It’s the end of January which means it is almost tax season. At this point, tax documents have probably started showing up in your mailbox. While it may seem like there is plenty of time, the sooner and more organized you can make your documents, the smoother the process will be.
This year on January 1, a new law put the Workforce Education Surcharge into effect. This means that a new three-tiered surcharge applies to the amount of tax payable under the Service and Other Activities B&O tax classification by businesses “primarily engaged” in one or more specific activities.
On May 23, 2019 the House voted 417-3 to pass legislation intended to help individuals save for retirement, encourage them to participate in retirement plans, and make it easier for small businesses to offer tax-qualified plans to their employees. The Setting Every Community Up for Retirement Enhancement Act (SECURE Act) passed the Senate December 19th and was signed by President Trump on Dec. 20. It is the largest piece of legislation affecting retirement plan rules since the Pension Protection Act of 2006. Many of the act’s provisions become effective on Jan. 1, 2020 and all retirement plans must adopt the law by 2022. As with any new law, not all of the details are clear yet, but below is a high-level summary of what you should know:
The Tax Cuts and Jobs Act of 2017 brought about many tax changes, one of which is what and how much of your meals and entertainment expenses are deductible. At a high level, beginning in 2018, entertainment expenses are no longer deductible and the majority of meal expenses are now deductible at 50%.
We first wrote about these changes in this blog post a year ago- and the following checklist provides further clarification on the new rules.
|Category||Previous Deduction||Deduction as of 2018|
|Entertainment: tickets for sporting events, theater, etc.; club expenses; golf course fees; hunting or fishing trips; etc.||50%||0%|
|Meals with clients where business is discussed||50%||50%|
|Meals with clients where business is not discussed (this is classified as entertainment)||50%||0%|
|Meals with employees where business is discussed||50%||50%|
|Meals with employees where business is not discussed (this is classified as entertainment)||50%||0%|
|Food and snacks provided for employees (not considered part of compensation)||100%||50%|
|Company picnics and parties||100%||100%|
|Meals for employees while they are on business travel||50%||50%|
|Meals and entertainment included in an employee's compensation package||100%||100%|
Do you have questions on how to classify your meals and entertainment expenses? Contact Sweeney Conrad’s Senior Tax Associate Darren Reed at email@example.com.
What you need to know...
On April 27, 2019, the Washington state legislature passed bill SB 5998, increasing Washington’s Real Estate Excise Tax (REET). The final version of the bill is expected to be signed by Governor Inslee shortly, and will go into effect January 1, 2020. Below is a summary of the current law and the changes you will see in 2020:
It’s January and that means time to start thinking about those 2018 taxes! At this point, tax documents have probably started showing up in your mailbox. While it may seem like there is plenty of time, the sooner and more organized you can make your documents, the smoother the process will be.
Tax Reform 2.0 was unveiled Monday evening, Sept 10th, and includes three bills which build upon and make permanent changes made by the Tax Cuts and Jobs Act. The first bill, the Protecting Family and Small Business Tax Cuts Act of 2018 makes TCJA tax rates permanent, along with key deductions and the new Sec. 199A 20% Pass-Through Deduction.
Many people go to the doctor for a physical checkup every year or so to make sure they are in good health. If you are the owner of a small business, how do you gauge the “health” of your company?
One way is to keep an eye on several metrics that can help you monitor your company’s health in key areas. These metrics commonly take the form of financial ratios that can be compared against other businesses that are similar to yours, or against prior performance periods for your company- a process known as benchmarking.
We all know the feeling… it’s time to clean the office and you’re sorting through stacks of documents, filing them away, shredding some, creating more piles… and the questions keep arising. Can I toss this? Is this something important to keep? I’ve been holding on to this for 3 years, surely it’s OK to let it go now?
While many changes created by the Tax Cuts and Jobs Act have grabbed the media limelight, not much attention has been given to a new tax benefit: Qualified Opportunity Funds. Beginning in 2018, a taxpayer can elect to reinvest proceeds from the sale of “any property” into a Qualified Opportunity Fund and defer the gain.