Daily Archives: April 3, 2018


Patience is Prudent

The Tax Cuts and Jobs Act (TCJA) of 2017, passed at year end, has been called the most extensive tax legislation in more than 30 years. It’s certainly far reaching, covering individual income taxes, business income taxes, and estate taxes. The new law has many tax saving opportunities as well […]


Know Your True Tax Rate

It has been widely reported that the TCJA lowers federal income tax rates for many people. The highest tax rate, for example, has fallen from 39.6% to 37%. Many people who are in lower brackets also stand to benefit. Example 1: Alice Young had $100,000 of taxable income in 2017. […]


Rethinking Retirement Contributions

The TCJA generally lowered federal income tax rates, with some exceptions. Among the ways in which lower rates impact tax planning, they make unmatched contributions to traditional employer retirement plans less attractive. Example 1: Chet Taylor has around $100,000 in taxable income a year. Chet contributed $12,000 to his company’s […]


Regard Roth Conversions Carefully

The article “Rethinking retirement contributions” explains why the new TCJA devalues putting money into traditional tax-deferred plans and favors Roth versions. Does the same reasoning apply to conversions from Roth to traditional accounts? From a tax viewpoint, the answer may be yes, but other factors indicate you should be cautious […]


Positive Prognosis for Medical Deductions

Many miscellaneous itemized deductions, including unreimbursed employee business expenses (see the CPA Client Bulletin, February 2018), no longer can be used to reduce your income, starting with 2018 tax returns. Some observers predicted a similar demise for medical and dental expenses. As it turned out, these deductions not only were […]


Home Equity Hassle

A key component of the TCJA is the expansion of the standard deduction. The numbers for 2018 are $24,000 (married couples filing jointly), $18,000 (heads of household), and $12,000 (all others). These amounts are almost double the respective standard deductions in 2017. However, personal exemptions were eliminated. As a give-and-take, […]


New Tax Deduction for Pass-Through Entities

Many small businesses are pass-through entities, including S corporations, partnerships, sole proprietorships, LLCs, and LLPs. The label indicates that all business earnings are passed through to the owners’ personal income tax returns. Thus, they avoid the corporate income tax. The TCJA contains a new tax benefit for pass-throughs. This provision […]