The CPA Tax Solution

09/28/2025

In some cases you may file a free tax return

Prepare and file your federal income tax return online for free. File at an IRS partner site with the IRS Free File Program or use Free File Fillable Forms. It's safe, easy and no cost to you.

05/29/2025

Helpful read

Tax Tip 2025-06, Jan. 17, 2025 — Taxpayers should be aware of gift card scams and take steps to protect themselves. Scammers may target taxpayers by asking them to pay a fake tax bill with gift cards. People should remember that the IRS never asks for or accepts gift cards as payment for a tax bil...

02/26/2025

Good Read

01/24/2025

https://www.irs.gov/e-file-providers/free-file-fillable-forms-program-limitations-and-available-forms

Review a list of current tax year Free File Fillable Forms and their limitations.

12/10/2024

Get step-by-step guidance and resources to help you file a timely, accurate federal income tax return.

12/06/2024

Preliminary Injunction Blocking the Treasury Department from Implementing Reporting Requirements under the CTA

On Tuesday, December 3rd, a Texas federal court granted a nationwide preliminary injunction blocking the Treasury Department from implementing reporting requirements under the CTA. Based upon this injunction, we are recommending that you not file a BOI report at this time.

If the CTA is found unconstitutional, the court will permanently enjoin the Treasury from using the BOI information and will require it to purge its files of any information provided.

01/17/2024

The Advantages of LLC Structure for a Small Business

If you operate your small business as a sole proprietorship, you may have thought about forming a limited liability company (LLC) to protect your assets. Or maybe you're launching a new business and want to know the options for setting it up. Here are the basics of operating as an LLC and why it might be a good choice for your business.

An LLC is a bit of a hybrid entity because it can be structured to resemble a corporation for owner liability purposes and a partnership for federal tax purposes. This duality may provide owners with the best of both worlds.
Protect Your Personal Assets

Like the shareholders of a corporation, the owners of an LLC (called "members" rather than "shareholders" or "partners") generally aren't liable for the debts of the business except to the extent of their investment. Thus, the owners can operate the business with the security of knowing that their personal assets are generally protected from the entity's creditors.

This protection is much greater than that afforded by partnerships. In a partnership, the general partners are personally liable for the debts of the business. Even limited partners, if they actively participate in managing their businesses, can have personal liability.
Enjoy Partnership Tax Benefits

The owners of an LLC can elect under the "check-the-box" rules to have the entity treated as a partnership for federal tax purposes. This can provide a number of benefits to owners. For example, partnership earnings aren't subject to an entity-level tax. Instead, they flow through to the owners, are reported on the owners' individual returns and are taxed only once.

To the extent the income passed through to you is qualified business income (QBI), you'll be eligible to take the Section 199A QBI deduction, subject to various limitations. However, keep in mind that this deduction is temporary. It's available only through 2025, unless Congress acts to extend it.

In addition, because you're actively managing the business, you can deduct on your individual tax return your ratable shares of any losses the business generates. This, in effect, allows you to shelter other income that you (and your spouse, if you're married) may have. (Limits on the business loss deduction do apply.)

An LLC that's taxable as a partnership also can provide special allocations of tax benefits to specific partners. This can be a notable reason for using an LLC over an S corporation (a business structure that provides pass-through tax treatment similar to a partnership). Another reason for using an LLC rather than an S corporation is that LLCs aren't subject to the restrictions the federal tax code imposes on S corporations regarding the number of owners and the types of ownership interests that may be issued.
Consider All Angles

An LLC can give you corporate-like protection from creditors while providing the benefits of taxation as a partnership. For these reasons, you may want to consider operating your business as an LLC.

01/17/2024

Sec. 179 and Bonus Depreciation 101

Section 179 expensing may allow you to currently deduct the full cost of purchasing eligible new or used assets, such as equipment, furniture, off-the-shelf computer software, and qualified improvement property (QIP). An annual expensing limit applies ($1.16 million for 2023 and $1.22 million for 2024), which begins to phase out dollar for dollar when asset acquisitions for the year exceed the applicable threshold ($2.89 million for 2023 and $3.05 million for 2024). You can claim the election only to offset net income, not to reduce it below zero to create a net operating loss.

First-year bonus depreciation is available for qualified assets, which include new tangible property with a recovery period of 20 years or less (such as office furniture and equipment), off-the-shelf computer software and water utility property. Under the TCJA, through 2026, the definition has been expanded to include used property and qualified film, television and live theatrical productions. In addition, QIP is now eligible for bonus depreciation. For 2023, bonus depreciation was 80%. It drops to 60% for 2024, to 40% for 2025 and to 20% for 2026. After that, it will be eliminated, unless Congress acts to extend it.
When to Consider Forgoing These Breaks

Here are two examples when it may be preferable to forgo Sec. 179 expensing and bonus depreciation:

You're planning to sell QIP. If you claim Sec. 179 expense or bonus depreciation on QIP and sell the building soon, this current write-off may be a tax trap. That's because your gain on the sale up to the amount of Sec. 179 or bonus depreciation deductions you've claimed will be treated as “recaptured” depreciation that's taxable at ordinary-income tax rates, up to 37%. But if you deduct the cost of QIP under regular depreciation rules (generally, over 15 years) and sell the building, any long-term gain attributable to the deductions will be taxable at a top rate of 25%.

You're eligible for the qualified business income (QBI) deduction. This deduction allows eligible business owners to deduct up to 20% of their QBI from certain pass-through entities, such as partnerships, limited liability companies and sole proprietorships. The deduction can't exceed 20% of an owner's taxable income, excluding net capital gains. (Other restrictions apply.)

Claiming Sec. 179 or bonus depreciation deductions reduces your taxable income, which may deprive you of an opportunity to maximize the QBI deduction. Because the QBI deduction is scheduled to expire after 2025, taking full advantage of it while you can will generally make sense.

Timing Is Everything

Keep in mind that only the timing of deductions is affected by the strategy you choose. You'll still have an opportunity to write off the full cost of eligible assets if you forgo Sec. 179 expensing and bonus depreciation; it will just be over a longer time period.

01/17/2024

https://www.irs.gov/newsroom/irs-reminder-jan-31-filing-deadline-for-employers-to-file-wage-statements-independent-contractor-forms

IR-2024-06, Jan. 9, 2024 — With tax season rapidly approaching, the IRS reminds employers that Jan. 31 is the deadline for submitting wage statements and forms for independent contractors with the government.

01/17/2024

https://www.irs.gov/newsroom/treasury-and-irs-announce-that-businesses-do-not-have-to-report-certain-transactions-involving-digital-assets-until-regulations-are-issued

IR-2024-12, Jan. 16, 2024 — The Treasury Department and Internal Revenue Service today issued an announcement informing businesses that they do not have to report the receipt of digital assets the same way as they must report the receipt of cash until Treasury and IRS issue regulations.