LEVITZACKS, Certified Public Accountants
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Important Accounting Changes on the Horizon that May Impact Your Business...

Click here to read how this change may impact your organization.

Click here to download a summary of the AICPA's Working Group's current issues and their status.

The enactment of the Tax Cuts and Jobs Act in late 2017 (TCJA) was a game changer.  We are well-versed in what the rules of the TCJA purport to be, but there is still much uncertainty in some of the implementation details.  Guidance from the IRS continues to trickle in and with each installment of pronouncements more planning opportunities become apparent, even as consensus among tax advisors about the “real rules” of the game become more established.  The year-end tax planning guides can provide a general overview of major areas to consider as tailored to Individuals, Investors, and Businesses.  Because we stay focused on continuing developments, including potential legislative changes and IRS pronouncements, we encourage you to both check our website at lz-cpa.com/newsletter.html and contact us about any special areas of your concern.

As a result of the TCJA, payroll withholding tables were revised earlier this year.  In some situations, it may be prudent to revisit your claimed withholding exemptions and our year-end projections can assist in that effort.  In addition, there are enhanced deferral techniques, state tax minimization strategies, novel estate planning techniques that combine estate tax minimization with major income tax savings for future generations, and other great ideas we look forward to sharing as they may apply to your unique situations that we encounter.  As thought leaders, we strive to anticipate the next moves of the game in these and several other areas.

In the meantime, we hope you find this year’s general tax planning brochure beneficial, if nothing more than to spark interest in seeking clarification about how the new and existing rules are applied to you.  We look forward to continuing to provide quality tax preparation and exceptional consulting services.


New IRS guidance fills in several more pieces of the Code Sec. 199A passthrough deduction puzzle. Taxpayers can generally rely on all of these new final and proposed rules.


The IRS has issued interim guidance on the excise tax payable by exempt organizations on remuneration in excess of $1 million and any excess parachute payments made to certain highly compensated current and former employees in the tax year. The excise tax imposed by Code Sec. 4960 is equal to the maximum corporate tax rate on income (currently 21 percent).


The IRS has provided safe harbors for business entities to deduct certain payments made to a charitable organization in exchange for a state or local tax (SALT) credit. A business entity may deduct the payments as an ordinary and necessary business expenses under Code Sec. 162 if made for a business purpose. Proposed regulations that limit the charitable contribution deduction do not affect the deduction as a business expense.


The Treasury and IRS have issued final regulations for determining the inclusion under Code Sec. 965 of a U.S. shareholder of a foreign corporation with post-1986 accumulated deferred foreign income. Code Sec. 965 imposes a "transition tax" on the inclusion. The final regulations retain the basic approach and structure of the proposed regulations, with certain changes.


The IRS has issued its annual revisions to the general procedures for ruling requests, technical memoranda, determination letters, and user fees, as well as areas on which the Associate Chief Counsel offices will not rule. The revised procedures are generally effective January 2, 2019.


The IRS has released the 2018 optional standard mileage rates to be used to calculate the deductible costs of operating an automobile for business, medical, moving and charitable purposes. Beginning on January 1, 2018, the standard mileage rates for the use of a car, van, pickup of panel truck will be:

  • 54.5 cents per mile for business miles driven (up from 53.5 cents in 2017);
  • 18 cents per mile for medical and moving expenses (up from 17 cents in 2017); and
  • 14 cents per mile for miles driven for charitable purposes (permanently set by statute at 14 cents).

Comment. A taxpayer may not use the business standard mileage rate after using a depreciation method under Code Sec. 168 or after claiming the Code Sec. 179 deduction for that vehicle. A taxpayer may not use the business rate for more than four vehicles at a time. As a result, business owners have a choice for their vehicles: take the standard mileage rate, or “itemize” each part of the expense (gas, tolls, insurance, etc., and depreciation).


The start of a New Year presents a time to reflect on the past 12 months and, based on what has gone before, predict what may happen next. Here is a list of the top 10 developments from 2017 that may prove particularly important as we move forward into the New Year:


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