Tax Warrior Chronicles

Seize the Day: There’s Never Been a Better Time to Consider Cost Segregation

Posted on Wed, Jun 17, 2020

Everyone wants to maximize tax savings on their commercial real estate, and while Cost Segregation Studies have long been a solid IRS-approved strategy, these days they are more popular than ever, especially with some of the changes under the CARES Act,Today’s guest blogger, Terri S. Johnson of Capstan Tax Strategies, is here to explain why “cost seg” studies are all the rage, and to walk us through the top-three prime cost segregation scenarios.    

 

Simply put, Cost Segregation is an engineering-based analysis in which specific property components are identified and reallocated into modified cost recovery system (MACRS) class lives.  Treating the components as personal property or land

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Estate Planning During the COVID-19 Pandemic

Posted on Thu, Jun 04, 2020

Although it may seem counterintuitive, the current economic conditions brought on by the COVID-19 global pandemic, including down markets and reduced interest rates, provide estate planning opportunities many individuals may want to consider as part of their overall estate plan.

 

Last September we discussed the advantages of certain estate planning strategies in low-interest rate environments. Fast forward to today, the Applicable Federal Rates ("AFR") have fallen again for June (between .18% to 1.31% depending on the loan term), so such strategies may be even more advantageous in the current environment.

 

Besides the current low-interest rate environment, the Tax Cuts and Jobs Act

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Opportunities to Increase Cash Flow from 2018–2020 Business Losses

Posted on Wed, Apr 22, 2020

The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) provides relief to taxpayers with net operating losses (“NOLs”) and excess business losses (“EBLs”) arising in taxable years 2018 to 2020.  The IRS recently issued guidance related to the new NOLs rules under the CARES Act, which are favorable to taxpayers seeking such relief.

 

Background – Net Operating Losses

Generally, NOLs for businesses and individuals can offset income in future or prior tax years when the company or individuals have income.  The 2017 Tax Cuts and Jobs Act (“TCJA”) changed the NOL carryback and carryforward rules by disallowing all carrybacks NOLs arising in taxable years beginning after December

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CARES Act Offers Relief for TCJA Interest Expense Limitations

Posted on Thu, Apr 09, 2020

As part of the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), Congress provided temporary relief for individuals and businesses by adjusting interest expense limitations under Internal Revenue Code 163(j).  Today, we summarize those changes.

 

Background - The Tax Cuts and Jobs Act

The Tax Cuts and Jobs Act (“TCJA”) added several complicated tax provisions in December 2017.  Arguably one of the most difficult areas for taxpayers to navigate was IRC §163(j).

Because of its complexity, we urge you to read about the details of 163(j) in our previous blogs, “Business Interest Limitation Under TCJA Part I, Part II, and Part III.

 

What Has Changed - CARES Act

For taxable years

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Depreciation Changes Under CARES Act - Qualified Improvement Property

Posted on Tue, Mar 31, 2020

Taxpayers and practitioners nationwide have been waiting over 2 years for a technical correction to fix an error in the 2017 Tax Cuts & Jobs Act (TCJA) related to depreciation of Qualified Improvement Property (QIP).  The error was finally fixed in the recently enacted Coronavirus Aid, Relief and Economic Security Act (CARES Act), and the change has created significant tax-reduction opportunities for some taxpayers.

 

Background

Prior to the TCJA, non-residential improvements were classified as either Qualified Leasehold Improvements, Qualified Restaurant Property, or Qualified Retail Improvement Property.  The TCJA replaced these three types with one “Qualified Improvement Property”

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Partnerships – What’s New for 2019?

Posted on Mon, Feb 24, 2020

The Tax Cuts and Jobs Act (TCJA) threw tax practitioners nationwide for a loop last year, especially relating to partnership taxation.  While we now have one TCJA tax season under our belts, partnership taxation continues to be complex and there are additional changes for 2019 of which to be aware.  

 

One of the biggest headaches we’ve encountered thus far for 2019 returns relates to partnerships with partners that are disregarded entities.  For 2019, the IRS now wants the OWNER of that disregarded entity to be listed as the partner (using the owner’s address and EIN/SSN) on the K-1.  The disregarded entity and its EIN will now be listed on a new line, Item H, underneath the owner’s

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7 Tax-Saving Stocking Stuffers for Year-End 2019

Posted on Tue, Dec 10, 2019

By: Rosie Flite

 

As 2019 winds down, the upcoming Holidays are at the forefront of everyone’s mind. Between planning gifts, meals, and travel arrangements, many forget the importance of year-end tax planning.  With that in mind, we offer seven (7) strategies that may save everyone money when April 15th comes around in 2020.

 

  1. Avoiding Estimated Tax Underpayment Penalties

To avoid the IRS charging penalties for underpaying estimated taxes, individuals must meet at least one of these three criteria:

  • a person's total tax due after withholdings is less than $1,000, or
  • they have paid in at least 90% of their taxes for the current year, or
  • the individual has paid in at least 100% of the
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Top 5 Blogs of the 2019 Tax Season

Posted on Mon, Oct 28, 2019

By: Eric R. Elmore

 

The 2019 tax filing season has finally concluded, and not a moment too soon.  Americans filed the first full year of income under the Tax Cuts and Jobs Act of 2017 (“TCJA”), the most sweeping revamp of the tax code in more than 30 years. Today’s post is a snapshot of the blogs that were most read by our subscribers over the course of the filing season. It’s a good indication of what was on the minds of our readers while filing their returns. Did any of these play out in your tax planning?

 

Most outside the world of accounting and finance don’t know there are two “tax seasons” per year. The spring deadlines are well known, these deadlines get all the press.  The fall

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TCJA: What it Said vs. What it Did

Posted on Mon, Jul 22, 2019

By: Joe Brunell, CPA

 

The Tax Cuts and Jobs Act of 2017 (TCJA) is the most significant tax code overhaul since the Tax Reform Act of 1986.  The TCJA had four goals; tax relief for middle-income families, simplification for individuals, economic growth and repatriation of oversea income.   It cut individual income tax rates, doubled the standard deduction, eliminated personal exemptions and capped state and local itemized deductions.  While on the surface tax compliance now sounds simpler, as you will see, this isn’t the case.

 

Individuals

First and foremost, the new 1040 tax form is now postcard sized.  However, smaller is not always simpler; the new tax forms have become more

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Introducing  - Tax Warrior Vlog

Posted on Wed, Jun 12, 2019

Chris Catarino shares insights on what we learned after the first full year of the Tax Cuts & Jobs Act.

 

CJC - TCJA One Year Later

 

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