announcements

The IRS offers an employment tax settlement program called the Voluntary Classification Settlement Program (VCSP). This program allows employers to reclassify as employees those workers they have erroneously treated as independent contractors. The program has generous payment terms, and participants get relief from employment tax audits for previous years. Here are the details.

Employers can qualify for a tax credit known as the work opportunity tax credit that is worth as much as $2,400 for each eligible employee ($4,800, $5,600 and $9,600 for certain veterans and $9,000 for "long-term family assistance recipients"). The credit is generally limited to eligible employees who began work for the employer before Jan. 1, 2020. The credit, calculated as described below, is available on an elective basis for employers hiring individuals from one or more of nine targeted groups.

Did you know that you can deduct "commuting" expenses between your home and temporary job locations? Daily transportation costs between your home and a regular work location are nondeductible commuting expenses. However, you may be able to deduct costs of going to and from your home and a temporary (not regular) job location.

Casey Peterson, Ltd. is seeking a Senior Tax Associate to join their Rapid City, SD team.

Casey Peterson, Ltd. is seeking an Accounting Services Associate to join their Rapid City, SD team.

Casey Peterson, Ltd. is seeking an Accounting Services Senior Associate to join their Rapid City, SD team.

The Tax Cuts and Jobs Act (TCJA) places new limits on individuals’ itemized deductions of non-business taxes. For tax years 2018 through 2025, the TCJA limits the aggregate deduction for state and local real property taxes; state and local personal property taxes, state and local, and foreign income, war profits, and excess profits taxes; and general sales taxes (if elected) for any tax year to $10,000 ($5,000 for married filing separately).

Under the pre-Act rules, you could deduct interest on up to a total of $1 million of mortgage debt used to acquire your principal residence and a second home, i.e., acquisition debt. For a married taxpayer filing separately, the limit was $500,000. You could also deduct interest on home equity debt, i.e., other debt secured by the qualifying homes. Qualifying home equity debt was limited to the lesser of $100,000 ($50,000 for a married taxpayer filing separately), or the taxpayer's equity in the home or homes (the excess of the value of the home over the acquisition debt). The funds obtained via a home equity loan did not have to be used to acquire or improve the homes. So you could use home equity debt to pay for education, travel, health care, etc.

The Tax Cuts and Jobs Act (the Act) has made changes to the tax treatment of alimony that you will be interested in. These changes take effect for divorce agreements and legal separation agreements executed after 2018. Current rules. Under the current rules, an individual who pays alimony or separate maintenance may deduct an amount equal to the alimony or separate maintenance payments paid during the year as an "above-the-line" deduction. (An "above-the-line" deduction, i.e., a deduction that a taxpayer need not itemize deductions to claim, is more valuable for the taxpayer than an itemized deduction.) And, under current rules, alimony and separate maintenance payments are taxable to the recipient spouse (includible in that spouse's gross income).