Archive for the ‘Income Tax: Tax Cuts and Jobs Act’ category

Seminar: How Resilient is Your Estate Plan? Will Your Plan Work as Things Change?

October 8, 2019

Estate Planning Seminar!

October 17, 2019

We invite you to a free seminar on October 17, 2019, at the Ethan Allen Hotel in Danbury, Connecticut (21 Lake Avenue Ext).

Topic: How Resilient is Your Estate Plan?

The presentation will start at 6:30 PM.

To register, call 203-744-1929 (please provide your email address) or email us at dvv@danburylaw.com.  You also can register here: Seminar Registration.

Informative and fun. Come learn and have a great time.

We intend to cover changes of all kinds (not just law and taxes) that will most affect your estate plan.

Reconnect with all the attorneys in our estate planning and probate practice group.

Topics include:

  • Probate Courts
  • Issues related to Change of Residence
  • Coping with the Surge of Conservatorship Proceedings
  • How Estate Planning Changes with Each Stage of Life
  • Changes in Law that Could Affect Your Estate Plan.

The presentation will start at 6:30 PM. Light refreshments will be served.

To register, click below or call us at 203-744-1929 or email us at
dvv@danburylaw.com.

REGISTER HERE


The Presenters and Their Topics:

Richard L. Emerson

Topic: Insights from a Former Probate Judge

The Probate Courts have been affected by important changes. Attorney Richard L. Emerson will inform us about the workings of the Probate Courts as only a former Probate Court Judge can.

Attorney Richard L. Emerson served as the Probate Judge in Redding, Connecticut, for over thirty years. His legal practice concentrates on estate administration, probate, estate planning, trust and estate disputes and general corporate representation. He also has mediated contested probate matters and has appeared as an expert witness for other attorneys.

James J. Flaherty, Jr.

Topic: Thinking About Moving Out of Connecticut? Consider
This.

We often hear about people moving out of Connecticut. Is this merely a case of “the grass is always greener…”? James J. Flaherty, Jr., will discuss issues related to a change of residence. Whether you stay or go, if you are wondering about leaving, this is information you need.

Attorney James J. Flaherty, Jr., practices from the firm’s Southbury office and is a member of the estate planning and probate group. Jim’s practice focuses on assisting high net worth individuals, including closely held business owners, in the creation of wealth succession plans. In addition to estate planning, Jim works with individuals on Medicaid (Title 19) and asset protection planning.

Alyson R. Marcucio

Topic: Coping with the Surge in Conservatorship
Proceedings

The increasing number of conservatorship proceedings creates additional demands on our Probate Courts. Alyson R. Marcucio will discuss planning steps to work around crowded court dockets and long wait times.

Attorney Alyson Marcucio is a member of the firm’s estate planning and probate group, with an emphasis on elder law and
planning for those who have chronic disabilities. Alyson’s practice includes long term care, incapacity and special needs planning, eligibility for Medicaid and other public benefits, and conservatorship proceedings.

 

Elizabeth J. Hartery

Topic: Estate Planning for Each of Life’s Stages

Life is often thought of as having twelve stages. Estate planning starts with the sixth stage and ends with the twelfth: late adolescence; early adulthood; midlife; mature adulthood; late adulthood; and death and dying. Liz Hartery will discuss how the planning focus changes as we pass through each stage.

Attorney Elizabeth J. Hartery is an associate in the firm’s estate planning and probate group, assisting with estate planning, estate settlement, probate matters, and elder law issues.

 

Richard S. Land

Master of Ceremonies

Attorney Richard S. Land heads up the firm’s estate planning and probate group, helping individuals from all walks of life to manage and dispose of their assets in an orderly fashion through lifetime transfers and through transfers at death by wills and trusts.

Richard has authored and produced dozens of educational videos on estate planning and trust and estates topics, authored several computer generated estate planning document assembly systems and authored an online estate plan review program.

No Admission Charge

Our seminars are always strictly educational and well attended.  Space is limited so please let us know if you plan to attend.

Light snacks, desserts and beverages will be offered.

To register, click on this link: Seminar Registration.

