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Tag Archive for Tax Planning

Tax Planning Under The Tax Cuts And Jobs Act For Pass-Through Entities

John Dundon, Pass-Throughs And Tax Cuts And Jobs Act

Now that the Tax Cuts and Jobs Act (TCJA) is in full swing, many of you have been clamoring for tax planning strategies. This post addresses some essential aspects of the TCJA and suggests some strategic implications to be used for planning purposes.

One of the most significant changes coming out of the TCJA are the new tax rates:

  • The individual tax rate is reduced to a maximum 37%.
  • Tax rate for a pass-through entities can be reduced by 20%.
  • The corporate tax rate is reduced from 35% to as low as 21%.

As a result of these new tax rates there is a growing debate over whether a business should be organized as a pass-through entity or a full blown ‘C’ corporation.

Families with multiple businesses in various life cycle stages are compelled to think very carefully about tax implications associated with their ‘portfolio’ of business entities.
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Tax Planning Is More Than Just Tax Filing

Haik Chilingharyan, Tax Planning

Tax planning involves a wide range of strategic decisions and implementations which affect your overall estate plan. In fact, there is arguably no other area of law that is more complex and that contains as many guidelines as the U.S. tax law. In addition, there are also State and Local Tax laws (SALT). The impact of SALT has become even more significant ever since the passage of the Tax Cuts And Jobs Act, primarily because the legislation now limits the SALT deductions to only $10,000.

The understanding of such complicated set of rules is a fundamental key to tax planning. Proper tax planning is a proactive measure that one takes to arrange and rearrange their finances in order to limit his or her tax liability to the lowest amount allowed by law. The confusion often arises because people often make the mistake of thinking that by hiring somebody to file their taxes they are engaging in proactive tax planning. However, the filing of tax returns is usually a reactive activity, not a proactive one.

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The Key To A Legal And Successful Reduction In Your Tax Liability Is Planning

The key to a legal and successful reduction in your tax liability is planning. We don’t just comply with tax procedures but we also recommend proactive tax saving measures to maximize your income after tax deductions.

We take it upon ourselves to master the current tax laws, new tax rules and the complicated tax codes by frequently attending tax seminars. Read more

Tax Benefits And Credits: Planning And Saving For College

As a CPA, I am asked a lot of questions regarding tax benefits and credits for children. One of the more interesting questions I have heard is “Why do they take away benefits as the kids get older? They don’t cost less, they cost more – a lot more”. While I don’t really have a good answer, one thing I do explain is that there are different benefits and credits that apply to older children as it pertains to their college education.
 
One of the biggest decisions in a person’s life is what college to attend – or whether to attend at all. The decision and the subsequent attendance and performance will likely have more of an impact on their overall comfort and life style than any other event or decision in their lives.

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What Is The Best Age To Start Drawing Social Security?

Of the most common and most difficult questions clients ask me it when should they start their social security benefits. It is an important question in that social security represents a significant amount of money over the course of your retirement. The amount of money you have coming into your household each month will affect how you can spend your retirement years. It is a difficult question because one of the most important factors in the decision is unknown – how long you will be collecting it.
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Casualty And Theft Losses

It is not unknown for people to suffer a loss in the form of theft and casualty for their personal properties. If you are one of them, you can claim the same as itemized deduction for your tax returns. To do so, you need to fill up the Form 4684 to understand how much of yours loses you can report and then mention the same in the Schedule A of the Form 1040.

It is important to note that you can claim only for those losses that are not covered or reimbursed by any insurance company. Also, in order to qualify for the deductions, your loss should amount to more than 10% of your adjusted gross income. You cannot claim a deduction otherwise. Read more

Australian Tax- The HECS, HELP, and TLS Shirt Tail Effect

Many overseas destinations welcome young Australians to live and work. For the best and brightest of Australia’s young, the expat experience is a rite of passage.

However, the best and brightest young Australians often have a HELP debt or Trade Support Loan (TSL). A visit to the Australian Taxation website shows your HELP and TSL debts are a trailing shirt tail that forever ties you to your home until they’re paid off.

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Foreign Investors In United States Real Estate

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Canadian Tax FAQs – Proposed Canadian Tax Changes

What are the proposed tax changes to private corporations that the Canadian government made in July 2017 and what do these changes mean for my company?

On July 18, 2017, the Canadian government proposed tax changes in an effort to remove tax advantages that small business owners have and address aggressive tax planning strategies involving the use of private corporations. These proposed changes are open for discussion until October 2, 2017, before being formally submitted for legislation. Read more

Why There Is A Box Of Kleenex On My Desk!

David Southwell

A prospective client called a few weeks ago to discuss his tax situation. He sold his business in 2016 and was very unhappy with his income tax bill. He asked, “Can you lower my taxes? Did the return preparer calculate my taxes correctly?” After a brief review of his sales contract and the return prepared for him, the answer was clear. The return was prepared correctly. However, wise tax planning when he started his business about ten years ago, or even a few years back, would have saved him a very large sum of money when he sold his business.

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Prepare For The Tax Pendulum To Swing

John Dundon

One thing to be be thankful for this holiday season is that the tax ‘policies’ of President Elect Trump and our Republican friends in the 115th congress will keep tax accounts and bookkeepers gainfully employed well into the foreseeable future. In fact I am adding staff again, which ‘sounds’ great!

Is it good for the US though – from a wonky economic perspective – that tax practitioners are expected to be in high demand well into the foreseeable future? Perhaps, perhaps not.

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Webinar – Rainmaking For Tax Professionals – Build Your 2017 Marketing Plan

(3-Part Webinar Series – Have Your 2017 Marketing Plan Ready Before Christmas – 12/7, 12/14, and 12/21)

You are invited to join this webinar if you want to build out your entire marketing plan for 2017! Monika Miles will be leading this super smart webinar that will result in your having your 2017 Marketing Plan in place before Christmas.

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