Federal Tax Returns for 2019

Owners of pass-through entities (e.g. partnerships, S corporations, and sole proprietors) may be entitled to a section 199A deduction for qualified business income ("QBI"). Under section 199A, certain taxpayers may be entitled to a deduction up to 20% of QBI. While this deduction potentially creates a substantial tax benefit for owners, it's complicated. There are complex rules to determine qualification for the deduction. Moats & Hebebrand CPAs are here to help.

Foreign Bank Account Traps

If you have ANY bank account, retirement account, investment account/or business ownership interest with a value of $10,000 or more in a foreign country, you must advise your tax preparer since special rules now apply. Failure to disclose this on your tax return could result in severe penalties, as well as additional fees in representing you in any dispute with the Internal Revenue Service. The United States has negotiated agreements with foreign countries to require them to report foreign income to the United States to ensure U.S. citizens report and pay tax on foreign income.

Moving Expense Deduction

For the tax year 2019 there is no federal tax deduction for job related moving expenses. The moving expense deduction and the exclusion from income provision is allowed only to the members of the Armed Forces (or their spouse or dependents) on active duty that move pursuant to a military order or incident to a permanent change of station.

Pension Plan Deductions 2019

IRS contributions limits are: under the age of 50, $6,000, 50 and over, $7,000.

Elective Deferral Limits: Simple IRA Plan: under the age of 50, $13,000, 50 and over $16,000

401(k), 403(b) and 457 plans: under the age of 50 $19,000, 50 and over $25,000. Profit sharing plan and SEP: contribution limit $56, 000, compensation limit $280,000.

The office of Moats & Hebebrand CPAs makes a concerted effort to stay on top of the changes in the tax laws so you don't have to. Let us prepare your 2019 tax returns so you know they are done right! We are also open all year to assist with tax planning and to take care of our clients.