Please join us at the Ethan Allen Hotel (21 Lake Avenue Ext., Danbury, CT) on October 17, 2019.

We look forward to seeing you.

Chipman Mazzucco Emerson LLC
Attorneys at Law
44 Old Ridgebury Road
Suite 320
Danbury, CT 06810
203-744-1929

 

Is Rental Property Income Eligible for the Pass Through Income Deduction?

February 24, 2019

On January 18, 2019, final regulations and a special notice were published regarding the 20% income tax deduction related to certain pass through income. 

Trade or Business?

The Notice (Notice 2019-07) offers owners of rental real estate an opportunity to benefit from significant deductions related to rental income.  This blog discusses the content of the Notice.

As an appendix to previously posted videos on the pass through income deduction, we posted a video regarding the Notice: 

For the other videos on the pass through deduction, click on this link:  Pass Through Deductions and Other Tax Cuts and Jobs Act Subjects

This blog is to discuss the Notice 2019-07 in more detail. 

It’s not always easy to determine whether your rental real estate activity satisfies the somewhat vague definition of a trade or business so the IRS tried to provide a bright line test (call it a “safe harbor”) for determining whether the deduction will be available to you for the rental income you receive.

The safe harbor is described in Notice 2019-07 in the form of a Proposed Revenue Procedure.  If your rental activity income satisfies the criteria described in the Notice, you can be confident that your rental activity income will qualify for the 20% pass through income deduction under section 199A of the Internal Revenue Code.

The safer harbor provisions apply only to Rental Real Estate Enterprises.  A Rental Real Estate Enterprise is an interest, or multiple interests, in real estate held directly by an individual or Relevant Pass Through Entity (aka “RPE” such as a limited liability company, S corporation or partnership), for the production of rents but the definition excludes triple net leases and interests used to any extent as a personal residence.  Commercial and residential real estate cannot be part of the same Rental Real Estate Enterprise.

For purposes of the 20% deduction that applies to pass through income under Section 199A of the IRC, your Rental Real Estate Enterprise will be deemed a trade or business if certain requirements described in the Notice are satisfied.  Keep in mind that only certain income of a trade or business can qualify for the deduction so this is a key point for income earned through your rental activities.

The Notice says that your rental activity will be treated as a trade or business if (i) you maintain separate books and records for each rental real estate enterprise; (ii) you or your agents devote 250 or more hours per year to rental services with respect to the rental real estate enterprise; and (iii) you keep contemporaneous records related to the rental services. 

The records must include: (i) the hours performed, (ii) a description of the services performed, (iii) dates on which the services were performed, and (iv) who performed the services. 

The requirement that the records must be contemporaneous has been waived for 2018 so, if you do not have good records for 2018, you can try to do the best you can to reconstruct how you performed rental services in 2018.

Some things you do will count as rental services and some things will not.  The Notice includes a specific list of activities that count as rental services.  Here is the list:

  • Advertising to rent or lease property;
  • Negotiating and executing leases;
  • Verifying information in the applications of prospective tenants;
  • Daily operations, maintenance and repairs;
  • Management of real estate;
  • Purchasing materials; and
  • Supervision of employees and independent contractors.

Keep in mind that you will get credit for the time put in by your employees, agents and independent contractors so, if you have others doing the work for you, you should insist that they keep contemporaneous records of the work they do.

Also keep in mind that some of the time devoted to your rental activity will not count as rental services.  The time you or your agents spend traveling from property to property will not count.  Also, time devoted to financial and investment management relating to your real estate rental activities will not count.  Accordingly, the time you spend arranging financing, acquiring property, studying or reviewing financial statements or reports regarding your properties, or planning, managing, or constructing long term capital improvements will not count.

To claim the benefits of the safe harbor, you must file a statement indicating that all the requirements of the Notice have been satisfied. The statement must be signed by the taxpayer or authorized representative and include the following:

“Under penalties of perjury, I (we) declare that I (we) have examined the statement, and, to the best of my (our) knowledge and belief, the statement contains all the relevant facts relating to the revenue procedure, and such facts are true, correct, and complete.”

