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Lake Wylie Tax Service | Bookkeeping | Payroll Service

Lake Wylie Tax Service | Bookkeeping | Payroll Service

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Category Archives: Tax & Legal Changes

IRS Extends the Opportunity to Defer Capital Gains

Lake Wylie Tax Service | Bookkeeping | Payroll Service Posted on August 25, 2020 by Lake Wylie Tax Services StaffAugust 25, 2020

Capital Gains TaxAs part of tax reform put into place a couple of years ago, individuals are able to defer both short- and long-term capital gains into what are referred to as Qualified Opportunity Zone Funds (QOFs). What is nice about this is that only the actual amount of gain needs to be invested into a QOF to avoid taxes on the gain for the sale year. The gains invested in a QOF are deferred until you cash out of the QOF investment or December 31, 2026, whichever occurs first.

This includes the gain from the sale of all capital assets, such as stocks or bonds, property, rentals, land, and even partnership interests.

Example: You sell 1,000 shares of stock that cost you $20 a share (a total cost of $20,000). You were very fortunate, and the stock had appreciated to $100 a share when you sold them, for a total sales price of $100,000 and a capital gain of $80,000. If you invest the $80,000 gain in a QOF within the required 180 days, the gain on the sale and the tax on the gain are postponed.

Example: Another example would be if you had inherited vacant land several years ago, and the fair market value of the land at the time you inherited it was $50,000. This year, a grocery chain wants to build a grocery store on the land and purchases it from you for $300,000. As a result of the sale, you have a gain of $250,000 ($300,000 – $50,000). If you invest that $250,000 gain in a QOF within the required 180-day period, you can defer the gain and the tax on the sale.

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Posted in Tax & Legal Changes | Tagged Captial Gains Tax, Tax Planning

What the April 15 Tax Filing Deadline Extension Means to You

Lake Wylie Tax Service | Bookkeeping | Payroll Service Posted on March 24, 2020 by Lake Wylie Tax Services StaffMarch 24, 2020

Tax Deadline Extended to July 15The IRS has postponed the due date for filing Federal income tax returns and tax payments due on April 15, 2020 until July 15, 2020. Below are the specifics of those postponements.

Filing Due Date Postponement:

  • The due date for filing 2019 federal income tax returns due April 15, 2020 is postponed to July 15, 2020.
  • This applies to any 2019 federal income tax returns due April 15, 2020. Thus, it applies to:
    o 2019 individual 1040 and 1040-SR tax returns
    o 2019 trust and estate 1041 returns
    o 2019 calendar year corporation returns
    o 2019 association returns (Forms 1120-C and 1120-H)
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Posted in Tax & Legal Changes | Tagged Covid-19, Tax Deadline Extended to July 15

Expecting Your Taxable Income to Be Low This Year? You Can Take Advantage of It

Lake Wylie Tax Service | Bookkeeping | Payroll Service Posted on November 13, 2018 by Lake Wylie Tax Services StaffNovember 21, 2018

If your taxable income is exceptionally low this year, or even if you expect not to be required to file a tax return this year, a number of tax opportunities may be available to you. But time is running short, since these opportunities will require action on your part before year’s end.

However, before we consider actual strategies, let’s look at key elements that govern tax rates and taxable income.

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Posted in Income Tax Preparation, Tax & Legal Changes, Tax Central | Tagged Tax Planning

Tax Reform Infographic

Lake Wylie Tax Service | Bookkeeping | Payroll Service Posted on October 15, 2018 by Lake Wylie Tax Services StaffJanuary 23, 2020

2018 Tax ReformWith so much confusion regarding tax reform, we put together a side by side comparison of the old and new law.

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Posted in 2018 Tax Law Changes, Tax & Legal Changes | Tagged Tax Reform
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