Tax & Accounting Insights for Irvine, CA. Expert Guidance from Bharmal CPAs
Vacation Home: Seven Day Rental Rule
If you own a condominium, cottage, cabin, lake or beach home, ski lodge, or similar property that you rent for an “average” rental period of seven days or less for the year, you have a property with unique tax attributes. Seven days example. Say you have a beach home and you rent it 15 times during the year, for a [...]
Keep Track of Your Odometer to Claim Business Mileage
Do you claim your business miles at the IRS optional rate? If so, imagine you are now being audited by the IRS for your business mileage. The IRS has requested odometer readings for your vehicle. You might wonder if the IRS can do this. The answer is yes. The tax code says that you must substantiate your business vehicle deductions [...]
Go to EFTPS to Check if the IRS Received Your Money
Is your last payment of payroll taxes in the hands of the IRS or in the hands of an embezzler? How would you know? There’s one easy way to know: simply use the IRS’s online service to check. But that’s a bit of trouble, so why bother? Because if the money has been stolen, you (1) are out the original [...]
Common S Corp Health Insurance Deduction Mistake
If you own more than 2 percent of an S corporation, you have to do three things to claim a deduction for your health insurance: 1. You must get the cost of the insurance on the S corporation’s books. 2. Your S corporation must include the health insurance premiums on your W-2 form. 3. You must (if eligible) claim the [...]
How to Handle Multiple Rental Real Estate Under the New Tax Law
There’s a lot of confusion out there around your rental activity and Section 199A. Your Section 199A considerations multiply when you have multiple rental activities. Here’s what you need to consider: Are your rental activities multiple trades or businesses, or one trade or business? Can you aggregate the rentals for Section 199A purposes? Do you want to? How does the [...]
The Backdoor ROTH Strategy You Should Know
As you likely know, the Roth IRA is a terrific way to grow your wealth with a minimum tax downside because you pay the taxes up front and then, with the proper holding period, pay no taxes after that. But if you earn too much, you’re completely barred from contributing to a Roth IRA unless you can use the backdoor [...]