TAX REFORM: Are You Asking the Right Questions for Your Business?

November 1, 2018 – The Tax Cuts and Jobs Act (“TCJA”) results in significant modifications to the tax code that impact every business, regardless of size. Business owners and management teams need to gain an understanding of how these rules impact their businesses and ensure that they implement strategies that result in the best tax position for the Owners and Company.

Provided below are a few high-level questions that all business owners and management teams should be discussing with their trusted advisors:

What new rules within the TCJA will impact me and my business the most?

  • Enhanced depreciation
  • “Small business” exception
  • Business loss limitations
  • Pass-through deduction
  • Changes to credits
  • Interest limitations
  • Elimination of DPAD
  • Lower individual rates
  • Meals & entertainment
  • NOL limitations
  • Lower corporate rates
  • New foreign regime

Should I consider changing my business entity selection? Do I understand the implications?

  • Lower C-corporation tax rate
  • Elimination of C-corp AMT
  • Compensation restrictions
  • Pass-thru deduction
  • Distributions
  • Cost of changing
  • State tax deduction
  • Ownership restrictions
  • Stage of businesses’ life

What is the state impact of TCJA? What is the foreign impact?

  • Bonus depreciation
  • Pass-through deduction
  • Deemed repatriation
  • Section 179 election
  • NOL limitations
  • FDII, GILTI, and BEAT
  • Business interest
  • Entity selection impact
  • Dividend exclusions

Does TCJA impact my succession planning or exit strategy?

  • Current plan and timing
  • Enhanced estate exemption
  • Entity type

While there are still many uncertainties related to Tax Reform, it is imperative that businesses owners and management teams consider all the known implications, analyze the impact on their businesses, and start planning to take advantage of or minimize the impact of the new provisions contained within the Act.

 

This post is an excerpt from the Dopkins Risk Advisory Services newsletter. To read the complete publication, please click here.  

For more information, please contact Bob Bauer at rbauer@dopkins.com.

About the Author

Robert J. Bauer CPA

Bob, a Director in the Dopkins Tax Advisory Group, provides tax compliance, consulting and planning for businesses and individuals. He joined the Firm in 2014 with 20 years tax accounting and consulting experience split between public accounting firms and private industry.