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April 23, 2018

The recent tax reform contains two big changes to how much you can deduct in mortgage interest for tax years 2018 through 2025:

  1. During this seven-year period, you may not deduct any interest on prior or current home equity debt, with certain exceptions.

  2. Also during this seven-year period, the maximum amount you may treat as acquisition debt for homes purchased after December 15, 2017, is $750,000.

Exc...

April 16, 2018

Tax reform created a new 20 percent tax deduction for select pass-through entities. Will your business operation create the 20 percent tax deduction for you?

If not, and if that is due to too much income and a lack of (a) wages and/or (b) depreciable property, a switch to the S corporation as your choice of business entity may produce the tax savings you are looking for.

To qualify for the full 20 percent deducti...

April 2, 2018

The tax law has mistreated hobbies for a long time. But the most recent tax reform brings the grim reaper to the party, and it’s not pleasant.

This means you need to focus on making your activity a business and not a hobby.

Under both prior law and the new law after the recent tax reform, your activity is either a business (for profit) or a hobby (not for profit). With the hobby classification, tax law makes you...

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