2 July By Webmaster | mendasweed

Saving for your child’s education? 529 Plan Changes Beginning in 2018

little girl laughing
  Under the Tax Cuts and Jobs Act, moneys withdrawn from a 529 Plan in an amount up to $10,000.00 and paid towards a child’s annual tuition expenses at a private or religious elementary or secondary public school are excluded from gross income.  This only applies to tuition.  This also only applies at the federal level. California currently does not conform to the new federal laws with respect to 529 plans.  This means that if…
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25 June By Webmaster | mendasweed

Top 3 Reasons You Need a Revocable Living Trust

revocable living trust
  With the new tax law, and some of the new estate tax provisions, many individuals may find themselves asking if they still need a revocable living trust. Avoid Probate One of the main reasons to have a trust as a part of your estate plan is to avoid probate.  In California, if your estate is worth more than $150,000, your estate is subject to probate.  If your estate is worth less than $150,000, there…
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4 June By Webmaster | mendasweed

California wants to increase your tax deductions. The IRS is trying to prevent that.

the treasury department building in washington, dc.
  At the end of May, 2018, the IRS issued Notice 2018-54.  The Notice indicates that the IRS is working on proposed regulations to address State attempts to circumvent the new laws regarding the deductibility of state and local tax payments on an individual’s federal income tax return. See SB 227, which would have started the California Excellence Fund allowing taxpayers to make payments to the fund and deduct those payments as charitable deductions.  This…
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15 May By Webmaster | mendasweed

Top 3 Ways to Hack the Tax Cuts and Jobs Act

open calendar on table
  Update your W-4   Taxpayers can no longer claim a personal exemption.  Make sure you have proper wage withholding.  If you enjoy getting a refund when you file taxes, and you don’t want to owe, you will likely need to update your W-4   Get your medical procedure you’ve been putting off done in 2018   The AGI floor for itemizing medical deductions is now 7.5% instead of the previous 10%.  In other words…
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23 April By Webmaster | mendasweed

Tax Cuts and Jobs Act – S Corporation of Partnership

TCJA logo
  Business owners may have questions about which flow-through entity might be right for them after the Tax Cuts and Jobs Act. Internal revenue Code (IRC) Section 199A provides a deduction for individuals and trusts on combined qualified business income (QBI).  This provision is effective December 31, 2017, through December 31, 2025, and it applies to sole proprietorships, disregarded entities, partnerships (LLCs taxed as partnerships), and S Corporations. QBI is ordinary income less ordinary deductions…
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16 April By Webmaster | mendasweed

Repeal of State and Local Income Tax (SALT) Deduction

68029524 - us 1040 tax form with pen, and coins
  By now, you have probably heard that the 2017 Tax Cuts and Jobs Act has limited the deduction for state and local income tax (SALT) to $10,000 for all tax filers, including tax filers who file their tax returns as married filing jointly.  If you are a California resident, this may be very concerning for you. The good news is that this change is set to automatically  expire after December 31, 2025.  The bad…
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9 April By Christina Weed | mendasweed

Estate Planning After the Tax Cuts and Jobs Act

family in estate planning session
  The new tax laws increased the estate, gift, and generation-skipping transfer (GST) exemptions to $11.2 million in 2018.  The annual gift exclusion has been increased to $15,000 in 2018. It is still very important to plan even with the new tax laws.  The tax laws related to estate planning automatically expire after 2025.  Also, many states have estate taxes as well.  While California currently does not have an estate or inheritance tax, that could…
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31 January By Christina Weed | mendasweed

[Video] Tax Changes for 2018

https://youtu.be/2TE1RvU4TQg As you may be aware, there will be some drastic tax changes that will go into effect in 2018.  Many clients want to know how this will affect them. Please consider the following changes: There will still be 7 income tax brackets for individuals, but the rates are all slightly lower for the most part.  The standard deduction will double, and the personal exemption will be eliminated. Many itemized deductions will be eliminated. Alimony…
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28 January By Christina Weed | mendasweed

California Democrats Propose New Work-Arounds to Help Ease the Tax Burden Imposed By Trump’s New Tax Law

Democrats are proposing a work around for the tax cap recently imposed.
  The new tax bill, which was signed into law on December 22, 2017 by President Trump, leaves many taxpayers uncertain about how this law may affect their tax and income status. Of primary concern in California and other high-tax, high-cost states is the $10,000 limit on deductions for state, local, and property taxes. Data from the Department of Finance stated the average state and local deductions for Californians in 2015 was over $18,400. The…
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16 January By Christina Weed | mendasweed

Income Tax Tips for the 2017 Tax Season

January is a traditional starting point for a bold new year and for many income tax payers, the perfect time to start preparing their documents for 2017 Income Tax filings. Having a list of Income Tax Tips may help you avoid some of the pitfalls that can occur by even the most well-intentioned tax preparer as well as ease the process. Consider these tax tips when preparing your 2017 Income Taxes. Make sure to report…
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