Tax Tips: Shift capital gains to your children

This issue’s “Tax Tips” article details why taxpayers should consider giving appreciated stock to their children to minimize capital gains taxes, explains how to deduct bad debt and covers why “net, net gifts” are now a more viable strategy.


Partnerships: Get ready for new audit rules

For partnerships, the new audit rules are a game changer. The rules apply to returns for partnership tax years that begin after December 31, 2017, including amended returns. The changes aren’t merely procedural; they substantially alter the taxation of partnerships, effectively imposing entity-level taxes on partnerships. This article details the new rules and includes a sidebar explaining the opt-out clause.

When an inheritance is too good to be true: How income in respect of a decedent works

Even though most inherited property is tax-free to the recipient, this isn’t always the case with property that’s considered IRD. If a person has large balances in an IRA or other retirement account — or inherits such assets — IRD can be a significant estate planning issue. This article explains how to minimize or possibly eliminate IRD.

IRS hobby loss rules: Is it a business or hobby? 

If a start-up business owner is operating at a loss, it’s critical to understand the IRS’s “hobby loss” rules. Business losses are fully deductible, but hobby losses aren’t. Deductions for hobby expenses generally can’t exceed gross receipts (if any) from the activity. Also, the business owner must claim hobby losses as itemized deductions, which may further reduce their tax benefits. This article defines the word “hobby” and explains hobby loss rules.

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