$10,000 State and Local Tax Limitation Workaround for Idaho Pass-through Entity Owners
Since its inception in 2017, a major point of contention with the Tax Cuts and Jobs Act has been its limitation of the deduction for state and local taxes on individual returns to $10,000. This limitation, which includes state and local income taxes, real property taxes, and personal property taxes, has resulted in a number of taxpayer’s losing out on federal tax deductions they had previously been afforded, while others have been barred from itemizing on their returns altogether.
Read POSTHuge Changes to the Child Tax Credit: Should You Decline the Advanced Payments?
In response to the U.S.’s continued struggles recovering from the Coronavirus Pandemic, President Biden passed the American Rescue Plan Act (ARPA) in January, which contained a major overhaul to the Child Tax Credit (Provision 9611), a credit which currently benefits nearly 39 million households across the country. Now, not only does the maximum credit per child increase, but taxpayers will no longer have to wait to file their taxes in order to reap the benefits of the credit.
Read POSTTaxation of Virtual Currency
As virtual currency gains increasing acceptance by the public, it is important to consider the tax implications for those that invest and engage in various transactions with the digital currency. What is virtual currency? Virtual currency is a digital representation of value. Although virtual currency is exchangeable in the same manner as real currency, for example the dollar, it is not recognized as legal tender in the United States. Some virtual currencies including Bitcoin and Ethereum are convertible virtual currency, meaning they may be exchanged for an equivalent value of dollars, euros, or other types of real currency.
Read POSTDon’t Miss Out on Employee Retention Credits
Over the Holidays, the Consolidated Appropriations Act, 2021 was signed into law, opening the doors for many businesses to claim the Employee Retention Credit (ERC) who were previously deemed ineligible, and expanded the credit into the 2nd quarter of 2021. Businesses that qualify can claim an ERC for wages paid during an eligible period/quarter of up to $5,000 per employee in 2020, and up to $14,000 per employee in 2021. The fully refundable credit is available against an employer’s share of Social Security tax on employee wages.
Read POST2020 Tax Updates and Year in Review
With 2020 rapidly coming to a close, many of us are eagerly looking forward to 2021 in hopes that less tumultuous times are ahead. While we are all anxious for a better tomorrow, it’s important that we take the time today to look back upon the year and use this opportunity to take advantage of any changes to the tax code that occurred during 2020, and possibly consider a change in our own personal tax strategies.
Read POSTReady to chat?
So are we.
Feel free to contact us with any questions or needs you have. We will get in touch with you right away.
CONTACT USSubscribe to our newsletter, and get periodic updates from our blog as well.
