Zinner & Co. Blog and Newsroom

Extensions are not an Invitation for an Audit

Posted by Zinner & Co. Tax Team on Jan 24, 2020 12:52:05 PM

Due to many changes in the tax law under numerous tax acts that have been implemented over the past decade, including delay in the issuance of tax forms needed to complete individual income tax returns, the compression of the tax preparation and filing season has become even more severe. 

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Topics: Taxes - Corporate & Business, Taxes - Planning, Rules and Returns, Taxes - Individual, taxes

Is This Expense Deductible In 2019?

Posted by Zinner & Co. Tax Team on Jan 20, 2020 8:56:32 AM

The tax code is long and complicated and oftentimes, taxpayers do not know what deductions or credits are available, which means they cannot take advantage of possible savings.

With so many changes under the 2017 Tax Cuts and Jobs Act and the 2019 SECURE Act now in place, changes have been made regarding the deductibility of expenses that both business and individual taxpayers may not be aware of.

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Topics: Taxes - Corporate & Business, Taxes - Planning, Rules and Returns, Taxes - Individual, Tax Cuts and Jobs Act of 2017

The SECURE Act of 2019

Posted by Zinner & Co. Tax Team on Jan 13, 2020 11:56:46 AM

A new piece of legislation enacted in late December will help simplify the retirement system and help individuals increase their savings.

The “Setting Every Community Up for Retirement Enhancement” Act or SECURE Act, which was part of the Further Consolidated Appropriations Act of 2020 expands opportunities for individuals to increase their savings, and makes administrative simplifications to the retirement system.

Among the major changes for individuals are:

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Topics: Taxes - Planning, Rules and Returns, Retirement Planning & IRAs

ALERT: Be Wary of States Circumventing the $10,000 SALT deduction limitation

Posted by Zinner & Co. Tax Team on Sep 20, 2018 10:19:00 AM

Current Law:

The Tax Cuts and Jobs Act of 2017 limits individual taxpayer's state and local tax (SALT), itemized deduction to $10,000 (including real estate taxes). The previous law allowed an unlimited deduction. This change may be detrimental to many individual taxpayers who relied heavily on these deductions in the past.

State Work-Arounds:

Some states have considered "work-arounds" to combat this limitation. Select states (California, Connecticut, Illinois, New York and New Jersey, thus far) have created state

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Topics: Taxes - Planning, Rules and Returns, Taxes - Individual, deductions, taxes, IRS, tax avoidance, Tax Cuts and Jobs Act of 2017

Are my sales tax payments on major purchases still tax deductible?

Posted by Zinner & Co. Tax Team on Aug 30, 2018 9:34:55 AM

For many individuals, September means it is time to look for a new car since the upcoming year’s automobile models are introduced.

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Topics: Taxes - Planning, Rules and Returns, Taxes - Individual, Tax Cuts and Jobs Act of 2017

Groundbreaking Sales & Use Tax Case Decided by the Supreme Court

Posted by Matt Szydlowski, CPA on Jun 29, 2018 8:38:52 AM

On June 21, the Supreme Court handed down a landmark decision in South Dakota vs. Wayfair (“Wayfair”).   The fallout of this decision will significantly change the way online vendors handle sales and use (“S&U”) tax for out-of-state consumers going forward.  It will, therefore, also affect online consumers.  Are you impacted!?

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Topics: Taxes - Corporate & Business, Taxes - Planning, Rules and Returns, Taxes - Individual, taxes

Rethinking retirement contributions

Posted by Zinner & Co. Tax Team on Jun 11, 2018 3:47:00 PM

The Tax Cuts and Jobs Act of 2017 generally lowered federal income tax rates, with some exceptions. Among the ways in which lower rates impact tax planning, they make unmatched contributions to traditional employer retirement plans less attractive.

Example 1: Chet Taylor has around $100,000 in taxable income a year. Chet contributed $12,000 to his company’s traditional 401(k) in 2017, reducing his taxable income. He was in the 28 percent tax bracket last year, so his federal tax savings were $3,360 (28 percent of $12,000). An identical contribution this year will save Chet only $2,880, because the same income would put him in a lower 24 percent bracket.

Not everyone will be in this situation.

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Topics: Taxes - Planning, Rules and Returns, Retirement Planning & IRAs, Tax Cuts and Jobs Act of 2017

IRS Okays home equity deductions

Posted by Zinner & Co. Tax Department on Jun 7, 2018 12:30:00 PM

The Tax Cuts and Jobs Act of 2017 affected the tax deduction for interest paid on home equity debt as of 2018.

Under prior law, you could deduct interest on up to $100,000 of home equity debt, no matter how you used the money. The old rule is scheduled to return in 2026.

The bad news is that you now cannot deduct interest on home equity loans or home equity lines of credit if you use the money for college bills, medical expenses, paying down credit card debt, etc.

The good news is that the IRS has announced “Interest on Home Equity Loans Often Still Deductible Under New Law.”

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Topics: real estate, financing, Taxes - Planning, Rules and Returns, Taxes - Individual, home, Tax Cuts and Jobs Act of 2017

The new tax law will change divorce tactics

Posted by Zinner & Co. Tax Team on May 7, 2018 2:55:00 PM

When couples divorce, financial negotiations often involve alimony. The tax rules regarding alimony were dramatically changed by the Tax Cuts and Jobs Act (TCJA) of 2017, but existing agreements have been grandfathered. In addition, the old rules remain in effect for divorce and separation agreements executed during 2018. Next year, the rules will change, and the roles will be reversed.

Under divorce or separation agreements executed in 2018, and for many years in the past, alimony payments have been tax deductible. Moreover, these deductions reduce adjusted gross income, so they may have benefits elsewhere on a tax return. While the spouse or former spouse paying the alimony gets a tax deduction, the recipient reports alimony as taxable income.

Shifting into reverse

Beginning with agreements executed in 2019, there will be no tax deduction for alimony. As an offset, alimony recipients will not include the payments in income.

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Topics: alimony, divorce, Taxes - Planning, Rules and Returns, Taxes - Individual, taxes, tax avoidance, Tax Cuts and Jobs Act of 2017

“Kiddie Tax” impacted by Tax Cuts and Jobs Act

Posted by Zinner & Co. Tax Team on Apr 18, 2018 12:39:00 PM

Many higher income taxpayers have long made it a practice to open investment accounts for their children, hoping to take advantage of their lower tax rates.  Many years ago, Congress imposed, what is colloquially known as the “kiddie tax” to place strict limits on the amount of investment income that can be taxed at those lower rates. 

One of the changes made by the recently enacted Tax Cuts and Jobs Act of 2017 made some significant changes to how the “kiddie tax” is administered, impacting the way adults pass investment income on to their minor children. 

The "kiddie tax" is a provision that taxes the unearned income of children under the age of 19 and of full-time students younger than 24 at a special rate. Under both the new law and the old, the first $1,050 of a child's income is tax-free and the next $1,050 is taxed at a rate of 10 percent.

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Topics: tax services, Taxes - Planning, Rules and Returns, Taxes - Individual, Retirement Planning & IRAs, withdrawls, tuition, tax avoidance, Tax Cuts and Jobs Act of 2017

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