Loreen Huddleston CPA

This is a great time of year to check your withholdings and estimated taxes. The next estimated tax due date is September 17. The federal government automatically reduced your withholdings due to the tax cuts. If not enough tax is withheld or paid in advance, you could be hit with underpayment penalties. Contact me to review if you have any uncertainty as to the adequacy of your withholdings or estimated taxes, as your income and deductions could change during the year.

From Santa Clara County Supervisor, Mike Wasserman. If you are not eligible for this low income housing program, perhaps your grown children or friends are. Pass this on. "In June, the County Board of Supervisors unanimously approved $25 million to finance a new first-time homebuyer down payment loan program. The funds will assist approximately 250 households in the first five years of the program by providing deferred loans for down payments of up to 17% of a home’s purchase... price. The funds are part of the 2016 Measure A $950 million affordable housing general obligation bond that was approved by 68% of voters. This is just one of the many programs that the County has launched to address our region’s housing crisis. We also recently approved funding for housing developments that will provide 461 new housing opportunities for low income households. For more information, call the Housing Trust of Silicon Valley -- our partner for the program -- at (408) 436-3450, ext. 234." See more

The IRS extended the tax deadline until tomorrow (4/18) due to the IRS e-file and online payment systems crashing today. Get your tax returns filed tomorrow if you didn’t get it filed today. California is giving a similar extension.

Happy Tax Day! If you haven’t filed your tax returns, go to www.irs.gov and download Form 4868. Complete the form and mail it to the IRS along with a check for the amount you think you might owe. It will eliminate late filing penalties and reduce other potential penalties. Instructions are available on that site as well.

The new tax law is very complex. For some taxpayers, their tax returns will become much more simple. With the increase in the standard deduction for individuals, fewer people will be itemizing deductions. This opens up some tax planning opportunities that may be beneficial to explore. For businesses, there are several new provisions--some good and some not so good. There is a new "deduction" that will apply to certain pass-through income, including some income earned by sole ...proprietors, as well as net rental income. This could be a significant benefit to many taxpayers, but not for all, as there are restrictions. One important note for businesses is that Entertainment expenses will no longer be deductible (no more deductions for taking a client to a Sharks game, for instance). It would be a good idea to begin segregating in your accounting records Entertainment from business Meals, as business meals are still 50% deductible. The limit for writing off business assets was increased, which is good. California will probably not conform, which is not so good. I will be exploring planning opportunities with my clients. If you have questions about various strategies you may employ, let's talk.