We are currently working on Section 2 of Part 3 of our video which will cover:

  • Planning to avoid the phase-out zone;
  • Additional planning to maximize pass-through income deductions based on wages and capital expenditures;
  • How transferring business interests to family members and trusts can create additional pass through income deductions; and
  • How converting pass through income to wages can increase pass through deductions.

You can access our playlist of previously posted videos by clicking on this link: Pass Through Deductions and Other Tax Cuts and Jobs Act Subjects.

To subscribe to the YouTube channel click here:  YouTube Channel.

Posted by Richard S. Land on February 24, 2019.

Chipman Mazzucco Emerson
Attorneys at Law

We frequently post articles relating to estate planning, estate settlement and elder law issues to this blog. We also post notices about our client seminars here. When we do, we send out notices to clients and friends of the firm. If you would like to get our notices, please join our mailing list by clicking below.

 
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Estate Planning for Beginners; Elder Law in a Nutshell; How to Make Certain Your Estate Plan Works as Everything Else Changes

September 30, 2018

FREE Estate Planning Seminar!

October 25, 2018

We invite you to a free seminar on October 25, 2018, at the Ethan Allen Hotel in Danbury, Connecticut (21 Lake Avenue Ext).

Topics: Estate Planning for Beginners and Elder Law in a Nutshell

Including: How to Make Certain Your Estate Plan Works as Everything Else Changes (including Trump Tax Changes)

The presentation will start at 6:30 PM. For more information, click here:  Seminar October 25.

To register, call 203-744-1929 (please provide your email address) or email us at dvv@danburylaw.com.  You also can register here: Seminar Registration.

The presenters and their topics:

Make Certain Your Estate Plan Works as Everything Else Changes

As everything around you changes, you may not recognize the impact the changes have on your estate plan.

Laws change; your health and financial condition change; the health and financial condition of your beneficiaries change; maybe your beneficiary designations change as your assets change; and the fates of the people you are depending on to act as your Executors, Trustees, agents under a power of attorney and health care representatives change.

Attorney Richard S. Land will discuss how to make certain that such changes will not interfere with, or totally disrupt, your estate plan.

Elder Law in a Nutshell

Alyson's Favorite Photo

What is Elder Law and how can an Elder Law attorney help you through the complex issues associated with aging?

The special needs of the elderly are not unique to the elderly, however. Persons of all ages may suffer from chronic conditions resulting in special needs requiring specialized legal help.

Attorney Alyson Marcucio will cover legal issues and solutions related to the special needs of the elderly and all others with special needs.

Estate Planning for Beginners: Features of Wills, Trusts and Powers of Attorney

 

What is the difference between a will and a revocable trust? What are the powers in a Power of Attorney? Do I even need an estate plan?

Attorney Elizabeth J. Hartery will answer those questions and many others in her presentation, which will explain the basic features of wills, trusts, Powers of Attorney, living wills and more.

 

No Admission Charge

Our seminars are always strictly educational and well attended.  Space is limited so please let us know if you plan to attend.

Light snacks, desserts and beverages will be offered.

To register, click on this link: Seminar Registration.

Please join us at the Ethan Allen Hotel (21 Lake Avenue Ext., Danbury, CT) on October 25, 2018.

We look forward to seeing you.

Chipman Mazzucco
Attorneys at Law
44 Old Ridgebury Road
Suite 320
Danbury, CT 06810
203-744-1929

 

Video: Pass Through Deductions and Other Tax Cuts and Jobs Act Subjects

April 29, 2018

On April 28, 2018, we posted to YouTube our video entitled “Pass Through Deductions and Other Tax Cuts and Jobs Act Subjects”.

Part I describes how the Tax Cuts and Jobs Act changes the most widely used income tax deductions related to state and local taxes, mortgage interest deductions and personal exemptions.  It also covers how the increased standard deduction and lower rates may make up for lost deductions.

Part II explains the income tax deduction available under Internal Revenue Code Section 199A for individuals who receive “pass through income” (aka trades or businesses that generate self-employment income”).

We hope these videos are helpful.  Please let us know if you have any questions.

Posted by Richard S. Land on April 29, 2018

Chipman Mazzucco
Attorneys at Law


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