Earlier this week we discussed the Tax Cuts and Jobs Act of 2017 and the limits placed on the deductibility of State and Local taxes for 2018. Now let’s discuss your 199A deduction. For many owners of pass-through entities, the new 199A deduction will generate welcome tax relief in 2018.
If your business qualifies based on your industry, you may be able to claim up to a 20% deduction of certain income. In addition, there may be an opportunity for you to use the savings and further reduce your tax burden in 2018. This may be accomplished by optimizing your retirement plan design. Often overlooked, there are designs available that can tailor benefits to business owners.
At Innovative, we’ve implemented many of these designs over the years, generating significant tax benefits for our clients. A simple analysis can illustrate the benefits of this approach, which can easily be adopted prior to year end.
Action must be taken before year-end to impact your 2018 taxes. It’s not too late. If you would like to discuss how this type of planning may benefit you, please contact our office.
