TAX PLANNING 2018
In light of the new tax law, effective January 1, 2018, itemized miscellaneous deductions will no longer be deductible.
I believe that there are two effective ways to plan for this:
An employee can negotiate with his or her employer to have most or all business related expenses reimbursed to you by an accountable plan. This way the reimbursements are not taxable to the employee.
The second way is to establish a sole proprietorship or LLC business in which the employee receives a certain amount of his income as an independent contractor by way of a 1099. Having one’s own business is the best possible tax shelter. For example, a sole proprietor or a single-member LLC can employ one’s children or spouse, have a retirement plan, deduct various expenses including an office at home, etc.
Please note that meals are still deductible if conducted in connection with business, however, entertainment is no longer deductible under the new tax law effective January 1, 2018.
Both of these options are complicated and need to be discussed fully. If you have any questions, please feel free to call us at your earliest convenience