QTax, LLC

07/08/2026

07/01/2026

Tax Tip of the Week 4-34

Trump Accounts Update

Last week the IRS issued Revenue Procedure 2026-25, providing welcome guidance on one of the unanswered questions surrounding Trump Accounts.

If you're looking for a cure for insomnia, here is the Revenue Procedure:

https://www.irs.gov/pub/irs-drop/rp-26-25.pdf

For those who prefer the short version, here is the IRS news release:

Treasury, IRS provide safe harbor for certain contributions to Trump Accounts under the Working Families Tax Cuts

Before Revenue Procedure 2026-25, many tax professionals believed that contributions to a Trump Account could require the donor to file a Gift Tax Return (Form 709), even when no gift tax was actually owed.

Revenue Procedure 2026-25 establishes a gift tax reporting safe harbor. If the safe harbor requirements are met, qualifying contributions by individual donors will not require gift tax reporting on Form 709.

My two cents...

If you have a child born between January 1, 2025, and December 31, 2028, I think you should take a serious look at opening a Trump Account. Starting your child's future with a free $1,000 government contribution is a pretty good deal.

That said, Trump Accounts come with a number of rules governing eligibility, contributions, investments, and withdrawals. Before opening or contributing to one, you should consult both your Tax Pro and your Financial Advisor to determine whether it fits your family's financial goals.

Remember, we read and speak Tax, so you don't have to.

06/24/2026

Tax Tip of the Week 4-33

ABLE Savings Accounts – A Brief Overview

People with disabilities may be able to use an Achieving a Better Life Experience (ABLE) account to save for qualified disability expenses while preserving eligibility for certain public benefits.

ABLE accounts are savings accounts. Contributions are not deductible for federal income tax purposes, but qualified distributions are tax-free.

If properly structured, an ABLE account beneficiary may also qualify for the Saver's Credit on their own contributions if they:

Are at least age 18 by 12/31/2026.
Are not a dependent or a full-time student.
Meet the applicable income requirements.

You may also be able to roll over funds from a 529 education savings plan to an ABLE account for the same beneficiary (or an eligible family member), subject to the annual ABLE contribution limit ($20,000 for 2026).

A list of qualified disability expenses can be found in IRS Publication 907:
https://www.irs.gov/pub/irs-pdf/p907.pdf

ABLE accounts can be a great opportunity for individuals with disabilities to save for the future. While there is no federal lifetime limit on an ABLE account balance, each state sets its own maximum account value. In addition, individuals receiving SSI should be aware of the special $100,000 SSI resource rule.

All this is a way of saying that an ABLE account can be another useful tool in your financial planning toolbox. Because the rules contain a lot of important details, it's a good idea to consult both your Financial Advisor and your Tax Pro before making decisions.

We speak and read tax, so you don't have to.

06/18/2026

Tax Tip of the Week 4-32

Disaster Preparedness and Tax Records

It's that time of year again—hurricane season is officially underway, and we already have our first named storm, Arthur. I doubt he's as adorable as Dudley Moore's Arthur (and if you get that reference, congratulations on being of a certain age).

Mother Nature can be unpredictable, so now is a good time to make sure you have a disaster preparedness plan in place. The federal government offers excellent resources at Ready.gov.

Create electronic copies of important documents.

Keep both paper and electronic copies of important records in secure locations. We maintain paper and electronic copies of our important documents, store them in a fireproof safe, maintain off-site backups, and keep copies in the cloud.

Document your valuables.

Take photographs and/or videos of valuable possessions and store those images in a secure location. Having documentation before a disaster can make insurance claims and loss calculations much easier.

Contact your Tax Pro after a disaster.

If you are affected by a disaster, contact your tax professional as soon as practical to determine whether any federal or state disaster-related tax relief is available. Remember to be patient—if the disaster is widespread, your tax professional may be dealing with the same challenges as well..

Helpful Hint: If a fast-moving disaster is headed your way and evacuation is necessary, consider placing portable electronic media (such as USB drives and external hard drives) and copies of important documents inside an empty dishwasher. While a dishwasher is not guaranteed to be waterproof or fireproof, it may provide an additional layer of protection from water, debris, and heat. For best protection, keep important records backed up in multiple locations, including secure cloud storage and an off-site backup.

We speak Tax so you don't have to.

06/10/2026

Tax Tip of the Week 4-31

If you use a tax professional, make sure you are choosing the right one. How do you know?

*They are available after tax season.

*They do not base their fee on a percentage of your refund.

*They offer IRS, state, and local e-file where available.

*They ask for records, receipts, and supporting documents.

*You can verify their qualifications and understand what the initials after their name mean: https://irs.treasury.gov/rpo/rpo.jsf

*They encourage you to review your return before approving submission. Do not just look at the refund or balance due. Ask questions. A good tax professional should be willing and able to explain why items appear where they do. Also make sure your direct deposit or payment account information is correct.

Remember, we speak tax so you don’t have to.

06/04/2026

Tax Tip of the Week 4-30

Do I Have a Hobby or a Business?

There is a difference in the eyes of the IRS between a business and a hobby, and that difference can have a significant impact on your tax return.

If you enjoy reading IRS regulations in your spare time (and if you do, we should probably talk), here is the official guidance on Activities Not Engaged in for Profit:

https://www.ecfr.gov/current/title-26/chapter-I/subchapter-A/part-1/subject-group-ECFRcc67ec453a5e514/section-1.183-2

The IRS considers several factors when determining whether an activity is a business or a hobby:

• Is there an intent to make a profit?
• Is the activity carried out like a business with complete and accurate books and records?
• Do the taxpayers and their advisors have the knowledge needed to carry out the activity as a successful business?
• How much time and effort is devoted to the activity?
• Are operations adjusted to improve profitability?
• Does the taxpayer depend on income from the activity for their livelihood?
• Are losses due to circumstances beyond the taxpayer's control, or are they normal during the startup phase?
• Has the activity made a profit and, if so, how much?
• Can the taxpayer expect to make a future profit from appreciation of assets used in the activity?

