Tax Warrior Chronicles

Rogue One: A Single Tax on Foundation Investment Income Story

Posted on Wed, Jan 22, 2020

By: Keisha Price, CPA, MST

 

A Long Time Ago in a Tax System Far, Far, Away…Private Foundations were subject to a 2% tax on net investment income generated from the Foundation’s charitable assets. This 2% tax could be reduced to 1% if the foundation’s current year charitable distributions exceeded its average charitable distributions over the prior five years…until now!

 

Makes Sense Right?

Well yes! It makes sense for a foundation with a clear charitable purpose, effective directorship, and meaningful assets to give more for the greater good of the galaxy each year and that deserves a tax break.

 

Constructing the Death Star

Let’s say the good and benevolent founder of the foundation

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Inflation Adjustments Increase Tax Deductions for 2020

Posted on Thu, Nov 14, 2019

By: Eric R. Elmore

 

Often, “inflation’ is a bad word for economists and financial experts to utter.  But last week, the IRS announced its annual inflation adjustments for 2020 and many tax deductions have increased as a result. In today’s post, we’ll get you up to speed on the increased deductions available in 2020. Let’s get at it!

 

Revenue Procedure 2019-44 explains these annual adjustments. Some tax law changes in the Revenue Procedure were added by the Taxpayer First Act of 2019, which, among other things, increased the failure to file penalty to $330 for returns due after the end of 2019. The new penalty will be adjusted for inflation beginning with tax year 2021.

 

Many amounts,

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Deductions for Qualified Transportation Benefits - Another Casualty of TCJA

Posted on Fri, Sep 06, 2019

By: Robert N. Polans, CPA, MT, PFS, and Stefanie Ostrich, CPA

 

The Tax Cuts and Jobs Act of 2017 (TCJA) contained hundreds of changes to our tax law including Qualified Business Income Deductions, limits on business interest expense, limits on excess business losses, and major changes to the U.S. taxation of profits earned overseas.  While much of the noise about the new tax law revolved around these items and others, less noise surrounded the part of the law which eliminates the deduction for Qualified Transportation Benefits.

 

The Internal Revenue Code (IRC) allows employers to offer certain non-taxable Qualified Transportation Fringe (QTF) benefits to their employees.  These can

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