Tax season is near. Toby Mathis and Jeff Webb of Anderson Advisors answer your bookkeeping, real estate, and other tax-related questions. Submit your tax question to taxtuesday@andersonadvisors.

Highlights/Topics:

What happens when you donate a business vehicle that you used Section 179 on in 2019 and 2020 and then you donate it to a non-profit organization in 2021? If you take Section 179 before five years of ownership, you will need to recapture the gain

I have a rental in Phoenix, Arizona, that I am installing solar on. I’ve seen that I would qualify for the 26% federal tax credit as well as take the depreciation for the remaining amount that is being financed. Is this accurate? You can take a 26% credit for personal solar, but a deduction lowers your income; for business purposes, you can take 26% plus depreciation

If I invested in an Opportunity Zone last year with capital gains, I understand the taxes are deferred until 2026. Are those taxed at 2020 rates or 2026 tax rates? The 2026 rates because the income, not the taxes on that income, is being deferred until 2026

I’m selling a house that I inherited. I am on Social Security disability. Will the sale of the house affect my status? A sale of a home or any property has no affect on your Social Security; only early retirement income impacts your disability status

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Resources:

Tax and Asset Protection Workshop (Free 1-Day Virtual Event on Feb. 27)

http://aba.link/TAP227

Section 179

https://www.section179.org/section_179_deduction/

Charitable Organizations

https://www.irs.gov/charities-non-profits/charitable-organizations

Kars4Kids

https://www.kars4kids.org/

Form 940

https://www.irs.gov/forms-pubs/about-form-940

Form 941

https://www.irs.gov/forms-pubs/about-form-941

Schedule A

https://www.irs.gov/forms-pubs/about-schedule-a-form-1040

Schedule C

https://www.irs.gov/forms-pubs/about-schedule-c-form-1040

Solar Investment Tax Credit (ITC)

https://www.seia.org/initiatives/solar-investment-tax-credit-itc#:~:text=Quick%20facts,large%2Dscale%20utility%20solar%20farms.

Section 38

https://www.law.cornell.edu/uscode/text/26/38

Section 48

https://www.law.cornell.edu/uscode/text/26/48

Bonus Depreciation

https://www.irs.gov/newsroom/new-rules-and-limitations-for-depreciation-and-expensing-under-the-tax-cuts-and-jobs-act

Depreciation Recapture

https://www.investopedia.com/terms/d/depreciationrecapture.asp

Capital Gains and Losses

https://www.irs.gov/newsroom/capital-gains-and-losses-10-helpful-facts-to-know-0

Opportunity Zones

https://www.irs.gov/credits-deductions/opportunity-zones-frequently-asked-questions

Wills and Trusts

https://andersonadvisors.com/living_trusts/

Homestead Exemption

https://andersonadvisors.com/what-is-a-homestead-exemption/?highlight=homestead%20exclusion

CARES Act

https://www.congress.gov/116/bills/hr748/BILLS-116hr748enr.pdf

Retirement Plans

https://andersonadvisors.com/retirement_plan/

Real Estate Professional Requirements

https://www.irs.gov/pub/irs-utl/33-Real Estate Professionals.pdf

1031 Exchange

https://www.irs.gov/pub/irs-news/fs-08-18.pdf

Form 1099

https://www.irs.gov/forms-pubs/about-form-1099-misc

Self-employment Tax

https://www.irs.gov/businesses/small-businesses-self-employed/self-employment-tax-social-security-and-medicare-taxes

Old-Age, Survivors, and Disability Insurance (OASDI)

https://www.ssa.gov/policy/docs/progdesc/sspus/oasdi.pdf

Entity Formation

https://andersonadvisors.com/entity_formation/

Section 754 Election

https://tax.thomsonreuters.com/blog/consequences-of-a-section-754-election/

MileIQ

https://www.mileiq.com/

Cost Segregation

https://www.irs.gov/businesses/cost-segregation-audit-techniques-guide-chapter-1-introduction

Tax Cuts and Jobs Act (TCJA)

https://www.irs.gov/tax-reform

Section 121 Exclusion

https://www.irs.gov/taxtopics/tc701

Toby Mathis

http://tobymathis.com/about-toby-