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Home Equity Tax Deductions

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Home Equity Tax Deductions

The Tax Cuts and Jobs Act of 2017 affected home equity tax deductions as of 2018.  Under prior law, you could deduct interest on up to $100,000 of home equity debt, no matter how you used the money.  The old rule is scheduled to return in 2026.  The bad news is, you now can’t deduct interest on home equity loans or home equity lines of credit if you use the money for college bills, medical expenses, paying down credit card debt, and so on.  For home loan interest to be tax deductible, the taxpayer that secures the loan must use the money to buy, build, or substantially improve his or her home.

Small Business: Coping With Summer Vacations

During the summer, it may be true that “the living is easy,” as the old song goes.  However, the midyear season is often not so easy at small businesses because many employees are taking vacations.  Total work hours often shrink and so may company productivity.

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Tax Calendar

June 15th – If not withholding, second installment of estimated 2018 tax due.

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New Tax Law Changes Divorce Tactics

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New Tax Law Changes Divorce Tactics

Financial negotiations in a divorce often involve alimony.  The new tax law changes divorce tactics regarding alimony, but grandfather existing agreements. In addition, old rules will remain in effect for divorce and separation agreements executed during 2018 but next year, the rules will change and the roles will be reversed.

Small Business: No Deduction for Business Entertaining

The TCJA of 2017 lowered corporate tax rates from a graduated schedule that reached 35% to a 21% flat rate.  However, the bad news is many business expenses are no longer tax deductible. That list includes all outlays which might be considered entertainment or recreation.

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Tax Calendar

No “Individual” Deadline This Month – Click above for Corporate Due Dates

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Tax Cut and Jobs Act of 2017

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Tax Cut and Jobs Act of 2017 – Special Report

A lot may be on your mind since the announcement of the Tax Cut and Jobs Act of 2017 (TCJA) and how it will affect you.  This issue provides readers with great information on being patient, knowing your true tax rate, retirement contributions, Roth conversions, medical deductions, and so much more.  Take a look inside to start easing some of your worries and planning for the future!

Small Business: New Deduction for Pass-Through Entities

As a business owner, you could be in the spotlight if allegations of improper behavior arise, especially if they are brought by one or more employees.

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Tax Calendar

April 17th – Tax Due Day! File your return!

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Weighing Bond Fund Risks

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Weighing Bond Fund Risks

This issue explores weighing bond fund risks as part of a healthy investment plan.  Most portfolio allocations call for a mix of stocks (equities) and bonds (fixed income).  As we’ve seen in recent years, stocks can be extremely risky but have recovered from periodic setbacks. Bonds offer low yields in today’s environment. Therefore, one main reason for holding bonds is to dampen overall portfolio swings and holding down losses when stocks sag. This may help keep investors in the stock market and allow them to benefit in the next cyclical move to the upside.

Small Business: Addressing Harassment Issues

As a business owner, you could be in the spotlight if allegations of improper behavior arise, especially if they are brought by one or more employees.

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Tax Calendar

No “Individual” Deadline This Month – Click above for Corporate Due Dates

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Understanding Annuities

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Understanding Annuities

Find out what you need to know for understanding annuities.  Americans hold billions of dollars in annuities; however, they are widely misunderstood. When used properly, an annuity can serve valuable personal financial planning purposes. On the other hand, some financial advisers widely criticized, and even scorn, certain types of annuities.  Learn from some examples about how annuities could be a part of your strategy for retirement.

Small Business: Deducting Employee Expenses and Insurance

Find out what deductions are allowed, what’s not and what forms you need to complete.  Also, you have a small business and your budget is tight, you still need to make sure key employees have the proper insurance coverage.

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Tax Calendar

February 15th – File a new W-4 with your employer.

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Asset Management Fees

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Asset Management Fees

With title shifts happening at investment firms, the Asset Management Fees structure is changing to meet the new titles.  While the titles are not important, the method to compensate these individuals is crucial and something you should watch for so you don’t lose out.

Roth IRA Reversal

Partial conversions will help avoid long term Required Minimum Distributions but could trigger high tax implications. Read to learn more about planning for this.

Small Business: Year End Thank You Gifts

Thank your employees before the year is over but think about what to give them and how it affects their income.

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Ginnie Mae Funds

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Ginnie Mae Funds for Your Retirement

Everyone says real estate investing is a great way to build wealth.  Did you know Ginnie Mae funds, or mortgage bonds, are the only mortgage securities with full federal backing?  Learn more about how the Government National Mortgage Association (GNMA) agency can help add security to your retirement funds.

Tax Credits Beat Tax Deductions

Tax Credits are a dollar-for-dollar reduction of the tax you owe whereas deductions are only a partial relief by reducing your income.  We take a look at some of the most common credits.

Small Business: R&D Tax Credits

R&D Costs may not be immediately deductible, so we provide some examples to think about when planning your tax/expense year.

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Tax Calendar

September 15th – Third installment of estimated tax

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Calculating Retirement Needs

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Calculating Retirement Needs

Do you know “Your Number” – When calculating retirement needs, this is the amount of total savings and investment required so you can afford to stop working.  It might seem as well the math would be difficult but it’s really not as daunting as one may think.  The other point to take note is:  The calculations for this are not a one and done event; you should periodically review this to see if you are on track or if adjustments need to be made.  One calculator you can start with is one the Social Security Administration’s website.

Taxable vs. Tax-Deferred

In last month’s newsletter we talked about 401(k)’s and Roth IRA’s as the third best investment you can make.  This month we look at what the tax implications are with such instruments and strategies.

Small Business: Do Well while Doing Good

The US Small Business Administration reports that 3 out of every 4 small business contribute an average of 6% of their earning to a charity.  While exploring examples, you’ll find out why people do it, how it’s potentially helped their business and what tax benefits you may get because of donating as a small business.

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Tax Calendar

July 17th – June deposit of Social Security, Medicare, withheld income tax and non-payroll withholding’s

July 31st – File form 941 for 2017 Q2