Why does this matter?

A taxpayer operating a legitimate business may deduct ordinary and necessary business expenses, even when those expenses exceed income and create a loss.

A hobby is different. Hobby income is generally taxable, but hobby expenses are generally not deductible for federal income tax purposes.

The line between a hobby and a business is not always obvious. If you have an activity that generates income, it is a good idea to work with a qualified tax professional to ensure it is reported correctly.

I do read IRS regulations and Tax Court cases. Here are two fairly recent Tax Court cases on this topic: Kolar v. Commissioner (T.C. Memo. 2026-15), where the Court sided with the taxpayer, and Young v. Commissioner (T.C. Memo. 2025-95), where the Court sided with the IRS. In each case, the Court applied the nine-factor profit-motive test.

We speak (and read) tax so you don't have to.

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05/14/2026

Tax Tip of the Week 4-29

The “Kwong Decision” for Dummies Edition

“Wait… the IRS MAY owe ME money because of COVID penalty rules!”

Possibly.
(Yes, really.)

A recent court case — Kwong v. United States — basically said the IRS may have improperly charged certain penalties and interest during the COVID disaster period.

Let’s break this down in plain English (or as plain as tax law allows).

What the Court Said
The nationwide COVID disaster declaration may have automatically extended a whole bunch of IRS deadlines from:

January 20, 2020 → July 10, 2023

If those deadlines were extended, then some penalties and interest the IRS charged during that window may not have been legal.

Translation for Normal Humans
If you were hit with:

Failure-to-File penalties

Failure-to-Pay penalties

Interest charges

…there might be money sitting on the table.

BUT… before you start planning a Caribbean vacation:
The IRS is appealing the case.

Refunds are NOT automatic.

You generally need to file a protective claim to preserve your rights.

The big deadline appears to be July 10, 2026.

This is one of those classic tax situations where:

“The answer is maybe… and it depends…”

Which means:

👉 Talk to your friendly neighborhood Tax Pro before doing anything.
👉 Do NOT file a protective claim because you watched a 43‑second TikTok from “TaxBro420.”

We speak tax so you don’t have to.

05/08/2026

Tax Tip of the Week 4-28

Film Noir Mode: ON

“We must see your papers,” said the IRS agent from the shadows.

Claiming charitable donations?
Business mileage?
Home office?
Energy credits?
Tips or overtime deductions?

Documentation matters.

If you claim deductions without records, the IRS may deny the deduction and may assess accuracy-related penalties.

Just ask Thomas Langlois. In Langlois v. Commissioner, T.C. Memo. 2025-12, the Tax Court denied unreimbursed employee business expenses and partnership losses for lack of substantiation. He was also hit with accuracy-related penalties. Your Tax Pro may ask annoying questions like:

“Do you have a mileage log?”
“Was it written down at the time?”
“Who did you meet, where, when, and why?”

That is not because we are trying to ruin your day. It is because “trust me” is not a tax strategy.

Your documentation should be contemporaneous. If you drive to Gilford on May 6 to meet a client, record it that day: where you went, who you met, why you went, and how many miles.

Get in the habit of saving receipts and recording your actions.

Because in tax world, if it is not documented, it may not have happened.

We speak Tax, so you don’t have to.

Send a message to learn more

04/29/2026

Tax Tip of the Week 4-27

I’m still recovering from Tax Season… (yes, yes—two weeks ago… I know, I know 😄).

But in the meantime, Internal Revenue Service Tax Tip 2026-26 is actually worth a look—especially if you’re a gig worker. There’s some solid guidance in there that could save you headaches (and maybe a few dollars).

Give it a read at the link below.

And when you’re done trying to decode it… you probably want to reach out to your friendly neighborhood Tax Pro.

Because remember—
We speak tax, so you don’t have to.

Tax Tip 2026-26: Filing tips and updates for gig economy workers Internal Revenue Service (IRS) sent this bulletin at 03/31/2026 10:50 AM EDT IRS Tax Tips March 31, 2026 Issue Number: Tax Tip 2026-26 Filing tips and updates for gig economy workers One, Big, Beautiful Bill What is gig economy? Income...

04/25/2026

Tax Tip of the Week 4-26

🏡 Section 121 – Sounds Simple… Until It Isn’t

Under Internal Revenue Code Section 121, homeowners may exclude up to $250,000 of capital gain ($500,000 if married filing jointly) on the sale of their primary residence—if they’ve owned and lived in the home for at least 2 of the last 5 years.

Pretty straightforward… right?

Not so fast.

Here’s where things get interesting:
What if you used your home as a short-term rental?
Do the 2 years have to be consecutive?
If there are multiple owners, can each claim $250,000?
How is basis determined (and why does it matter so much)?
Can you qualify for a reduced exclusion?
For married couples:
Do both spouses need to meet the use test?
Do both spouses need to meet the ownership test?
Did you claim a home office?
What if the property is a multi-family home?
What about a trust-owned property?
How often can you actually use Section 121?

Bottom Line

Section 121 is one of the most powerful tax breaks available to homeowners…

…but only if it’s applied correctly.

One rental period, one wrong assumption, or one missed detail can turn a “tax-free” sale into a taxable one.

Before you assume your gain is fully excluded, have the conversation.

📞 Contact your tax professional.

We speak tax so you don’t have to.

Send a message to learn more