Tax Tuesday with Toby Mathis 09-15-2020

Give your children a purpose, not money. Toby Mathis and Jeff Webb of Anderson Advisors answer tax questions related to passive versus active income reported on payroll for people of all ages to flipping properties and real estate investments. Do you have a tax question? Submit it to taxtuesday@andersonadvisors.

 

Highlights/Topics: 

• If I have a small business, do I need to make it an LLC to hire my children, or can I just be an independent contractor and hire them? LLC is not required for small businesses, but it is recommended for liability protection; your children’s wages should be run through payroll, even if they don’t have social security numbers
• I just bought a house, paid 30k in cash, and spent about $15k in rehab. What expenses of this deal can I write off, besides the rehab cost? Depends on whether you are flipping the property or using it as an investment property; capitalize all of it because you can’t write off the expenses as repairs
• If I am a real estate professional in 2020, can I offset previous years’ passive losses in this year? No, only for 2020 and only for years you were a real estate professional
• Can you put a primary residence into a land trust and/or LLC to maintain anonymity, if you have a commercial bank loan? If not, are there other options available? LLC or land trust is possible, but it’s not the best idea because it could impact homestead  

 

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Resources:

 

The Tax Toolbox (only $595; regularly $1,500)

http://aba.link/ttb920

Tax-Wise Workshop

https://andersonadvisors.com/tax-wise-workshop-for-businesses-investors/

1031 Exchange

https://www.irs.gov/pub/irs-news/fs-08-18.pdf

Real Estate Professional Requirements

https://www.irs.gov/pub/irs-utl/33-Real%20Estate%20Professionals.pdf

Wills and Trusts

https://andersonadvisors.com/living_trusts/

Opportunity Zones

https://www.irs.gov/credits-deductions/opportunity-zones-frequently-asked-questions

Qualified Opportunity Fund

https://www.irs.gov/credits-deductions/businesses/invest-in-a-qualified-opportunity-fund

Form 8996

https://www.irs.gov/forms-pubs/about-form-8996

Capital Gains Exclusion/Section 121

https://www.irs.gov/taxtopics/tc701

CARES Act

https://www.sbc.senate.gov/public/index.cfm/guide-to-the-cares-act

Individual Retirement Arrangements (IRAs) 

https://www.irs.gov/retirement-plans/individual-retirement-arrangements-iras

Traditional and Roth IRAs

https://www.irs.gov/retirement-plans/traditional-and-roth-iras

Small Business Administration (SBA)

https://www.sba.gov/

1099 Form

https://www.irs.gov/businesses/small-businesses-self-employed/am-i-required-to-file-a-form-1099-or-other-information-return

Form W-2

https://www.irs.gov/forms-pubs/about-form-w-2

Self-Employment Tax

https://www.irs.gov/taxtopics/tc554

Bonus Depreciation

https://www.irs.gov/newsroom/new-rules-and-limitations-for-depreciation-and-expensing-under-the-tax-cuts-and-jobs-act

Depreciation Recapture

https://www.investopedia.com/terms/d/depreciationrecapture.asp

Cost Segregation

https://www.irs.gov/businesses/cost-segregation-audit-techniques-guide-chapter-1-introduction

Tax Cuts and Jobs Act (TCJA)

https://www.irs.gov/tax-reform

Healthcare Reform (Affordable Care Act)

https://www.healthcare.gov/

26 U.S. Code Section 469(c)(7) 

https://www.law.cornell.edu/uscode/text/26/469

26 U.S. Code Section 280A

https://www.law.cornell.edu/uscode/text/26/280A

MileIQ

https://www.mileiq.com/

Mar-a-Lago

https://www.maralagoclub.com/

Schedule A

https://www.irs.gov/forms-pubs/about-schedule-a-form-1040

Schedule C

https://www.irs.gov/forms-pubs/about-schedule-c-form-1040

Federal Reserve Economic Data

https://fred.stlouisfed.org/

Memorandum on Deferring Payroll Tax Obligations in Light of the Ongoing COVID-19 Disaster

https://www.whitehouse.gov/presidential-actions/memorandum-deferring-payroll-tax-obligations-light-ongoing-covid-19-disaster/

Economic Injury Disaster Loan (EIDL)

https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/economic-injury-disaster-loan-emergency-advance

Paycheck Protection Program (PPP)

https://home.treasury.gov/system/files/136/PPP--Fact-Sheet.pdf

Paycheck Protection Program (PPP) Flexibility Act

https://www.investopedia.com/paycheck-protection-program-flexibility-act-of-2020-an-overview-4846944

Credits and Deductions

https://www.irs.gov/credits-deductions-for-individuals

Charitable Organizations

https://www.irs.gov/charities-non-profits/charitable-organizations

The Private Vault by Greg Boots

https://www.amazon.com/Private-Vault-Gregory-J-Boots-ebook/dp/B00G71IKNA

Toby Mathis

http://tobymathis.com/about-toby-mathis/

Anderson Advisors

https://andersonadvisors.com/

Anderson Advisors Events

https://andersonadvisors.com/all-events/

Events@andersonadvisors.com

Anderson Advisors Tax and Asset Protection Event

https://andersonadvisors.com/asset-protection/

Anderson Advisors on YouTube

https://www.youtube.com/channel/UCX5nh607M8hSBLiMB9MgbIQ

Anderson Advisors on Facebook

https://www.facebook.com/AndersonBusinessAdvisors/

Anderson Advisors Podcast

https://andersonadvisors.com/podcast/