Stay Ahead of the IRS: BOI Reporting, Key Tax Deadlines, Must-Know Legislative Changes, and the Mileage Deduction

Guess what, folks? Back in January, we ventured into the newsletter realm, and lo and behold, a handful of you actually opened it! You might've seen my name and thought, 'Ah, here they come again, talking taxes and numbers.' But surprise – that wasn't the case. I was hesitant to commit to a regular newsletter schedule, doubting my ability to keep up. Yet, here we are, fueled by your positive vibes and encouraging feedback. So, I've decided to roll up my sleeves and make a dedicated effort to keep this channel buzzing with useful insights for you. Here's hoping it sparks joy and curiosity alike. Enjoy!

Table of Contents

• BOI Alert: Navigating New Waters in Beneficial Own …

• Legislation Update & What It Means for Your Busine …

• Deadline Alert

• Tax Tips & App Recommendation

• Summary & Client Corner

BOI Alert: Navigating New Waters in Beneficial Ownership Reporting!

Remember our chat about BOI in the last newsletter? No, it's not a new fitness craze—it's all about the Beneficial Ownership Information Reporting Form. If you missed out, catch up with our full rundown here: https://wealthwise-ledger.beehiiv.com/p/clients-success-success .  It's a must-read to get in the know.

Now, for the nitty-gritty: the majority of you will need to tackle this form and submit it by year's end. Launching a new company in 2024? You've got 30 days post-formation to comply.

We toyed with the idea of offering a helping hand with this, but after much deliberation, we've decided it's a Herculean task that would divert us from our core missions. Yet, fear not! We wouldn't dream of leaving you adrift in the sea of potential $10k penalties for dropping the ball—yes, you read that right, $10k.

We've teamed up with a stellar company to bring you a straightforward, e-filing solution. We're all about making your life easier, so we recommend giving TRUSS BOI eFile a whirl. It promises a breezy (~8 minutes, to be exact) filing experience, steering you clear of any compliance headaches.

Ready to get this done? Click here to e-file and sail smoothly through compliance seas.

Legislation Update & What It Means for Your Business Tax Returns

 Got a business tax return looming on your horizon? Dealing with interest expenses or depreciation? Buckle up because this one's for you. This year, Congress decided to shake things up, shifting bonus depreciation from 100% deductibility down to 80%. On top of that, there are tighter reins on business interest expenses, especially for businesses with more than 35% limited partners (a shout-out to our Real Estate & Syndication clients – we're looking at you).

What does this mean in plain English? Your reported income or potential losses might not stretch as far as they used to under these new guidelines. Yes, it seems Congress is juggling politics with an attempt to bolster the economy through these and other tax law tweaks.

In a late January move, the House of Representatives passed the bill, Tax Relief for American Families and Workers Act of 2024 (H.R. 7024),  tossing it over to the Senate's court. And who's sitting on their hands? Chuck Schumer, Mitch McConnell, and their Senate colleagues. With the bill on their to-do list and the March 15th deadline breathing down our necks, it's an understatement to say the timing is tight. In my over 25 years in this field, I've never seen tax law changes hanging in the balance this close to crunch time.

Important Note: If you're currently receiving K-1s that are marked as final from your sponsors, there's a significant chance that something might have been overlooked. Given the extensive impact of these changes, it's unlikely there's a syndication group out there that isn't affected. If you're seeing K-1s coming in from other CPA firms, it could mean they've either missed this update entirely or have already made a decision for their group. It's crucial to check in with your sponsors. If their CPA firms haven't briefed them on these developments, there's a risk they might be unaware. Rest assured, we're fully engaged on this front for our clients, and keeping you informed about your options is our top priority.

 But don't fret – we're on top of it. As we dive into your returns, we'll keep you in the loop about how these changes could play out for you. For some, playing the waiting game might be wise, while others might choose to proceed with filing to lock in a higher income. And for those in syndication with a bundle of K-1s to consider, issuing a draft K-1 to your investors could be a savvy move, giving them a peek at what might be coming.

