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2019 – 01/08 – 2 major tax law changes for individuals in 2019

Most TCJA provisions went into effect in 2018 and apply through 2025 or are permanent, but two major changes affect individuals beginning in 2019: 1) While the TCJA reduced the medical expense deduction threshold from 10% of adjusted gross income to 7.5%, the reduction applies only to 2017 and 2018. So for 2019, the threshold returns to 10%. 2) For divorce agreements executed (or, in some cases, modified) after Dec. 31, 2018, alimony payments won’t be deductible by the payer but will be excluded from the recipient’s taxable income. Contact us for details.

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2019 – 01/14 – Higher mileage rate may mean larger tax deductions for business miles in 2019

A higher IRS mileage rate means larger tax deductions for business miles in 2019. The optional standard mileage rate used to calculate the deductible costs of operating an auto for business has increased by 3.5 cents, to 58 cents per mile. The mileage rate comes into play when businesses don’t want to keep track of actual vehicle-related expenses. But you still must record certain information, such as the mileage, date and destination for each trip. The mileage rate can also be used for reimbursing employees. Many rules and limits apply. Contact us for details.

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2019 – 01/11 – How do profits and cash flow differ?

Cash is king. Unfortunately, the accounting concept of “profits” may not be the best metric for gauging whether a business is on top of its game. There are many reasons profits and cash flow might differ, including changes in working capital, fixed assets, financing and owners’ capital. Business owners need to look beyond profits to ensure they have enough cash on hand to pay employees, suppliers, lenders and even the IRS. If you’re profitable but having trouble making ends meet, we can brainstorm ideas to help you more effectively manage the cash flow cycle.

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2019 – 01/07 – Is there still time to pay 2018 bonuses and deduct them on your 2018 return?

There aren’t too many things businesses can do after a year ends to reduce tax liability for that year. But you might be able to pay employee bonuses for 2018 in 2019 and still deduct them on your 2018 tax return. To be eligible for this favorable tax treatment, you must be an accrual-basis taxpayer and the bonus liability must have been fixed by the end of the tax year, which requires passing the “all-events test” and may necessitate a bonus pool arrangement. If you’re a calendar-year company, you must pay the bonuses by March 15. Contact us to learn more.

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2019 – 01/04 – 4 ideas for fostering a partnership between internal and external auditors

When internal and external auditors collaborate, it’s a win-win. In addition to improving efficiency and avoiding duplication of efforts, working together increases the likelihood that your company’s financial statements will be accurate and timely. Here are four ideas for fostering an effective partnership: 1) Encourage frequent communication. 2) Provide access to internal audit reports. 3) Help external auditors navigate the organization. 4) Conduct joint training sessions. Contact us to brainstorm additional ideas before the start of audit season.

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2018 – 12/31 – A refresher on major tax law changes for small-business owners

The dawning of 2019 means the 2018 income tax filing season will soon be upon us. After year end, it’s generally too late to take action to reduce 2018 taxes. Business owners may, therefore, want to shift their focus to assessing whether they’ll likely owe taxes or get a refund when they file their returns this spring, so they can plan accordingly. With the biggest tax law changes in decades (under the TCJA) generally going into effect beginning in 2018, most businesses and their owners will be significantly impacted. Contact us for a refresher on the changes.

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2019 – 01/02 – A review of significant TCJA provisions impacting individual taxpayers

Now that 2019 has begun, there isn’t too much you can do to reduce your 2018 income taxes. But it’s smart to begin preparing for filing your 2018 return. Because the TCJA, signed into law at the end of 2017, likely will have a major impact on your 2018 taxes, it’s a good time to review the most significant provisions affecting individual taxpayers. For example, it generally reduces tax rates. And it nearly doubles the standard deduction and expands the child tax credit. But it also reduces or eliminates many breaks. Contact us to review the changes affecting you.

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2018 – 06/01 – Don’t let collaborative arrangements cause financial reporting headaches

Businesses often enter into so-called “collaborative arrangements” when embarking on a major project, such as designing a new medical device or producing a film. However, the rules for reporting shared costs and revenue under U.S. GAAP are unclear, and the new revenue recognition standard has added to the confusion. In April, the Financial Accounting Standards Board issued a proposal to help clarify matters. We’re atop recent developments on reporting collaborative arrangements. Contact us with questions or to help you implement the latest guidance.

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2018 – 12/26 – You may be able to save more for retirement in 2019

Retirement plan contribution limits are indexed for inflation, and most have increased for 2019. So you may have opportunities to increase your retirement savings. Limits for 401(k)s, SIMPLEs and IRAs increase by $500, to $19,000, $13,000 and $6,000, respectively. Catch-up contributions (for taxpayers age 50 or older) remain unchanged, however. They’re $6,000, $3,000 and $1,000, respectively. Additional factors may affect how much you’re allowed to contribute. For more on how to make the most of tax-advantaged retirement-saving opportunities in 2019, contact us.

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