Tax office best providers in Houston, TX? If you have business income and expenses to report on Schedule C, you will need to share your books and records (for example, QuickBooks or any other accounting system you use, receipts for expenses, and relevant bank and credit card statements).16? The better organized your records are, the less time it will take a preparer to process your taxes, which translates into lower fees for their service.

If you own a business, restructure your business entity, particularly if you are operating as a sole proprietor, LLC, or an S-Corp. The taxes for a C-Corp are lower at the top than for other business structures. However, there’s also a new 20% deduction of business income for pass-through entities. And, if you hire your children, you can pay them without withholding or matching payroll taxes if you have a sole proprietorship. You should work with an accountant to determine if restructuring your business is worthwhile. Invest in tax-exempt bonds. Any interest you earn is not subject to federal income tax and from Medicare surtax calculations. Also, municipal bond interest for bonds purchased in the state where you live is exempt from state income taxes, too.

The Tax Cuts and Jobs Act (TCJA) created the Qualified Business Income (QBI) deduction when the law went into effect in 2018. You might be able to deduct 20% from your qualifying business income if your business is a pass-through entity—a sole proprietorship, an S corporation, or a partnership, passing its income and deductions down to its shareholders, partners, or owners to report on their personal returns. This deduction is in addition to claiming your ordinary business expense deductions. You should qualify if your taxable income is below $157,500, or $315,000 if you’re married and filing a joint return. Special rules apply if you earn more than these amounts, so you might still qualify depending on the nature of your business. Find even more info on https://greentree.tax/tax-preparation-service-in-houston/.

Sec. 1031 Exchange Rules. The only way you can avoid current tax when you sell investment property is through a “1031 exchange”, where you involve a third party, called an accommodator, to hold the money and buy a new property for you. But there are some rules you have to comply with: You can’t touch the money. You have to identify the new like-kind real property within 45 days after property being given up is transferred and close within 180 days. The new property has to cost at least as much as the old one. You can’t be relieved of debt (so you can’t use the proceeds from the sale to buy a new property for all cash if the old property had debt tied to it). You will pay hefty fees to the accommodator to handle all this for you.