorial | Posted in MILEIQ