IRS Issues Additional Details on the New Paid Family Leave Tax Credit

More and more clarifications are rolling out from the Tax Cuts & Jobs Act. 

A recent update from the IRS issued guidance on the Paid Family and Medical Leave Tax Credit. Businesses that provide benefits such as paid family or medical leave to low income earning employees may be eligible for a credit of up to 25 percent of wages paid for each hour of family or medical leave taken.

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Are you a Real Estate Professional or Passive Investor?

 Determining whether you are a real estate professional or a passive investor can have significant tax implications. 

Real estate investment can often lead to significant tax savings due to depreciation and other deductions that are immediately incurred.  Individuals classified as real estate professionals can use losses from real estate activities to offset sources of income such as wages, active business income, or portfolio income.  However, these losses are treated as passive for individuals who cannot achieve real estate professional status.  These passive losses would generally only be able to be used to offset other passive income.  They could also be carried forward to future years if they are not able to be used currently.

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How to Maximize Tax Benefits from Buying Property

Many businesses have long-term assets on their balance sheets.  For an asset to be considered long-term it needs to be held on a company’s balance sheet for more than a year and cannot be intended for sale.  Examples of long-term assets include physical assets such as property, plant and equipment (PP&E) – machines, buildings, office equipment, vehicles, fixtures, land, computers, etc.  These are all tangible assets.  However, there are some intangible assets that are considered long-term such as goodwill, patents, research and development, and copyrights.

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Immediate Tax Benefits for Business Property - Section 179 Provides Generous Tax Break

There is a unique tax break for business entities of all shapes and sizes contained in Section 179 of the Internal Revenue Code. Under this section, a business can elect to “expense,” or currently deduct, the cost of qualified property placed in service during the year, up to a maximum level. It is near-instant tax gratification.

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Five Year-end Ideas for Your Business

Remember that year-end planning is not just for individuals.  In fact, your business operation may benefit from tax moves in 2016 in the wake of several key extensions in the Protecting Americans from Tax Hikes (PATH) Act of 2015. Here are five ideas for small-business owners to consider.

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