B.A. Harris Blog

Accountable Plans and Fringe Benefits

As an increasing number of individuals begin to work from home, either by choice or otherwise, many employers have begun to pay for expenses incurred by their employees in an effort to support their remote working environment, while others have begun offering certain fringe benefits to boost morale or show appreciation. We have fielded many questions from our clients as to the tax consequences to both the employers and employees in these types of situations, and ultimately the deciding factors are:


Tax Strategies: Reducing Taxable Residential Rental Income

For landlords of residential rental properties, one of the most powerful tools in tax planning is the appropriate timing of major expenditures. Coupled with an understanding as to whether those significant costs are fully deductible in the year they are incurred, or expensed over 5 to potentially 27.5 years, can play a significant factor in the decision-making process for property owners. Due to the sweeping changes in tax law with the passage of the Tax Cuts and Jobs Act of 2017 (TCJA) and the recent CARES Act, many of our clients have understandably been faced with confusion over this matter as there are elections for immediate expensing, accelerated depreciation methods, Section 179, Bonus depreciation, and the deduction for “qualified leasehold improvement property.


Changes to FORM 1099-MISC and New FORM 1099-NEC

Last used in 1982, and to alleviate confusion caused by the PATH Act, the IRS has reinstated Form 1099-NEC which will be used to report Nonemployee Compensation (NEC) for tax year 2020. The new 1099-NEC is used to report any payment of $600 or more to payees which was previously reported in Box 7 on Form 1099-MISC. While the 1099-NEC remains largely unchanged, the new form 1099-NEC will only be used for reporting NEC.


Surviving the CPA Exam

There are three components to becoming a CPA: education, examination, and experience. For most candidates, examination is the most intimidating part. The Uniform CPA Exam – standardized nationally – is comprised of four sections: Auditing and Attestation (AUD) Business Environment and Concepts (BEC) Financial Accounting and Reporting (FAR) Regulation (REG) Each exam is made up of multiple-choice questions and task-based simulations “SIMS”. BEC includes a written communication portion as well.


Idaho Tax Deduction for First-Time Home Buyers

With real estate costs across Idaho continuing to rise, the prospect of home ownership for many first-time homebuyers may seem more financially daunting than ever for some Gem State taxpayers. Thankfully, beginning in 2020, a new law has passed in an attempt to aid first-time homebuyers in the state of Idaho through potential tax benefits. Idaho Code section 63-3022V: Deduction For First-Time Home Buyers, allows individuals who open a First-Time Home Buyer Savings Account deductions on their Idaho return equal to their contributions into the account (maximum $15,000 a year for single filers, $30,000 for married couples), with a lifetime deduction limit of up to $100,000.


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