We'll be reaching out individually as we navigate your specific situation since these changes won’t impact everyone right off the bat. In the meantime, sit tight or, if you're feeling proactive, drop a line to your local senator. Let them know how crucial their timely action (or inaction) is for your filing process

Time flies when you're running a business, and tax deadlines wait for no one. A friendly reminder that all calendar year 1065s and 1120s are due by March 15th. But don't sweat it—here's how we're ensuring you're covered:

• For Our 2022 Family: If you were with us last year, breathe easy. We've automatically filed extensions on your behalf. Why? Because looking out for our peeps is just how we roll.

• New and Prospective Clients: Haven't joined the fold yet? There's still time to dodge the deadline drama. Reach out to us ASAP, and we'll ensure you get extended too.

• To Our Q1 Crew: We've been on a mission, reaching out to gather your info. It's crunch time, and your prompt response helps us help you stay ahead of the tax game.

 Our strategy to ease the tax season tension involves a bit of clever client segmentation. We're smoothing out our filing process by allocating specific quarters for client filings—February to April, May to July, and August to October. This method ensures we give each of you the meticulous attention you deserve.

Haven't heard from us yet? Don't worry, your spot in our schedule is secure. We have each client mapped out for their filing slot, and you'll be hearing from us soon if you haven't already.

Together, we're making tax season less taxing. Your trust in us to navigate these deadlines is something we don't take lightly. Here's to a smooth sailing tax season!

 When it comes to tax deductions for businesses, every mile counts—literally. The auto mileage expense deduction offers a valuable opportunity to reduce your taxable income based on the business use of your vehicle. Whether you're dashing between client meetings, picking up supplies, or attending industry conferences, your on-the-go business miles are potential savings at tax time.

 Why Every Mile Matters:

 The IRS allows businesses to deduct vehicle expenses using one of two methods: the standard mileage rate or actual car expenses (including gas, repairs, and depreciation). For many, the simplicity and ease of the standard mileage rate make it the go-to choice, but the key to unlocking this deduction is diligent record-keeping. Its 65.5 cents a mile in 2023 and 67 cents a mile this year, 2024.

 Enter MileIQ:

 Tracking every trip can seem daunting, but technology comes to the rescue with MileIQ. As a CPA and an entrepreneur constantly on the move, I personally swear by MileIQ for its effortless mileage logging. Here's why:

 - Automatic Tracking: Synced via Bluetooth with my truck, MileIQ automatically records every drive, ensuring no business mile goes unlogged.

- Easy Categorization: With a simple swipe, drives are classified as business or personal, making it a breeze to keep accurate records.

- Comprehensive Reports: Come tax time, generating a detailed mileage log is just a few clicks away, providing you with a robust defense in the rare event of an IRS audit.

 The Bottom Line:

An IRS audit might seem like a distant concern, but in the event it happens, a well-maintained mileage log is your best defense. MileIQ not only simplifies this process but also ensures you're maximizing your deductions, turning everyday drives into tangible tax savings.

Remember, with the IRS's stringent documentation requirements, "I guess" won't cut it. Tools like MileIQ offer a seamless way to uphold the highest standard of record-keeping, making sure you're prepared, compliant, and poised to capitalize on every deduction available to your business.

Embrace the ease of automated mileage tracking with MileIQ and drive your business forward, one tax-deductible mile at a time.

Explore MileIQ here https://mileiq.com/ or discover another app that suits your style. Or, if you prefer the old-school charm, jot down your miles in a notebook—dinosaur style. Whatever works for us. I lean towards MileIQ because it caters to my, let's say, 'efficient' nature. It's always on the job, diligently tracking every mile, even when it slips my mind.

Remember last month's 'Client Corner'? It's not just a section; it's a spotlight waiting to shine on you! Whether you're a General Partner with an eye for investment, on the brink of selling your empire, or championing a cause close to your heart, we're here to amplify your voice. Reach out to Bree, our newsletter maestro, and let's make your project the talk of the tax town.

Thank you for joining us on this enlightening journey through the numbers. Until next time, keep calculating, keep dreaming, and most importantly, keep sending us your feedback. Together, we'll navigate the choppy waters of tax season with ease, wit, and maybe just a touch of wizardry.

Thanks for reading , All of us at Porter & Company CPAs