Notice of Key Issues for End of 2018 Legal Tax Planning

As many of you are aware, there have been many changes to U.S. tax law this year with numerous opportunities and pitfalls. To help you avoid the pitfalls and take advantage of the opportunities, we wanted to provide a list of tax issues you should be considering before the end of the year.

• Opportunity Zones – If you have sold property for a capital gain, you can get a deferral and even forgiveness of up to 15% of the gain by rolling the proceeds into an “Opportunity Zone Fund” within 180 days.
• Stock Compensation – If you are providing stock compensation to certain employees, you must notify them of the ability to make a tax deferral election under 83(i) otherwise there is a fine of $100 per failure, up to $50,000.
• Alimony – Alimony payments are not deductible to the paying spouse unless an alimony agreement is reached before the end of 2018.
• Depreciation Deduction Changes – Under the new 168(k), now acquisition of USED equipment qualifies for an immediate 100% depreciation deduction. If you have had a good year, you might consider trading equipment with another unrelated party (or acquiring new equipment) to accelerate depreciation deductions.
• Under the new Wayfair Supreme Court decision, you may have to start collecting sales tax for online sales even if you do not have a physical presence in the state.
• Due to the new foreign tax structure, a C corporation may be a more advantageous holding company for foreign investments. You should re-evaluate your corporate structure in light of the new tax law changes.