Small Business Owners, Self-Employed Should Plan Now for New Changes

The following article was published by the IRS.

partnership-526413_1280Before the end of the year, small business owners should become familiar with how the new tax law changes may affect them.

The Tax Cuts and Jobs Act, passed in December 2017, made tax law changes that will affect virtually every business and individual in 2018 and the years ahead. Among other things, the new law may change their tax rates and impact the quarterly estimated tax payments they are required to make during the year.

For many pass-through businesses, the law changes created a new 20-percent qualified business income deduction. Other deductions and credits have been changed as well, including revised depreciation methods and expanded options for expensing business property. There are also new rules for like-kind exchanges and fringe benefits. In addition, small business employers who provide paid family and medical leave to their employees during tax years 2018 and 2019 may qualify for a new business credit. Business owners can refer to the Tax Reform Provisions that Affect Businesses page for updates and resources on these topics and other business-related changes. Continue reading

Posted in Corporate Taxes, IRS, Planning Strategies, Self-Employed, Tax Credits, Tax Deductions, Tax Law Changes, Tax Tips, Taxes, Year End | Tagged , , , , , , | Leave a comment

Ways to reduce your tax burden before year-end

The new tax law has added some wrinkles to how many Americans deal with their tax returns. In the past, it was common to try to maximize deductions during the year and then itemize on your return. However, with the increase in the standard deduction for individuals and families this year, reducing taxable income is actually a better move for a lot more families.

According to Turbo Tax, almost 90% of tax filers will claim the standard deduction this year. This is a major shift from the norm. In past years, only about 70% of filers claimed this deduction. Continue reading

Posted in FSA, Health Care, HSA, IRA, IRS, Personal Finance, Planning Strategies, Tax Credits, Tax Law Changes, Tax Tips | Tagged , , , , , , , , , , , , , , , , , , , | Leave a comment

2018 Employer Reimbursements for Employees’ 2017 Moves are Generally Tax-Free

The following article was published by the IRS.

truck-2677373_1280Employer payments or reimbursements in 2018 for employees’ moving expenses incurred prior to 2018 are excluded from the employee’s wages for income and employment tax purposes.

The 2017 Tax Cuts and Jobs Act (TCJA) suspended the exclusion from income for moving expenses reimbursed or paid by an employer for most employees starting in 2018, making these amounts taxable, except for amounts for active-duty members of the U.S. Armed Forces whose moves relate to a military-ordered permanent change of station. Continue reading

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Simple Steps to Avoid Rip-offs

Now that holiday shopping season has officially begun, it’s important to be on the lookout for scams. We are going to take a brief look at some simple rules of fraud prevention to help this process along:

  1. Haste Makes Waste – Speed kills…your savings! Don’t ever let yourself be pressured into making a snap decision.
  2. Seek and You Shall Find – Before buying anything or dealing with anyone, put it in a search engine, along with words like “review”. Also, you can search for words such as “current scams” and “fraud alerts” as well. Finally, check with the BBB online.
  3. You Can’t Get Something for Nothing – If you feel you are getting something for nothing, you are likely the product and not the customer. As we recently found out with Facebook, free access to things is often at the expense of your privacy and information.
  4. Use Tax Dollar-Paid Protection – You’ve already paid your taxes; put them to good use by using organizations such as the FTC and the CFPB. Their websites are extremely informative and helpful.
  5. Say No To Robocalls, Unsolicited Emails – In most cases robocalls are illegal, and any email without an opt-out is illegal as well. Why would you ever deal with someone who is breaking the law to contact you?

Bottom line, be aware as a consumer. Most of these scams can be spotted with a trained eye and with a dose of common sense.

Posted in Data Security, Fraud, Holiday Tips, Identity Theft, IRS, Personal Finance, Planning Strategies | Tagged , , , , , , , , , , , , , , , , ,

Plan Now to Use Health Flexible Spending Arrangements in 2019

The following article was published by the IRS.

woman-3187087_1280The Internal Revenue Service is reminding eligible employees that now is the time to begin planning to take full advantage of their employer’s health flexible spending arrangement (FSA) during 2019.

FSAs provide employees a way to use tax-free dollars to pay medical expenses not covered by other health plans. Because eligible employees need to decide how much to contribute through payroll deductions before the plan year begins, many employers are offering their employees the option to sign up for an FSA this fall for participation that begins in 2019.

Interested employees wishing to contribute during the new year must make this choice again for 2019, even if they contributed in 2018. Self-employed individuals are not eligible. Continue reading

Posted in FSA, Health Care, IRS, Personal Finance, Personal Taxes, Planning Strategies, Tax Tips, Taxes, Year End | Tagged , , , ,

How to budget for holiday shopping

It’s really amazing how so many people handle their finances with discipline for most of the year, only to let things completely fall apart when the holidays arrive. Part of the reason is that we spend a lot more time in stores during these months.

During the holidays, shopping becomes almost recreational, where you buy things on sale that you wouldn’t even consider any other time of year. Shopping may start out as buying for others, but the rush of activity may soon turn the focus on yourself if you are not careful.

Spending on yourself isn’t a bad thing, but there is a problem when it comes to buying things you didn’t plan for, whether it be for yourself or for others. Make sure you first find out how much you are able to spend on holiday shopping, then make a list of what you want to buy for yourself and your loved ones. As you buy for someone on your list, subtract that amount from your budget and keep track of every dollar spent. Continue reading

Posted in Personal Finance, Planning Strategies | Tagged , , , , , , , , , , , , , , , , , , , ,

Combat-Zone Contract Workers Qualify for Foreign Earned Income Exclusion

The following article was published by the IRS.

tank-203496_1280Certain U.S. citizens or resident aliens, specifically contractors or employees of contractors supporting the U.S. Armed Forces in designated combat zones, may now qualify for the foreign earned income exclusion.

The Bipartisan Budget Act of 2018, enacted in February, changed the tax home requirement for eligible taxpayers, enabling them to claim the foreign earned income exclusion even if their “abode” is in the United States. The new law applies for tax year 2018 and subsequent years.

This means that these taxpayers, if eligible, will be able to claim the foreign earned income exclusion on their income tax return for 2018 when they file. Under the exclusion, taxpayers can choose to exclude their foreign earned income from gross income, up to a certain dollar amount. For tax year 2018, that dollar amount limit is $103,900. Continue reading

Posted in IRS, Military, Personal Taxes, Tax Law Changes, Tax Tips, Taxes | Tagged , , , , , , , ,