Can Your Accountant/Tax Attorney Read Between the Lines to Maximize Your Tax Savings?
One aspect that separates The Center for Financial, Legal & Tax Planning, Inc., from so many others is our ability to interpret the law. The Center is equipped with a staff of dual lawyers and CPA’s with fifty plus years of experience with the ability to unpack the complications of tax legislation in a manner beyond what a general CPA or tax attorney may provide. You may ask, why does any of this matter? Well, it matters because our tax and accounting practices are changing every day.
More specifically, the Tax Cuts and Jobs Act (TCJA) signed into law December 22, 2017, was the largest tax overhaul since the 1980’s. One major aspect of the TCJA is an allowance for pass-through entities to claim a 20% below-the-line deduction for the owner’s qualified business income. However, the 20% deduction is subject to limitations, limitations that are currently being interpreted as to their application. The TCJA has labeled a “specified service trade or business involving the performance of services in the fields of health, law, consulting, athletics, financial services, and brokerage services” as services who do not qualify for the 20% deduction. Thus, if you’re business falls within one of these categories, your CPA or tax attorney may have talked to you about converting to a C corporation. However, by doing so, your business may be missing out on substantial deductions throughout the taxable year.
If you think or have been told that your pass-through entity does not qualify for the 20% below-the-line deduction for the owner’s qualified business income, contact The Center for Financial, Legal & Tax Planning, Inc., for a specialized opinion. The Center will provide you the insight necessary for the most profitable path forward.