How the average person files their tax return will be different in 2019 as part of the Tax Cuts and Jobs Act, which moved toward a simplified method. However, with any change as large as this there are bound to be some hiccups and issues along the way. First of all the TCJA aimed to lower the tax rates for most taxpayers (and it did), but in order to do so it doubled the standard deduction. The standard deduction helps most people, but this can hurt the minority of individuals or families who relied on the itemized deductions that are now almost entirely gone. For each taxpayer, it will be important to know where you fall with the new deductions and plan accordingly. Furthermore, the IRS

The IRS has recently released proposed regulations regarding the passthrough entity deduction. 199A has been talked about frequently since its implementation and now the IRS has responded. We’ll take a short look at some of the proposed regulations that will likely be decided upon in mid-2019. Proposed regulation 1.199A has six main parts that offer varying definitions and clarifications for accountants and tax attorneys. First, they provide operational rules, which helps determine the deduction for taxpayers that fall below the threshold set by section 199A. Next, in 1.199A-2 contains the rules for determining W-2 wages and UBIA of qualified property, both of which are part of the calcu

The optional standard mileage rates for business use of a vehicle will raise from 2018 to 2019. Previously, the rate was 54.5 cents per mile, but has now been raised to 58 cents per mile. Taxpayers can use the optional standard mileage rates for calculation of the deductible costs of the operation of a business automobile. Readers may note that we have previously written about the discontinuation of miscellaneous itemized deductions under the TCJA. The current notice put out by the IRS further clarifies that this rate does not apply for these past deductions during the 2018-2025 period. There are always exceptions to the rule as there are here. U.S. Armed Forces, state or local governme

Every year when people file their taxes, some might be tempted to misappropriate some expenses here or there to change their tax brackets or deductions. Here is a warning, do not do that. Even filing your tax return incorrectly on accident can be hard to correct with the IRS, so purposefully changing items to make your refund higher is definitely not a good idea. Here are some ideas people think they might get away with and never do. A common area that people on their tax refunds is deducting personal purchases as a business expense. For definition, an eligible business expense must be incurred in a current tax year, not reimbursed by an employer and be both ordinary and necessary. File

The midterm elections are over, but the house remains active in trying to revise last year’s massive tax overhaul. Kevin Brady, Chairman of the House Ways and Means Committee, released an end-of-year tax package that he hopes to get passed before the new congressmen take their seats. The new revisions include tax relief for victims of recent natural disasters, delays or repeals several Obamacare-related taxes, and ends any extensions of many expired breaks that were previously included. The bill also includes provisions Brady proposed earlier in the year, pushing for reform of the IRS, boost in retirement savings, and technical fixes to the TCJA. Brady previously had pushed an end-of-year

It’s the end of the year and people are beginning to think about how much taxes they will owe (or be refunded). Over the course of the year some people may have decided to sell their stocks whether it be for a gain or loss. Their question is probably, how much money will I owe on the gains or losses? The first question is if you owned the stocks in a Roth IRA? If you did, and you’ve had the account for a minimum of five years then you will owe no taxes at all. It will be different if you use a traditional IRA or another tax-differed retirement account. In these instances so long as the money remains in your account you won’t owe any taxes, once it is removed you will be taxed at your or