As you are most likely aware on December 22, 2017, President Trump signed the "Tax Cuts and Jobs Act of 2017" into law.
A major part of the Act relates to a tax deduction for pass through business entities. The final bill reduces pass-through taxes via a 20% deduction. For many businesses, it will not be a true 20% deduction. There are several complicating factors that determine if/how much of a tax deduction will be applied to pass through business income.
One of the most helpful visual representations of whether or not business will receive a 20% deduction is from this article:
The article author clearly points out that this is meant to be a visual representation to help you sort through some pretty complicated rules, and isn't meant to be a substitute for finding out more, including consulting with your tax professional.
I have received many questions and client inquiries as to whether clients should change their entity structure to benefit from this tax deduction. The answer varies according to several factors. I am happy to discuss the aspects of your business with you, feel free to contact me.
Disclaimer: The information in this blog post (“post”) is provided for general informational purposes only, and should not be construed as legal advice from Leos & Gilkerson, PLLC or the individual author, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting on the basis of any information included in, or accessible through, this Post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a licensed lawyer.