We Do Books™ Blog
Michael DiSabatino of We Do Books™ shares expert insights to help you unlock your business's full potential by delivering proven strategies for maximizing tax savings, streamlining operations, and driving sustainable growth.
The information provided on this site is for general informational purposes only and should not be construed as professional financial, tax, or legal advice. For advice tailored to your specific situation, we recommend consulting with a qualified professional. We Do Books is here to assist by calling 855-922-WeDo (9336)
The information provided on this site is for general informational purposes only and should not be construed as professional financial, tax, or legal advice. For advice tailored to your specific situation, we recommend consulting with a qualified professional. We Do Books is here to assist by calling 855-922-WeDo (9336)
For years you have put away money from your pay into your employer-provided 401(k) retirement savings account. Your employer may have even matched 50% of your contributions or contributed 3% of your pay to the account as part of a safe harbor program. Now you want to take some of this money out in the form of a loan to help pay your bills or to buy a car. Before you take action, here are some things to consider.
Your granddaughter needs a car, but cannot afford the payments. As a favor, you provide the $25,000 to purchase the car. You tell your granddaughter to pay you back when she can, but there is no loan document. The IRS sees this payment during an audit and asks where your interest income is for this loan. Should this happen, you will quickly understand the meaning of AFRs.
For years, the tax code trend was to reduce the amount of interest that may be deducted on your tax return.
Until recently, it really only allowed interest deductions as an itemized deduction on qualified residences and vacation property.
That is changing now with the passage of the OBBB Act and the introduction of a new car interest tax break.
Here is what you need to know:
Do you want to jump start your child's retirement with a million dollar tax-free account?
Consider this.
Before taking action, talk to your tax adviser.
How many times have you seen this legal disclaimer?
Unfortunately, all too often taxpayers do not follow this advice and then must pay the price with an unnecessarily high tax bill.
Here are some of the most common situations that can save you money by seeking advice before you act: