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Tax-Saving Tips - February 2020

Use Your Business to Maximize Charitable Donations Giving to your church, school, or other 501(c)(3) charity is a noble act no matter how you choose to give.
But for the purposes of tax savings, some forms of giving are much more beneficial to you than are others. As a business owner, you can use some business strategies to get the money to these institutions as business expenses.
While this does not change anything from the institution’s perspective, it hugely increases your tax savings. The Tax Cuts and Jobs Act (TCJA) makes it harder to benefit from your personal donations.
Let’s say you donate $10,000 to a church, school, or other 501(c)(3) charity:
1.Will you get a tax deduction—in other words, will you itemize? 2.Will you benefit from the entire $10,000 as an itemized deduction? In other words, did the $10,000 simply put you over the hump that beat the standard deduction? 3.Say you can deduct all $10,000 as an itemized deduction. Would making it a business deduction increase the tax…

Tax-Saving Tips - January 2020

Congress Reinstates Expired Tax Provisions Congress let many tax provisions expire on December 31, 2017, making them dead for your already-filed 2018 tax returns.
In what has become a much too common practice, Congress resurrected the dead provisions retroactively to January 1, 2018. That’s good news. The bad news is that if you have any of these deductions, we have to amend your tax returns to make this work for you.
And you can relax when filing your 2019 and 2020 tax returns because lawmakers extended the “extender” tax laws for both years. Thus, no worries until 2021—and even longer for a few extenders that received special treatment.
Back from the Dead
The big five tax breaks that most likely impact your Form 1040 are as follows:
1.Exclusion from income for cancellation of acquisition debt on your principal residence (up to $2 million) 2.Deduction for mortgage insurance premiums as residence interest 3.7.5 percent floor to deduct medical expenses (instead of 10 percent) 4.Above-the-line t…