November 1, 2016
Commercial buildings and improvements generally are depreciated over 39 years, which essentially means you can deduct a portion of the cost every year over the depreciation period. (Land isn’t depreciable.) But enhanced tax breaks that allow deductions to be taken more quickly are available for certain real estate investments:
Although these enhanced depreciation-related breaks may offer substantial savings on your 2016 tax bill, it’s possible they won’t prove beneficial over the long term. Taking these deductions now means forgoing deductions that could otherwise be taken later, over a period of years under normal depreciation schedules. In some situations — such as if in the future your business could be in a higher tax bracket or tax rates go up — the normal depreciation deductions could be more valuable.
For more information on these breaks or advice on whether you should take advantage of them, please contact us.
A tax deduction isn’t the only reason for donating a vehicle to charity. But if you’re counting on one, make sure you understand the rules. You may wind up with a small deduction or none at all.
If payroll taxes withheld from employees’ paychecks aren’t remitted to the federal government, a severe tax penalty can be personally imposed on “responsible” individuals.
Your succession plan should incorporate various strategies to accomplish your retirement and estate planning goals. One to consider: separating business interests from real estate holdings related to the company.