Demystifying Casualty Loss Deductions

June 23, 2020

The days when you could claim deductions for run-of-the-mill casualty and theft losses of personal property are gone — at least temporarily. The Tax Cuts and Jobs Act (TCJA) generally suspends write-offs for such expenses for 2018 through 2025.

However, you can still claim deductions for personal property losses caused by certain federally declared disasters, such as the COVID-19 pandemic. In addition, the Taxpayer Certainty and Disaster Tax Relief Act enhanced deductions available to eligible individuals — but only for a limited time. Here are the details.

Read more

Crunching Numbers for Multiple Corporations

June 23, 2020

It might be advantageous from a tax standpoint to run a business through multiple entities. For example, a construction company might form a separate company to own and lease its trucks and equipment back to its related entities. Or a corporation might transfer appreciated property to an affiliated corporation in order to limit risk in case it is sued.

Read more

Lock in Home Office Deductions

December 5, 2018

Home Office DeductionsThe tax law permits you to deduct home office expenses if you “regularly and exclusively” use an area of your home as either:

  • Your principal place of business.
  • A place to meet or deal with clients, customers or patients in the normal course of business.

Read more

Tax Court Sets Boundaries on Commuting Deductions

November 30, 2018
Commuting Deductions

Commuting between your residence and place of business are generally non-deductable, but there are a few exceptions.

Although you usually can’t deduct typical “commuting” expenses from home, you may qualify for a special exception if you’re away working on temporary assignments. But the IRS and the U.S. Tax Court won’t allow borderline deductions, as evidenced by one case involving a construction worker.

We’ll explain what happened in the case, but first, here is some background information. Read more

Calculating Deductions for Business Interest Expense

July 24, 2018
interest expense

The Tax Cuts and Jobs Act generally limits business interest expense deductions for businesses with average annual gross receipts over $25 million, with a few industry-specific exceptions.

One of the most complicated provisions of the Tax Cuts and Jobs Act (TCJA) is the new limitation on deductions for business interest expense. At face value, this limitation seems straightforward, but the devil is in the details. Read more