| Dale K. Cline, CPA, PLLC
CERTIFIED PUBLIC ACCOUNTANT
P.O. Box 3966
Suite 101, 1333 2nd St. N.E.
Hickory, NC 28603-3966
TAX INFORMATION FOR BUSINESSES
Healthcare reform, budget cuts, tax system overhaul, over - time regulations!! Where do we go from here and how soon will any of these items be in place? That is anyone's guess at this time but we will focus on what is for 2017 under current regulations.
BUSINESS EQUIPMENT: Maximum expensing amount (federal) for new or used assets in service under Code Sec. 179 is $510,000, ($2.030Mil. indexed investment limit) and permanent. You can claim first-year bonus depreciation equal to 50% of the cost of most new equipment placed in service; PATH enhanced first-year cap for autos and trucks through 2019. N.C. dollar and investment limit is $25,000 and $200,000 respectively, was made permanent and includes 85% addition adjustment in the first year and deductible at 20% over the next 5 years.
Fifteen (15) Year Write-off for Qualified Leasehold and Retail Improvements and Restaurant Property made permanent in PATH and places this property in the 15 Year MACRS class depreciation.
After 2015, PATH will provide that air conditioning and heating units are treated as eligible for expensing under Code Sec. 179.
HEALTH CARE REFORM LEGISLATION, Affordable Care Act (ACA) continues to be phased in through 2018 with major filing requirements for applicable employers.
APPLICABLE LARGE EMPLOYERS (ALEs) must furnish full-time employees and file copies of Forms 1095-C and 1094-C with IRS for 2015 forward. (ALE) is an employer that employed on average 50 or more employees (determined by adding together the number of full-time and the full-time equivalent employees) during each month of the "Testing Period".
ACA (Affordable Care Act) prohibits employers from subsidizing, reimbursing, or paying premiums for employees for individual market health insurance policies. The penalty for violating the market reform restrictions is critical.
REPEAL and REPLACE ACA is still underway.
WORK OPPORTUNITY, RESEARCH & EXPERIMENTATION TAX CREDITS were extended.
FAILURE to FILE timely LLC, Partnership or S-Corp. returns carries stiff penalties for partners (per partner, per month up to 12 months)
S-CORPORATION Owners' medical insurance premiums paid on behalf of the owners must be included on their W-2s to assure compliance as a deduction for adjusted gross income. ACA compliance required.
De Minimis "SAFE HARBOR" threshold for capitalizing tangible assets for taxpayers without an applicable financial statement is $2,500. These treasury regulations were established in 2014 and were intended to clarify whether certain types of expenditures should be expensed or, capitalized and depreciated.
CHARGING DEDUCTIBLE ITEMS on a credit card before your business year ends establishes the deduction even if you pay the bill the following year.
NORTH CAROLINA'S CORPORATE INCOME TAX RATE is 3% for 2017.
1099 Misc has to be given to recipients and sent to the IRS by January 31. Other 1099's should be sent by January 31 but may have a later submission date to IRS. Stiffer penalties apply for failure to file correct information returns.
STANDARD BUSINESS MILEAGE RATE for 2017 is $.535; medical & moving rate is $.17 for 2017 and charitable rate is $.14.
SOCIAL SECURITY WAGE BASE is $127,200 for 2017. Employers will pay up to $7,886.40 in social security tax for each employee and 1.45% medicare tax on all wages.
Please be aware that tax provisions continually change and you should seek professional guidance in applying any tax provision to a specific situation.
© 2010 Dale K. Cline, CPA, PLLC All Rights ReservedUpdated July 19, 2017