Medcom Benefit Solutions prides itself on helping employees, employers, brokers, and partners navigate the turbulent waters of today’s tax, healthcare, and compliance systems. We are also here to keep you up-to-date about new laws and how they affect you and your business.
Below, we have mapped out the top 10 most important takeaways from the recent IRS tax reform legislation.
- This may mean huge savings during tax season: Many business owners may deduct up to 20% of their qualified business income! Here are the FAQs to learn more: https://bit.ly/2RbxOtc
- There is a temporary 100% expensing for specific business The depreciation deduction is only for items placed in service during that tax year, and includes things such as: machinery, equipment, computers, and appliances.
- Some business owners may have to pay quarterly installments of estimated tax unless they owe less than $1000 when they file, or if they had no tax liability in the prior tax year. More information can be found here: https://bit.ly/2AaYhhG
- The new tax law eliminates the deduction for expenses related to entertainment, amusement or recreation.
- Luckily the recent reform does NOT eliminate the deduction of business meals. Taxpayers are still able to deduct 50% of the cost of business meals as long as they or an employee are present. Eligible meal expenses include dining with current or potential clients, consultants, or business contacts.
- Deductions for transportation fringe benefit expenses are no longer considered. However, there IS an exception to the rule: Transportation expenses necessary for employee safety are deducible!
- Bicycle commuting is now a deductible expense! From 2018-2025 employers may deduct qualified commuting expenses if the employee is traveling by bike. Employers must now include these travel reimbursements in the employee’s wages.
- Eligible moving expenses that were reimbursed by the employer are now subject to Federal Income tax.
- Reimbursements paid to employees or payments to moving companies incurred in the prior year are not subject to federal income or employment taxes.
- Employees can now truly enjoy those achievement awards! New rules allow an employee to exclude specific awards from their wages if the award is tangible property. Tangible property does not include: cash, cash equivalents, gift cards, coupons, gift certificates, and several other items. Check out all fringe benefit changes here: https://bit.ly/2CF9FYy
To learn more about this or other tax laws, visit: https://www.irs.gov/tax-reform.
Medcom provides full-service solutions for many of your employee and employer needs. We offer ACA support, Health and Welfare Compliance assistance, Fringe Benefit management, and many other keys to making business more manageable. In the weeks to come, we will take a look at all the services Medcom offers and how they are designed to help employers meet the challenges of a rapidly changing workforce.