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Dear Landlords & Real Estate Titans:
The Tax Cuts and Jobs Act tax reform added new tax code Section 199A, which created a 20 percent tax deduction possibility for you if your rental property (a) has profits and (b) can qualify as a trade or business.
What are the benefits of the new Tax Cuts and Jobs Act tax reform for rental property?
As the law now stands, with rentals that achieve trade or business status, you win. Your business-status rental property creates the following five possible tax benefits for you:
- Your rental property can create a Section 199A tax deduction of up to 20 percent of the rental property’s qualified business income.
- Your rental property receives tax-favored Section 1231 treatment, which (upon sale) delivers with a tax loss—an ordinary loss (the best kind of loss)—and with a tax-favored capital gain (the best kind of gain).
- Your rental property can create the home-office deduction if you meet the other home-office requirements of exclusive and regular use.
- Your rental-business status creates rental property deductions for the cost of your attendance at rental property meetings, seminars, and conventions.
- Your rental-business status enables Section 179 expensing for certain assets used in the business (special rules apply to the real property).
If you would like to discuss your rental property’s status as a trade or business or any other aspect of the rental, please call me on my direct line at 980-237-1714.
GP CPA P.C.
The Employee Retention Credit (“ERC”) has had some upgrades and retrofits to some of the basic calculations with the most recent (12.27.20) CARES Act changes.
We are glad to inform you that Justin Prusiensky, Chief Executive Officer of the GP CPA P.C. was featured on WCNC Charlotte coverage about “Are Unemployment Benefits Taxable”. If you missed it on TV, you can watch a video featuring GP CPA on the WCNC Charlotte website.
Congress extended some of the tax breaks retroactively to January 1, 2018. They now expire on December 31, 2020. Learn more about tax breaks that have been extended.
GP CPA offers a wide range of business advisory services that are tailored to the needs of business owners. For those small businesses who need someone to keep the books, we can do that.
Take control back from the big box payroll companies and work with someone who can guide you to a better payroll process. GP CPA + GUSTO is the modern way payroll runs and the partnership that moves your business forward.