We specialize in bookkeeping, payroll, income tax return preparation, and retirement planning, and serve a nationwide clientele consisting of individuals and businesses of all types and sizes (LLC, partnerships, C & S Corporations), as well as trusts and estates. As financial problem solvers, we provide practical advice and proactive solutions with personalized service. We are affordable, experienced, and friendly, and we tirelessly study and research the ever-changing world of tax law and regulation so that we can help every client realize the greatest possible savings and return on investments. Our office is conveniently located in Dover, Delaware. Please contact us today to find out more about how we can make YOUR life less taxing!Tax
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๐๐ฎ๐ป ๐ ๐ด๐ฒ๐ ๐ฎ ๐๐ฎ๐
๐ฏ๐ฟ๐ฒ๐ฎ๐ธ ๐ณ๐ผ๐ฟ ๐ฎ ๐ฐ๐ผ๐น๐น๐ฒ๐ด๐ฒ ๐ฐ๐น๐ฎ๐๐ ๐ ๐๐ผ๐ผ๐ธ ๐๐ผ ๐๐ฝ๐ด๐ฟ๐ฎ๐ฑ๐ฒ ๐บ๐ ๐ท๐ผ๐ฏ ๐๐ธ๐ถ๐น๐น๐?
You can use the Lifetime Learning Credit to lower your federal tax bill even if you aren't enrolled in a full degree program. This credit offsets 20% of your first $10,000 in qualified tuition and enrollment fees.
To max out the $2,000 cap, you can group your expenses into a single tax year. IRS rules state you can claim tuition paid now for an academic term that starts within the first three months of the following calendar year.
If you haven't hit the $10,000 qualified expense limit by mid-December, pay your upcoming Spring semester tuition before December 31st.
Prepaying your tuition keeps you from splitting expenses across two separate years and diluting your annual credit. Just make sure your course is hosted by an eligible institution that issues Form 1098-T.
๐๐ฉ๐ข๐ต ๐ช๐ด ๐ฐ๐ฏ๐ฆ ๐ฑ๐ณ๐ฐ๐ง๐ฆ๐ด๐ด๐ช๐ฐ๐ฏ๐ข๐ญ ๐ด๐ฌ๐ช๐ญ๐ญ ๐บ๐ฐ๐ถ'๐ณ๐ฆ ๐ญ๐ฐ๐ฐ๐ฌ๐ช๐ฏ๐จ ๐ต๐ฐ ๐ถ๐ฑ๐จ๐ณ๐ข๐ฅ๐ฆ ๐ฃ๐ฆ๐ง๐ฐ๐ณ๐ฆ ๐ต๐ฉ๐ฆ ๐บ๐ฆ๐ข๐ณ ๐ฆ๐ฏ๐ฅ๐ด?
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๐๐ผ๐ ๐ฎ๐ฟ๐ฒ ๐๐ผ๐ ๐๐ฟ๐ฎ๐ฐ๐ธ๐ถ๐ป๐ด ๐๐ผ๐๐ฟ ๐ฝ๐ฒ๐ฟ๐๐ผ๐ป๐ฎ๐น ๐ฒ๐
๐ฝ๐ฒ๐ป๐๐ฒ๐ ๐ฟ๐ถ๐ด๐ต๐ ๐ป๐ผ๐?
๐ Spreadsheet
๐ฑ Budgeting app
๐ Relying on bank alerts
๐ "What budget?"
Drop the emoji below that matches your approach.
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๐ฆ๐ต๐ผ๐๐น๐ฑ ๐ ๐๐๐ฒ ๐ฆ๐ฒ๐ฐ๐๐ถ๐ผ๐ป ๐ญ๐ณ๐ต ๐ผ๐ฟ ๐๐ผ๐ป๐๐ ๐๐ฒ๐ฝ๐ฟ๐ฒ๐ฐ๐ถ๐ฎ๐๐ถ๐ผ๐ป ๐ณ๐ผ๐ฟ ๐บ๐ ๐ฏ๐๐๐ถ๐ป๐ฒ๐๐ ๐ฒ๐พ๐๐ถ๐ฝ๐บ๐ฒ๐ป๐ ๐ฝ๐๐ฟ๐ฐ๐ต๐ฎ๐๐ฒ๐?
One strategy is to apply Section 179 first to erase your active business income down to zero. Then, apply 100% Bonus Depreciation to any remaining asset basis if you want to strategically generate a tax loss.
Here is why: you can't use Section 179 to create a tax loss because it is strictly limited to your net business taxable income. On the flip side, 100% Bonus Depreciation doesn't care about your net income.
For example, if your net income is $100,000 and you buy a $150,000 machine:
โข ๐๐ช๐ต๐ฉ ๐๐ฆ๐ค๐ต๐ช๐ฐ๐ฏ 179: You can only deduct $100,000 this year. The remaining $50,000 carries forward to next year.
โข ๐๐ช๐ต๐ฉ ๐๐ฐ๐ฏ๐ถ๐ด ๐๐ฆ๐ฑ๐ณ๐ฆ๐ค๐ช๐ข๐ต๐ช๐ฐ๐ฏ: The purchase pushes your business into a $50,000 Net Operating Loss, which can potentially offset other income.
This distinction gives you more control over your tax outcome. You can decide whether it makes more sense to wipe out your current business tax bill or intentionally create a loss to offset other income.
When you look at your financial goals for this year, is your priority clearing out your active business income, or are you looking for ways to offset other income sources?
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First State CPAs & Associates |
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18 S. State St, Dover, DE 19901 |
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| (302) 736-6657 | |
| Business Hours | |
| January 1st January 31st | |
| MondayโFriday: | 8amโ5pm |
| Saturday & Sunday: | closed |
| February 1st April 15th | |
| MondayโThursday: | 8amโ6pm |
| Friday: | 8amโ5pm |
| Saturday: | By appointment |
| Sunday: | closed |
| April 16th December 31st | |
| MondayโThursday: | 8amโ5pm |
| Friday, Saturday & Sunday: | closed |