Tax

The passive loss rules prevent deducting rental real estate losses with two exceptions. Exceptions: 1. The Real Estate Professional Exception. Taxpayers who spend more than 50% of their working hours and over 750 hours each year materially participating in real estate as a developer, broker, landlord, etc. are allowed to take their real estate losses.…

In the old days, you used this strategy with your college student. Today, this strategy does not work with that student because the kiddie tax now applies to students up to age 24. But this strategy is a good one, so ask yourself this question: do I give money to my parents or other loved…

What is Better: Rolling Over Your Real Estate Sale Proceeds with a 1031 Exchange into another Property, or Investing Your Gains into an Opportunity Fund? Have you sold, or are you planning on selling commercial or rental property? To avoid immediately paying capital gains tax on your profit, you have two choices: 1) Deferring the…

The IRS giveth, the IRS taketh away Few taxpayers understand that if they received an Employee Retention Credit, they must reduce their wage related expenses by the amount of the credit. To make matters worse, the IRS has decreed that taxpayers must reduce their wage expenses in the year the wages were incurred that generated…

Marginal tax brackets for 2023 tax year There are many benefits to S corporation status for your small business. However, fringe benefits are severely reduced for owners of S corporations. However, there is one way you can deduct your health insurance premiums. If you will follow the below instructions exactly as stated, you can get…

Marginal tax brackets for 2023 tax year Marginal rate Individual income Married couples filing jointly 10% $11,000 or less $22,000 or less 12% $11,000 to $44,725 $22,001 to $89,450 22% $44,726 to $95,375 $89,451 to $190,750 24% $95,376 to $182,100 190,751 to $364,200 32% $182,101 to $231,250 $364,201 to $462,500 35% $231,251 to $578,125 $462,501…

The Inflation Reduction Act Energy Credit Provisions (Give Credit where Credit is Due) Credit for alternative energy system based on renewable energy source For example, credit for using solar panels as an energy source for your home got extended to 2034. The improved credit is 30% (26% for 2033 and 22% for 2034) of the…

Focus on inflation-hedged assets. Precious metals, I-Bonds and real estate are all considered inflation hedges. Crypto is a speculation not an investment as can be seen by both its recent downfall and the increasing number of crypto thefts. 1. Precious Metals: a. Stock in mining companies i. PRO – familiar and safe market ii. CON…

Once your tax lien is fully paid off, you must still ask the IRS to withdraw the lien. The IRS will withdraw the lien immediately if the lien is paid in full and you have been tax compliant for the past three years. The cool thing about the removal of the lien is it is…

Sweet Deal Businesses can deduct the full cost of new and used qualifying assets with lives of 20 years or less that they buy and place in service during the year. A used asset can not have been depreciated by the previous owner. So, for all practical purposes, the asset purchased cannot be real estate,…