Tax News for Business Owners

New Pass-Through Deduction for Business Owners:

Owners/Partners of an 1120S, Partnership, or Sole Proprietorship may qualify for a deduction of up to 20% of business income on their 1040 tax return.

Depreciation:

The Section 179 limit increased to $1,000,000 for 2019. And 100% bonus depreciation applies to property placed in service through 2022. The bonus % will decline each subsequent year.

Meals & Entertainment Deduction:

Beginning 2018, entertainment is no longer deductible. Meals are deductible only if there is a business purpose, and only at 50%.

C-Corp:

Effective 2018, the tax rate is now 21%.

Please Note:

This is only a short list of some of the new tax rules. Please spend time with your tax preparer and learn the rules at IRS.gov so you and your advisor are knowledgeable about qualifying expenses, eligible purchases, contributions, gifts, etc., that may help to reduce your tax burden.