Tag: tcja
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Play Your Tax Cards Right with Gambling Wins and Losses
If you gamble, be sure you understand the tax consequences. Both wins and losses can affect your income tax bill. And changes under the Tax Cuts and Jobs Act (TCJA) could also have an impact. Wins and taxable income You must report 100% of your gambling winnings as taxable income. The value of complimentary goodies…
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Choosing the Right Accounting Method for Tax Purposes
The Tax Cuts and Jobs Act (TCJA) liberalized the eligibility rules for using the cash method of accounting, making this method — which is simpler than the accrual method — available to more businesses. Now the IRS has provided procedures that a small business taxpayer can use to obtain automatic consent to change its method…
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Effects of the TCJA on Roth IRA Conversions
Converting a traditional IRA to a Roth IRA can provide tax-free growth and tax-free withdrawals in retirement. But what if you convert your traditional IRA — subject to income taxes on all earnings and deductible contributions — and then discover you would have been better off if you hadn’t converted it? Before the Tax Cuts…
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Do You Still Need to Worry About the AMT?
There was talk of repealing the individual alternative minimum tax (AMT) as part of last year’s tax reform legislation. A repeal wasn’t included in the final version of the Tax Cuts and Jobs Act (TCJA), but the TCJA will reduce the number of taxpayers subject to the AMT. Now is a good time to familiarize…
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Why the “Kiddie Tax” is More Dangerous than Ever Before
Once upon a time, some parents and grandparents would attempt to save tax by putting investments in the names of their young children or grandchildren in lower income tax brackets. To discourage such strategies, Congress created the “kiddie” tax back in 1986. Since then, this tax has gradually become more far-reaching. Now, under the Tax…
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Close-up on the New QBI Deduction’s Wage Limit
The Tax Cuts and Jobs Act (TCJA) provides a valuable new tax break to non-corporate owners of pass-through entities: a deduction for a portion of qualified business income (QBI). The deduction generally applies to income from sole proprietorships, partnerships, S corporations, and, typically, limited liability companies (LLCs). It can equal as much as 20% of…
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Do you know the ABCs of HSAs, FSAs, and HRAs?
Uncertainty persists about how the Affordable Care Act will impact health care costs. Leveraging all tax-advantaged ways to fund these expenses – including HSAs, FSAs, and HRAs – is critical. Here’s how to make sense of this alphabet soup of health care accounts. HSAs If you’re covered by a qualified high-deductible health plan (HDHP), you…
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The Tax Impact of the TCJA on Estate Planning
The massive changes the Tax Cuts and Jobs Act (TCJA) made to income taxes have garnered the most attention. But the new law also made major changes to gift and estate taxes. While the TCJA didn’t repeal these taxes, it did significantly reduce the number of taxpayers who’ll be subject to them, at least for…
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The TCJA Changes Some Rules for Deducting Pass-through Business Losses
Tax losses generated buy businesses are not uncommon, but the losses that can be deducted are limited by tax law in some situations. The Tax Cuts and Jobs Act (TCJA) further restricts the amount of losses that sole proprietors, partners, S corporation shareholders, and, typically, limited liability company (LLC) members can currently deduct — beginning…
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Be Aware of Tax Consequences Before Selling Your Home
In many parts of the country, summer is peak season for selling a home. If you’re planning to put your home on the market soon, you’re probably thinking about things like how quickly it will sell and how much you’ll get for it. But don’t neglect to consider the tax consequences. Home sale gain exclusion…