— Steven M. Piascik, CPA, MT
Lately, it seems that Uncle Sam is making tax burdens all the more painful on American taxpayers. Congress continues threaten to eliminate popular deductions, as well as eliminate itemized claims for state and local sales taxes and private mortgage insurance payments.
Regardless of whether this happens, taxpayers should still take a look at their 2014 financial records, and make some important tax moves, before December 31st. Here are five that I recommend.
Protect Your Ass…ets. Are your assets exposed to potential risks that are around you every day? Are creditors likely to attach their alleged claims against you to your highly valued assets, or do you have personal lawsuits lingering? Never give up your assets. Protect them with legal agreements and make sure your beneficiaries are able to keep your hard earned life accomplishments, even after you are gone. This is so much easier than you think.
You can run, but you can’t hide! Do you have income and interests overseas? If you have assets or income held in foreign bank accounts, don’t even think that it can go unreported. The IRS is cracking down on taxpayers who have failed to report offshore income or assets, through the Offshore Voluntary Disclosure Program. Be sure you are filing the proper fBar forms for 2014, and if you have failed to report this income in prior years, consult a licensed CPA – before the IRS comes calling.
Sell it Abroad – and Defer! Do you own a business or company that exports products or services overseas? If so, up to 50% of your export income might qualify for either tax deferred, tax-reduced, or tax exempt status, through an Interest-Charge Domestic International Sales Corporation (IC-DISC).
Let Your Properties Work for You! Do you own rental properties and/or a beach home(s)—with a cost over $1 million? Consider a Cost Segregation Study, which identifies a property’s assets and costs, and classifying those assets for federal tax purposes, while accelerating the depreciation deductions today instead of tomorrow. The benefits of a cost segregation study will result in an immediate increase in cash flow, a reduction in current tax liability, a deferral of taxes, as well as the ability to reclaim “missed” depreciation deductions from prior years (without having to amend tax returns).
Let’s eat! If you frequently travel or conduct business over lunch, dinner or multiple events per year, a Meals & Entertainment Analysis (M&E) can increase your tax deductions by 50%. Stop losing the full value of these deductions and decrease your taxes today along with increasing your current cash flow.