Individual Tax

Reporting Bitcoin Cash

On August 1, 2017 Bitcoin Cash split from Bitcoin.  Each investor that owned Bitcoin on or before the split received Bitcoin Cash in an amount equivalent to their current Bitcoin holdings.  Investors who were fortunate enough to receive the cryptocurrency for free must report it on their 2017 tax return as income.

Click here for more info.

By |June 18th, 2018|Categories: Accounting & Bookkeeping, Business Tax, Individual Tax|Comments Off on Reporting Bitcoin Cash

California Supreme Court Ruling Significantly Limits Independent Contractor Classification

The California Supreme Court has established new criteria for classifying workers as Independent contractors.   In Dynamex Operations West, Inc. v. Superior Court, the Court rejected the previous multi-factor test and instead issued a rigid 3-factor test, called the “ABC” test.

Under the ABC test, each of the following three factors must be met in order to classify a worker as an independent contractor:

  1. The worker must be free from the control and direction of the hiring company in performing the work.
  2. The work must take place outside the usual course of the business of the hiring company’s business.
  3. The worker is customarily engaged in an independent established trade, occupation or business.

This ruling will no doubt have a significant impact on gig companies in the Bay Area (Uber, Lyft, and DoorDash, etc.), […]

By |June 6th, 2018|Categories: Accounting & Bookkeeping, Announcements, Business Operations, Business Tax, Individual Tax, IRS, Real Estate, Retirement Planning|Comments Off on California Supreme Court Ruling Significantly Limits Independent Contractor Classification

Home Equity Loan Interest can still be Deducted (in certain instances)

The IRS clarified in its News Release on February 21, 2018 that taxpayers can continue to deduct the interest on home equity loans, if the home equity loans are used to buy, build or substantially improve the taxpayer’s home that secures the loan.

Under prior tax law (pre-2018), the interest on a home equity loan secured by the taxpayer’s qualified residence was deductible (on a loan balance of up to $100,000) even if the loan was used to pay personal living expenses, i.e., paying off credit card debts, student loans or buying a car.

Starting in 2018, the new tax law does not allow taxpayers to deduct the interest on a home equity loan if the loan was used for personal living expenses.

In order for home equity loan interest to be deductible, […]

By |February 25th, 2018|Categories: Individual Tax, IRS, Real Estate|Comments Off on Home Equity Loan Interest can still be Deducted (in certain instances)

2018 Tax Reform-Individual Tax Changes

The President signed the biggest tax reform law in over 30 years. When you file your 2018 tax returns — about a year from now — your tax return may look very different. And because most changes don’t happen until then, we have some time to learn about the changes and plan for next year. Here are a few of the biggest changes that may affect you.

  • Tax rate changes: The maximum individual rate is reduced to 37%.
  • Standard deduction increases: The standard deduction is almost double.
  • Personal exemption eliminated: You will have no personal exemption deduction for yourself, your spouse, or your dependents.
  • Increased Child Tax Credit and new Dependent Credit: The credit is increased for each child to $2,000 (up to $1,400 of which is refundable for each […]
By |February 5th, 2018|Categories: Announcements, BCo Community News, Individual Tax, IRS|Comments Off on 2018 Tax Reform-Individual Tax Changes

IRS Enforces Tax Regulations on Cryptocurrency

With cryptocurrencies like Bitcoin, Ethereum and Litecoin gaining in popularity among investors, the IRS is becoming more aware of those who fail to disclose their gains and/or losses. According to an article written by Accounting Today (Click Here to read article), the IRS is going after Coinbase, an online platform where you can buy and sell cryptocurrencies. A court ordered Coinbase to release information about over 14,000 of its customers who may not have reported their cryptocurrency transactions on their tax returns.

Now that the IRS has pointed its spotlight on this issue, we want our clients to know the tax implications that might occur when investing in cryptocurrencies.   Notice 2014-21 (Click here to read), which was issued by the IRS, describes how cryptocurrency transactions are taxed.

By |December 22nd, 2017|Categories: Individual Tax, IRS|Comments Off on IRS Enforces Tax Regulations on Cryptocurrency