Since the ACA (Affordable Care Act) became law, a number of changes have been made to its implementation and rules. In order to remain compliant, I recommend that our clients focus on the necessary reporting and disclosures as well as potential tax liabilities and health coverage reimbursement relief. In general, any entity that provides minimum essential health coverage (MEC) to its employees must report that coverage to both the employee and the Internal Revenue Service (IRS).
This requisite reporting also applies to health insurance carriers or issuers, government units, plan sponsors of self-insured group health plans, and sponsors of MEC. Once received, the reported information is used by the IRS to administer the ACA and by taxpayers to verify compliance with the individual mandate. Here are some forms I believe all our clients need to understand:
•Form 1095-B – Health Coverage
•Form 1095-C – Employer Provided Health Insurance Offer and Coverage
•Form 1094-B – Transmittal of Health Coverage Information Returns
•Form 1094-C – Transmittal of Employer-Provided Health Insurance and Coverage Information Returns
Tenant Improvements and Final Repair and Maintenance Regulations
Under IRS and Treasury Department final regulations on the deduction and capitalization of expenditures related to tangible property (the repair and maintenance regulations), landlords may be able to deduct certain costs related to the refreshing or renovating of leased space for existing tenants. Tenants should also be aware that refreshments or improvements paid for out of their own funds may be tax deductible as well. I highly recommend that both landlords and tenants look into this opportunity.
Depreciation Update for 2015- Considering the lack of action by Congress, how can we plan to purchase equipment?
Last December Congress retroactively extended bonus 179 depreciation and the $500,000 limit for a section 179 deduction through 2014.The following July, the Senate Finance Committee voted 23 to 3 to extend bonus depreciation and the enhanced section 179 deduction through 2016.
However, the full Senate has not indicated if or when it will act on this legislation and the House is not scheduled to take up extenders until the fall. Even with the current uncertainty, this has proven to be an excellent tax planning tool and should still be considered by business owners.
Bonus depreciation may result in substantial present value tax savings for businesses that already had plans to purchase or construct qualified property. Unlike section 179 expensing, you do not need net income to take bonus depreciation deductions. Further, although bonus is not limited to smaller businesses or capped at a certain dollar level, it is not available for used property, property used outside of the US, tax-exempt use property, or tax-exempt financed property. While considering this, please also keep in mind that many states are likely to opt out of this provision for state income tax purposes.
If you have any questions please call to set up a meeting with one of our tax professionals.
Capstone CPAs, LLC has fully staffed offices in Bend and Sisters to meet your accounting and tax needs.
541-382-5099 – Bend
541-549-1237 – Sisters
www.capstonecpas.com
