2017 Year-End Tax-Planning Moves for Businesses

John (Rusty) Davis, CPA

Businesses should consider making expenditures that qualify for the business property expensing option. For tax years beginning in 2017, the expensing limit is $510,000 and the investment ceiling limit is $2,030,000. Expensing is generally available for most depreciable property (other than buildings), off-the-shelf computer software, air conditioning and heating units, and qualified real property-qualified leasehold improvement property, qualified restaurant property, and qualified retail improvement property. The generous dollar ceilings that apply this year mean that many small and medium sized businesses that make timely purchases will be able to currently deduct most if not all their outlays for machinery and…

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2017 Year-End Tax Planning Moves for Individuals

John (Rusty) Davis, CPA

Higher-income earners must be wary of the 3.8% surtax on certain unearned income. The surtax is 3.8% of the lesser of: (1) net investment income (NII), or (2) the excess of modified adjusted gross income (MAGI) over a threshold amount ($250,000 for joint filers or surviving spouses, $125,000 for a married individual filing a separate return, and $200,000 in any other case). As year-end nears, a taxpayer’s approach to minimizing or eliminating the 3.8% surtax will depend on his estimated MAGI and NII for the year. Some taxpayers should consider ways to minimize (e.g., through deferral) additional NII for the…

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2017 Year-End Estate Tax Planning Moves

John (Rusty) Davis, CPA

Make gifts sheltered by the annual gift tax exclusion before the end of the year and thereby save gift and estate taxes. The exclusion applies to gifts of up to $14,000 made in 2017 to each of an unlimited number of individuals. You can’t carry over unused exclusions from one year to the next. Such transfers may save family income taxes where income-earning property is given to family members in lower income tax brackets who are not subject to the kiddie tax. Gifts that use the annual gift tax exclusion. One of the benefits of using the gift tax annual…

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2016 Business Tax Planning: 10 Moves Before Closing Your Year!

John (Rusty) Davis, CPA

1. DOL New Overtime Rule: Understand It Fully! Effective 12/1/16, the annual salary threshold increases from $23,660 to $ 47,476 for “white collar” exemptions. Be sure to evaluate your employment policies thoroughly to comply. Details here: https://www.dol.gov/WHD/overtime/final2016/  2. Employer ACA Information Reporting:  Confirm Responsibility! The IRS has announced extended due dates and penalty relief for 2016 information reporting mandated by the Affordable Care Act (ACA). The ACA requires detailed information reporting for insurers, self-insured employers, certain other providers of minimum essential coverage under IRC Sec. 6055, as well as employers with 50 or more full-time employees. Employers will now have…

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