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In order to take advantage of two important depreciation tax breaks for business assets, you must place the assets in service by the end of the tax year. So you still have time to act for 2016. Section 179 deduction The Sec. 179 deduction is valuable because it allows businesses to deduct as depreciation up to 100% of the cost of qualifying assets in year 1 instead of depreciating the...

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November 30, 2016

Donations to qualified charities are generally fully deductible, and they may be the easiest deductible expense to time to your tax advantage. After all, you control exactly when and how much you give. To ensure your donations will be deductible on your 2016 return, you must make them by year end to qualified charities. When’s the delivery date? To be deductible on your 2016 return, a charitable donation must be...

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November 30, 2016

When planning their estates, many people agonize over the negative impact their wealth might have on their children. To address these concerns, some people establish quiet trusts, also known as silent trusts. In other words, they leave significant sums in trust for their children; they just don’t tell them about it. An interesting approach, but is it effective? A questionable strategy Many states permit quiet trusts, but the risks associated...

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November 30, 2016

Taxpayers may challenge IRS expert’s valuation in gift tax case. The U.S. Court of Appeals for the First Circuit has reversed in part a Tax Court decision that “misstated” the burden of proof in a gift tax case and improperly refused to allow the taxpayers to challenge an IRS expert’s valuation report. The report had served as the basis of the taxpayers’ disputed tax liability. The appeals court found that...

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November 30, 2016

Tax deferral denied despite lack of prearranged plan for related-party transaction. Sec. 1031 allows capital gains to be deferred when a property is swapped for another property of a like kind, as long as various rules are met. The U.S. Tax Court ruled that a series of like-kind exchanges went against Sec. 1031 related-party rules even though the taxpayer hadn’t intended to involve a related party. The exchanges used a...

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November 30, 2016

Last minute tax-saving business tips. As year-end approaches, if you own a business you could benefit from some tax-trimming moves. Among them are making adjustments to income to preserve favorable estimated tax rules for 2017, deferring certain advance payments to next year, and fine-tuning bonuses to make the most of the domestic production activities deduction. Contact us for more details on these tips and other ways to help ensure you...

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November 30, 2016