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Tax Saving Tips - November 2019

2019 Year-End Strategy Edition

2019 Last-Minute Section 199A Strategies That Reduce Taxes Remember to consider your Section 199A deduction in your year-end tax planning.
If you don’t, you could end up with a big fat $0 for your deduction amount. We’ll review four year-end moves that (a) reduce your income taxes and (b) boost your Section 199A deduction at the same time.
First Things First
If your taxable income is above $160,700 (or $321,400 on a joint return), then your type of business, wages paid, and property can reduce and/or eliminate your Section 199A tax deduction.
If your deduction amount is less than 20 percent of your qualified business income (QBI), then consider using one or more of the strategies described below to increase your Section 199A deduction.
1. Harvest Capital Losses
Capital gains add to your taxable income, which is the income that
·determines your eligibility for the Section 199A tax deduction, ·sets the upper limit (ceiling) on the amount of your Section 199A tax d…

Tax-Saving Tips - July 2019

Tax-Saving Tips July 2019
Proven Tax Reduction Strategies for Sole Proprietors If you operate your business as a sole proprietorship, there are many strategies to reduce your taxes.
Let’s start with the following 10: Use the Section 105 plan to make your health insurance a tax-favored business deduction on your Schedule C.Employ your under-age-18 child to make taxable income disappear.Employ your spouse without paying him or her a W-2 wage.Rent your office, even your home office, from your spouse to save self-employment taxes.Establish that an office in your home is your principal office to increase (yes, increase!) your vehicle deductions and also turn personal home expenses into business expenses.Give yourself flowers, fruit, and books as tax-deductible fringe benefits.Combine the home office and a heavy SUV, crossover vehicle, or pickup truck to grab big deductions this year.Design a business trip that includes some personal days—days you tre…

Tax-Saving Tips - June 2019

Tax-Saving Tips June 2019
Combine Home Sale with the 1031 Exchange You don’t often get the opportunity to even consider making a tax-saving double play. But your personal residence combined with a desire for a rental property can provide just such an opportunity.
The tax-saving strategy is to combine the tax-avoidance advantage of the principal residence gain exclusion break with the tax-deferral advantage of a Section 1031 like-kind exchange. With proper planning, you can accomplish this tax-saving double play with full IRS approval.
The double play is available if you can arrange a property exchange that satisfies the requirements for both the principal residence gain exclusion break, and tax deferral under the Section 1031 like-kind exchange rules.
The kicker is that tax-deferred Section 1031 exchange treatment is allowed only when both the relinquished property (what you give up in the exchange) and the replacement property (what you acquire in the exchange) are used for business or i…