2018 Tax Changes Affecting Business Owners

How Will 2018 Tax Changes Impact Small Business Owners?

With the passing of the Tax Cuts and Jobs Act in December 2017 came several new tax changes affecting business owners. The changes will take effect beginning this upcoming tax season for 2018 tax returns. Understanding all these changes and filing your return on top of successfully running your business, though, is a major feat.

Lynda’s Tax and Bookkeeping Services can make the process go smoothly and help answer any questions about how the 2018 tax changes will affect business owners. We offer tax accounting for small businesses and small business tax preparation in Ocean City, MD and surrounding areas. Let us help you sift through tax questions regarding 2018 tax policies and receive the best tax deductions with these reforms.

For more information about some of the tax updates, keep reading below or contact us to speak with a small business accountant.

Section 199A Tax Information (20% Tax Deduction)
One of the biggest tax updates for businesses from the Tax Cuts and Jobs Act was Section 199A.
This section of the bill is geared specifically towards small businesses that are pass-through entities, or companies whose profits are taxed through the business owner’s individual tax return. Such pass-through entities may be S-corps, LLCs, sole proprietorships or partnerships.

That income that is taxed through a personal tax return will still pass through at the appropriate individual tax rates just as before. Only now, these individuals who own the business can get a 20-percent tax deduction on that qualified business income, just having to pay taxes on the other 80%.

When filing your tax return, you will first need to determine how much of your incomes, gains and losses can be included in your qualified business income. The 20-percent tax break for small businesses may also be limited to you depending on your taxable income, your business industry and other factors. But Lynda’s Tax and Bookkeeping Services is here to help you sort through all of that!

Find more policy information on tax outlined in 199A, the 20% tax credit for small businesses and other tax reforms that affect business owners at irs.gov. Call us at Lynda’s Tax and Bookkeeping Services with any tax questions you have. Begin your small business tax return or learn more about our small business accounting services for helping your through 2018 tax changes!