Weekly Tax Tidbits

Weekly Tax Tidbits – tips, reminders, news and more!

Weekly tips curated by our experienced tax team to help you throughout the year – deadline reminders, ways to save on your taxes, news from the IRS, and more!

Be sure to reach out to our tax team with any questions regarding the information below.

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11-8-22: If you did a 1031 exchange, you must include a completed Form 8824 with your return.

11-1-22: Grandparents, foster parents or people caring for siblings or other relatives should check their eligibility to receive the 2021 child tax credit.

10-24-22: Early withdrawals from your retirement savings can result in heavy penalties and costly tax consequences.

10-18-22: For the 2022 Tax year, the inflation adjusted Section 179 deduction limit for businesses is $1.08M.

10-11-22: Cryptocurrency: Let your CPA know if you purchased, bought, or sold any form of cryptocurrency during the year. There may be a reporting obligation. Note: this includes if you purchased one cryptocurrency using another form of cryptocurrency.

10-4-22: When doing a 1031 exchange, don’t forget to do a cost segregation on the new property. Your tax advisor can help.

9-27-2022: A 1031 exchange only applies to business or investment property. It cannot be used for personal property, such as a primray residence, second home, or vacation home.

9-20-22: 180 Days – the number of days from the date you sell your property to complete a 1031 Exchange.

9-13-2022: 45 Days – the number of days from the date you sell a property to identify a replacement property for a 1031 Exchange.

9-6-2022: A 1031 Exchange allows you to avoid paying capital gains taxes when you sell an investment property and reinvest the proceds from the sale in a property or properties of like kind and equal or greater value.

8-30-22: HSA Contributions: The IRS 2022 Tax Year Inflations Adjustments increased the limites on Health Savings Account contributions to: $3,650 for self-only; $7,300 for family.

8-23-22: 2022 3rd quarter estimated tax payments are due: September 15, 2022.

8-16-22: Federal Student Loan payments are scheduled to restart on September 1st.
EDIT: The Student Loan Payment Pause was subsequently extended through December 21, 2022.

8-9-22: The ‘above-the-line’ deduction for charitable contributions expired at the end of 2021. If you claim the standard deduction in 2022 or later, there is no federal benefit for charitable contributions.

8-2-22: The Standard Deduction for the 2022 tax year, after IRS adjustments for inflations, are:

• Married, Filing Jointly – $25,900
• Single – $12,950
• Head of Household – $19,400

7-26-22: In a big change from 2021, the Child Tax Credit in 2022 drops back down to $2,000 per child and there will be no monthly advance payments.

7-19-22: The 2022 standard mileage rate for businesses increased from 56 cents to 58.5 cents from 1/1/22 through 6/30/22. In response to inflation, the IRS further increased it to 62.5 cents per mile for the remainder of 2022, from 7/1/22 through 12/31/22.

7-12-22: In 2022, the estate tax exemption is $12.06M. As a reminder, the exemption drops to $5.49M after December 31, 2025. Start gift and estate tax planning before it sunsets!

7-5-22: For certain taxpayers, Section 163j only allows a deduction for business interest expense to the extent it exceeds business interest income plus 30% of EBITA. In 2022, this is changed to EBIT.

6-28-22: 100% bonus depreciation starts to phase out beginning in 2023. The rate drops to 80% in 2023; 60% in 2024; 40% in 2025; 20% in 2026; and 0% in 2027 and later.

6-21-22: If you take money out of an HSA (Health Savings Account) for eligible medical expenses OR any other reason, be sure to send your 1099-SA to your tax preparer at year end.

6-14-22: The cost of day camp counts as an expense towards the Child and Dependent Care Credit.

6-7-22: Reminder: 2022 second quarter estimated tax payments are due June 15, 2022.

5-31-22: After missing last week’s deadline, Minnesota lawmakers will need to reconvene for a special session to finish work on a package of tax cuts and spending bills to impact residents this year. We are closely monitoring the pending tax legislation.

5-24-22: Self-employed individuals may make tax-deferred SEP, 401(k), and other retirement contributions until the business’ tax-filing deadline, including any extensions.

5-17-22: Did you recently buy or sell a home? Be sure to send your accountant copies of the original purchase agreement, sale agreement, and new purchase agreement.

5-10-22: The annual gift tax exclusion increased in 2022 from $15,000 to $16,000. Persons who gift $16,000 or less to any one person are not required to report the gift or gifts to the IRS.

5-3-22: The CARES Act changed QIP (qualified improvement property) to 15-year property (from 39-year), making such property eligible for bonus depreciation.

4-26-22: As part of the Consolidated Appropriations Act, business meals are 100% tax deductible if purchased from a restaurant in 2021 and 2022.

4-19-22: Student loan payments were scheduled to restart May 1, 2022, but on Apr. 6, the pause was extended again through Aug. 31, 2022. The temporary federal student loan relief suspends loan payments, sets interest rates to 0%, and halts collections on defaulted loans.

4-12-22: Reminder: An extension to file is not an extension to pay.

4-5-22: Share a copy of any letters your receive from the IRS with your tax preparer. This year, many taxpayers received IRS Letter 6419, which provides the total of advanced child tax credit payments received in 2021; and/or IRS Letter 6475, which includes the amount of 2021 Economic Impact Payment.

3-28-22: The filing deadline to submit 2021 tax returns or an extension to file and pay tax owed is Monday, April 18, 2022, for most taxpayers. Taxpayers requesting an extension will have until Monday, October 17, 2022, to file.

3-22-22: Reminder: 2022 first quarter estimated tax payments are due April 18th.

3-15-22: Return your e-file authorization (Form 8879) to your accountant as soon as you can to allow them to file your return promptly. If you have a payment due, you can wait until the deadline to pay.

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