Getting the most of this course
Section 1: Definitions
Basic definitions commonly used in tax planning
Section 2: Tax Law Changes
Discussion of some of the 2018 tax law changes
- Tax law changes excel template
- Personal Standard Deduction
- Tax Rate Changes – Individual
- Tax Rates – Corporation
- Moving expenses
- Medical expenses
- Mortgage interest
- State taxes
- Casualty loss
- Miscellaneous itemized deduction
- Child tax credit
- Opportunity Zones
- Employee credit for paid family and medical leave
- Tax Law Change Quiz
Section 3: Qualified Business Income Deduction
QBI- new deduction for 2018
Section 4: Tax Planning
Section 5: Tax issues specific to married entrepreneurs
Section 6: Multi year tax planning issues
Opportunity Zones are designed to spur economic development and job creation in distressed communities. A temporary deferral of capital gains invested in an Opportunity Zone is offered as a tax benefit to investors.
The deferred gain must be recognized the earlier of the date the opportunity zone investment is sold or December 31, 2026
Example: Assume you are looking to sell one of your investments, if you sold now you will have to pay taxes on the gain unless you invested in an opportunity zone.
The opportunity zone tax benefit has 3 parts :
1) Deferment on gains for monies invested in opportunity zone
2) Exclusion of 10% of the deferred gain if kept for 5 years. The exclusion goes up to 15% if kept for 7 years
3) Increase in the basis of the opportunity zone investment (up to fair market value). In other words no gain is recognized on the sale of the qualified zone investment
How to invest in a qualified opportunity zone
1) Participate in a qualified opportunity fund – a fund that pools money from multiple investors to invest in opportunity zones
2) Invest in one of the zones listed in the excel file below.
- You do not have to live in the same zone you invest in
- Before investing in an opportunity zone you must self certify.
- You do this by completing a form and attach it to your timely filed federal income tax return.
Download the excel file to perform a simple test and see the list of qualified zones.
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