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Homeowner's Insurance Protects a Prime Asset

From coast to coast, hurricanes and wildfires and other natural disasters have created headlines while destroying homes. Your principal residence is probably a valuable asset, so you should be confident your homeowner’s insurance can protect you against multiple perils. Chances are, your first experience with homeowner’s coverage probably coincided with your first home purchase, which you financed... Read More

April/May 2019 Dates to Remember

April 15 Individuals. File a 2018 income tax return and pay any tax due by April 15 (if you live in Maine or Massachusetts, the filing deadline is April 17). If you want an automatic six-month extension of time to file the return, file Form 4868, “Application for Automatic Extension of Time To File U.S. Individual Income Tax Return.” Then, file Form 1040 by October 15. If you are not paying your... Read More

Roth Solo 401(k)s for Small Businesses

The Tax Cuts and Jobs Act (TCJA) of 2017 was not officially focused on retirement planning, but it has had a major impact on the choice of retirement plans. After-tax plans, known as Roth accounts, may be more practical now. That can be especially true regarding solo 401(k)s, which are 401(k) plans that cover business owners (including sole proprietors) without employees (other than the owners and their... Read More

The Standard Deduction's Double Standard

The 2019 “tax season,” during which most 2018 tax returns are prepared, will soon peak at the April 15 deadline. One key trend is that more people are taking the standard deduction, which has increased significantly, and fewer people are claiming itemized deductions, which have been restricted. These changes result from passage of the Tax Cuts and Jobs Act (TCJA) of 2017, which affects preparation of... Read More

March/April Dates to Remember

March 15 Partnerships. File a 2018 calendar-year return (Form 1065). Provide each partner with a copy of Schedule K-1 (Form 1065), Partner’s Share of Income, Deductions, Credits, etc., or a substitute Schedule K-1 (Form 1065). If you want an automatic six-month extension of time to file the return and provide Schedule K-1 or a substitute Schedule K-1, file Form 7004. Then, file Form 1065 and provide each... Read More

Deducting Qualified Business Income

The TCJA created a new deduction for small business owners who operate pass-through entities. That includes domestic companies operated as sole proprietorships or through S corporations, partnerships, certain LLCs, trusts, and estates. Income from such entities may allow business owners to deduct 20% of their qualified business income (QBI). On the surface, the deduction may seem straightforward. Example 1:... Read More

Handling Qualified Charitable Distributions

As the filing season for 2018 tax returns reaches a peak, many people will learn that they’re no longer itemizing deductions. The TCJA placed limits on some deductions and increased the standard deduction significantly, so most taxpayers are taking the standard deduction, rather than itemizing. One result is that charitable contributions offer no direct tax benefit for many donors. An indirect benefit... Read More

The New Math of Municipal Bonds

Stock market volatility has some investors thinking about putting some money into bonds, which historically have offered relatively stable prices. One key decision facing bond market investors is whether to choose regular, taxable bonds or tax-exempt municipal bonds. (This discussion concerns investments in taxable accounts because tax-exempt municipals and muni funds typically don’t belong in a tax-favored... Read More

February/March Dates to Remember

February 15 All businesses. Give annual information statements (Forms 1099) to recipients of certain payments you made during 2018. Payments that are covered include (1) amounts paid in real estate transactions;(2) amounts paid in broker and barter exchange transactions; and (3) substitute payments and gross proceeds paid to attorneys. Employers. For Social Security, Medicare, withheld income tax, and... Read More