Prior to 2018, the IRS relied on the Consumer Price Index (CPI) to measure inflation and adjust tax brackets to prevent bracket creep. However, the Tax Cuts and Jobs Act of 2017 (TCJA) changed this, and the IRS now uses the Chained Consumer Price Index (C-CPI) to adjust income thresho...
Learn more: Trump and the TCJA: What's next for your tax bill Who has to pay the AMT?For most taxpayers with moderate incomes, determining whether you have to pay the AMT is fairly straightforward: If your taxable income is less than the AMT exemption amount below, then you probably don...
Is Rent Ordinary Income? Rental income is defined by the IRS as “any payment for the use or occupation of property” and is generally taxed as ordinary income. However, landlords can deduct certain costs from this income to reduce the taxable amount. Deductible expenses may include mortgage in...
The IRS allows various tax deductions for expenses related to producing taxable investment income. Do yours qualify? Since maximizing your tax deductions has the potential to reduce your tax burden, let's look at some of the most common deductible investment expenses and how they can reduce your...
What Is Considered a PFIC for U.S. Tax Purposes? The IRS defines a passive foreign investment company (PFIC) as a non-U.S. entity that either earns 75% or more of its gross income from non-business operational activities (the income test); or if at least 50% of its assets are held...
Life insurance is designed to provide financial support to your beneficiaries when you die, replacing lost income. Many policyholders like that idea, but others want the flexibility to tap into their policies’ funds for other needs. Cash-value policies—also known as permanent life insurance, who...
What is a W-8BEN-E Form Used For? The motivation behind filing the W-8BEN-E is to document status for tax reporting purposes. It’s an IRS-mandated form that collects the correct data, including the Nonresident Alien (NRA) taxpayer information for businesses, for the purpose of accurate ...
The Trump administration is likely to prioritize tax reform, aligning with Trump’s previous stance on the 2017 Tax Cuts and Jobs Act (TCJA), and taxpayers should be attentive to these changes in their year-end and 2025 planning. Administrative priorities may include addressing the scheduled phase...
faces the expiration of the Tax Cuts and Jobs Act (TCJA, aka “Trump tax cuts”) at the end of this year. It also comes as the new Trump administration has unleashed a flurry of executive orders that could significantly impact the functioning of federal agencies, including the IRS. So, ...
Unlike individuals, C Corps have to file a designated tax form with the IRS, and C Corporations have their own tax rates. C Corporation Taxation Guide Before 2018, C Corp tax rates depended on how much profit the business made. But the Tax Cuts and Jobs Act (TCJA) of 2018 made it so...