Author Archives: Site Administrator
Why you need to know the value of your assets
With the gift and estate tax exemptions currently at $5.34 million, you might think that estate valuations are less important. But even if you believe that your estate’s value is under the exemption amount, it’s still important to know the value of your assets. First, your estate might be worth more than you think…. Read More »
Who’s subject to the 50% limit on meal and entertainment deductions?
In general, when meal and entertainment expenses are incurred in the context of an employer-employee or customer–independent contractor relationship, one party will be subject to a 50% limitation on the deduction. But which party? Last year, the IRS finalized regulations that address this question. In the employer-employee setting: If the employer reimburses the employee… Read More »
Softening the blow of higher taxes on trust income
This year, trusts are subject to the 39.6% ordinary-income rate and the 20% capital gains rate to the extent their taxable income exceeds $12,150. And the 3.8% net investment income tax applies to undistributed net investment income to the extent that a trust’s adjusted gross income exceeds $12,150. Three strategies can help you soften… Read More »
Making the most of your business’s NOL
If during 2013 income tax return filing you found that your business had a net operating loss (NOL) for the year, the news isn’t all bad. While no one enjoys being unprofitable, an NOL does have an upside: tax benefits. In a nutshell, an NOL occurs when a company’s deductible expenses exceed its income… Read More »
Your 2013 return may be your last chance for two depreciation-related breaks
If you purchased qualifying assets by Dec. 31, 2013, you may be able to take advantage of these depreciation-related breaks on your 2013 tax return: Bonus depreciation. This additional first-year depreciation allowance is, generally, 50%. Among the assets that qualify are new tangible property with a recovery period of 20 years or less and… Read More »
Home office deduction 101
If your use of a home office is for your employer’s benefit or because you’re self employed, you may be able to deduct a portion of your mortgage interest, property taxes, insurance, utilities and certain other expenses, as well as the depreciation allocable to the office space. Or you may be able to take… Read More »
Are you meeting the ACA’s additional Medicare tax withholding requirements?
Under the Affordable Care Act (ACA), beginning in 2013, taxpayers with FICA wages over $200,000 per year ($250,000 for joint filers and $125,000 for married filing separately) had to pay an additional 0.9% Medicare tax on the excess earnings. Unlike regular Medicare taxes, the additional Medicare tax doesn’t include a corresponding employer portion. But… Read More »
Is it time for an estate plan checkup?
Now that we’re in the new year, it’s time for an estate plan checkup. Why? First, various exclusion, exemption and deduction amounts are adjusted for inflation and can change from year to year, so it’s a good idea to see if they warrant any updates to your estate plan: Lifetime gift and estate tax… Read More »
Even with rising exemptions, 2013 annual exclusion gifts still a good idea
Recently, the IRS released the 2014 annually adjusted amount for the unified gift and estate tax exemption and the generation-skipping transfer (GST) tax exemption: $5.34 million (up from $5.25 million in 2013). But even with the rising exemptions, making annual exclusion gifts is still a good idea. The 2013 gift tax annual exclusion allows… Read More »
Will your investment income be subject to the new 3.8% NIIT?
Under the health care act, starting in 2013, taxpayers with modified adjusted gross income (MAGI) over $200,000 per year ($250,000 for joint filers and $125,000 for married filing separately) may owe a new Medicare contribution tax, also referred to as the “net investment income tax” (NIIT). The tax equals 3.8% of the lesser of… Read More »