Edit ModuleShow Tags

What you need to know about the new tax law

Some new deductions will be available, while others have been taken away.



 

Q: What do I need to know about the new tax rules?

 

A: Congress enacted the biggest tax reform law in 30 years, one that will make fundamental changes in the way you and your business calculate your federal income tax bill and the amount of federal tax you will pay. Since most of the changes will go into effect next year, there’s still a narrow window of time before your final filing for Tuesday, April 17. 

Tax software companies have been creating comparative models with the ability to project how the new rules will affect your 2018 tax return using 2017 data. I encourage you to get a final draft of your 2017 business and individual income tax returns prepared so you can use the information to enter into the 2018 tax projection software of your choice.

Here are some key points to discuss with your CPA:

The entertainment deduction: For decades, business owners have been able to deduct 50% of the cost of entertainment directly related to or associated with running their businesses. For example, if you took a client to a nightclub after a business meeting, you could deduct 50% of the cost as long as strict substantiation requirements were met. Under the new law, there is no deduction for such expenses. However, taxpayers are still generally able to deduct 50% of the food and beverage expenses associated with operating their trade or business (e.g., meals consumed by employees on work travel).

A new deduction for the self-employed: Self-employed taxpayers can deduct up to 20% of qualified business income from a sole proprietorship, partnership or S corporation. There are a few limitations placed on the deductions, so ask your CPA to help you better understand this new deduction by filing time. This is one deduction you will need guidance on, since it’s related to compensation paid to various employees in your organization.  

The new depreciation law: A 100% first-year deduction for the adjusted basis will be allowed for qualified property acquired and placed in service after Sept. 27, 2017. Alert your tax preparer of any assets you purchased during this time period in 2017. 

You should make every effort to prepare your taxes on time this year so you can take the data and model your 2018 estimated tax impact through software provided by your CPA. By being proactive, you’ll understand early in 2018 how the new tax laws will affect you.  

 

Edit Module

Tell us what you think at or email.

Edit Module
Edit ModuleShow Tags
Edit ModuleShow Tags

Related Articles

Product Spotlight - April 2019

PMQ brings you the brightest ideas around for April 2019

SmartMarket: 5 ways DoorDash drives sales to your business

Pizza Sports Make a Splash on ESPN3

As ESPN3 brings U.S. Pizza Team events to a national audience, pizza sports can raise your restaurant’s profile and help you boost your sales and profits.

Danger, Will Robinson? As Robotics Improve, How Will They Affect the Pizza Biz?

Food bots can already make pretty good pies. And as they get smarter and cheaper, they could reinvent the pizza business.

Chef's Corner: Anthony Spina-O4W Pizza

Inspired by his own grandmother, this New Jersey pizzaiolo has brought classic Grandma-style pies to the ATL.

How to Build a Private-Label Food Business

It all starts with a high-quality product and extensive market research, says Lenny Rago of Panino’s Pizza.

Pizza Sports are Here to Stay, and Competitors Are Set to Become Stars

Tips for gaining a competitive edge in this year's acrobatic events, broadcast on ESPN3!

How to Par-Bake Crusts in an Air Impingement Oven

Follow Tom Lehmann's five-step method to prevent the development of pita-like pockets in your crusts.

Tyson Smokehouse Pizza - Recipe of the Month

Bonici Mesquite Pepperoni and Bakin' Bacon top off this spicy pie from Tyson Foodservice.

Old Forge-Style Pizza is a Cut Above

As the self-proclaimed pizza capital of the world, Old Forge, Pennsylvania has a style—and a sense of community—that’s all its own.
Edit ModuleShow Tags
Edit ModuleShow Tags
Edit Module
Edit Module
Edit ModuleShow Tags
Edit ModuleShow Tags
Edit Module
Edit ModuleShow Tags
Edit ModuleShow Tags