Tax Time!

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January 11, 2024
Author: Adam Kintigh

Start Your Business with a Nevada LLC

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NCH will be a guest next week on ADPI Campus where we will dive deep into necessary steps you need to take in to maximize your tax savings! 

If you’re a W-2 employee, own your home, and have no business activity, turbo tax or H&R Block will be fine. No need to overthink this.

However, if you have rental properties or business activity, you’ll need to shift gears. Having a good CPA that understands business and investments is critical.  

If you own rental properties, the biggest mistake we see is incorrectly accounting for repairs and maintenance versus capital improvements. Often, to increase write offs, people calculate capital improvements as repairs and maintenance. Capital Improvements get amortized over a period of 5, 7, 15, or 27.5 years. Whereas Repairs & Maintenance are calculated as fully deductible the year you incur the expense.  

The second biggest mistake is having the wrong cost basis. When you initially buy a property, the purchase price is treated as your Basis. The basis gets amortized over a 27.5-year period (for residential real estate) and creates a passive loss, which offsets your passive income. If you, or your tax preparer, did not input numbers in the right place, your basis is wrong, and every year thereafter will be wrong!

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For people that start a business, or a side hustle, the biggest mistakes are adding items to the Schedule C without proper documentation. Schedule C is where we list all the “business expenses.” These business expenses will offset your other sources of income such as W-2’s and self-employed income. Often, people see the amount they owe and start making up numbers, hoping they don’t get audited! “Uh, how many miles did I say? Let’s try 20,000 miles – now how much do I owe?”

Mark your calendars for Wednesday January 17th at 5:30 CST. If you’re not part of ADPI Campus, reach out to Nichole Biccum or Beth Bernards. Your CPA is only as good as the records you keep. You don’t want to miss this event!

With NCH, the state’s top business formation service, you can register your LLC in Nevada quickly and easily. Our specialists will help you choose the right entity for your company and understand why an LLC in Nevada is your best option. We’ll assist you with all necessary Nevada LLC forms, including the vital Articles of Organization, and help you comply with state regulations. In addition, we offer expert assistance with tax compliance, credit building, and payroll management. Schedule a private consultation to explore effective solutions to minimize tax liabilities and protect your wealth. Start unleashing your LLC’s full potential today with NCH. Schedule a consultation with Adam Kintigh today!

DISCLAIMER: The above material has been prepared for informational purposes only, containing opinions of the provider, and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. Please consider consulting tax, legal, and accounting advisors before engaging in any transaction.

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