Legislative Watch 2018
In the waning days of 2017, many policy issues affecting the apartment industry have been front and center for Congress and the administration.
Home vs. away: The company retreat conundrum
Many people assume a company retreat must happen off-site. Not true: An on-site retreat is a cost-effective option. You won’t have to rent space and can probably save on locally catered food and bulk beverages. But employees often struggle to focus and find inspiration in-house. Off-site events can be a welcome and exciting change of pace. When planning one, be ready to negotiate. Get multiple quotes and compare prices for space, food and beverages, and guest rooms if you’ll need them. Don’t be shy about asking for discounts. Contact us for more ideas and info.
Home-related tax breaks are valuable on 2017 returns, will be less so for 2018
If you own a home, you may be eligible for several valuable breaks when filing your 2017 return. But under the Tax Cuts and Jobs Act, your home-related breaks may not be as valuable next year. Affected breaks include deductions for property tax, mortgage interest, home-equity-debt interest and home office expenses. Also, a mortgage-insurance premium deduction and a debt forgiveness exclusion expired Dec. 31, 2017, but they might be extended. We can help you determine which breaks you can claim on your 2017 return and how your 2018 tax situation may be affected.
Defer tax with a Section 1031 exchange, but new limits apply this year
Normally when appreciated business assets such as real estate are sold, tax is owed on the appreciation. But there’s a way to defer this tax: a Section 1031 “like kind” exchange where, instead of selling appreciated property, you exchange it solely for property of a “like kind.” Virtually any type of real estate will qualify as long as it’s business or investment property. But the Tax Cuts and Jobs Act generally eliminates this favorable tax treatment for personal property. Considering a like-kind exchange? Contact us to ensure you comply with the complex rules.
Make sure repairs to tangible property were actually repairs before you deduct the cost
Repairs businesses made to tangible property (such as buildings, machinery, equipment or vehicles) last year generally can be immediately expensed and fully deducted on 2017 income tax returns. But costs incurred last year to improve such property must be depreciated over a period of years, providing a much smaller 2017 deduction. Distinguishing between repairs and improvements can be difficult. Fortunately, some IRS safe harbors can help. To learn about the safe harbors and other ways to maximize your tangible property deductions, contact us.
Casualty losses can provide a 2017 deduction, but rules tighten for 2018
If you suffered damage to your home or personal property last year, you may be able to deduct these “casualty” losses on your 2017 federal income tax return. A casualty is a sudden, unexpected or unusual event, such as a natural disaster, fire, accident, theft or vandalism. Many rules and limits apply; some are loosened for victims of Hurricanes Harvey, Irma and Maria and certain California wildfires. For 2018 through 2025, this deduction is suspended except for losses due to an event officially declared a disaster by the President. Contact us for details.
Building a sales prospect pipeline for your business
A business will miss revenue opportunities if it doesn’t have a solid pipeline to funnel prospects to its sales team. To build one, profile customers that best suit your products or services. Use criteria such as location, industry and needs. Integrate companywide marketing initiatives with each salesperson’s efforts. When ready to reach out, consider three methods: 1) cold calls (customized as much as possible), 2) researched cold calls to a specific individual with the prospective company, and 3) referrals procured from a well-developed network of sources.
Don’t forget: 2017 tax filing deadline for pass-through entities is March 15
The federal income tax filing deadline for calendar-year partnerships, S corporations and LLCs treated as partnerships or S corporations for tax purposes is March 15, about a month earlier than the deadline for personal returns. If you haven’t filed your partnership or S corporation return yet, you may be thinking about an extension. An extension can be tax-smart if you’re missing critical documents or an unexpected life event is preventing you from devoting sufficient time to your return now. But there are additional considerations. Contact us to learn more.
Size of charitable deductions depends on many factors
Whether you’re claiming charitable deductions on your 2017 return or planning your donations for 2018, be sure you know how much you’re allowed to deduct. Your deduction depends on not only the amount you give, but also what you give (for example, cash, property or services), whether your total donations for the year exceed certain income-based limits, whether you receive a benefit from the charity, and even how the charity uses the gift. Other rules and limits also apply, and the TCJA could affect your deductions for your 2018 donations. Contact us to learn more.
7 ways to prepare your business for sale
Succession planning can be a complex, delicate matter involving family members and a long transition out of the company. Another approach is to simply sell and move on. If you’re leaning this way, there are many ways to prepare: Develop or update your business plan and ensure your management team is ready to move forward without you. Upgrade IT systems so your company is “plug and play.” Obtain a professional valuation and optimize your balance sheet. Get ready for plenty of paperwork, too, and don’t forget to consider the tax impact. Contact us for help.