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Chronicles of Tax Advisors

On Edge with Tax Laws Till the Last Minute

Posted by Dave Motes Posted on Dec 18 2015

Here we are near the end of 2015, and already again politics has stirred up the “uncertainty” atmosphere we have experienced during recent year ends. The government waits till the very last moment to continue the ‘Bush tax cuts’ or ‘tax extenders’ that has been renewed each year since Bush left the White House 7 years ago. The two branches, the legislative (Congress) and the executive (the President), bicker amongst themselves and with each other until the proposed continuance is passed. This can make tax planning a tough job.

Uncertainty about whether a tax provision continues on to a new year complicates many questions. One of such is: is it wise to buy a big piece of equipment or a vehicle in the last quarter of the year? The ability to deduct the entire purchase price of the equipment through Section 179 is a major factor in one's decision to buy. So can I use bonus depreciation on that new truck if I buy it in December? It is another question that really cannot be answered until the extenders have been passed.

However, the consensus is the extenders will be passed for 2015 (which is a good thing since the year is almost gone). The current debate now is do we make these “temporary” extenders permanent. This uncertainty then gives rise to the question of when or how often we should reform our tax code.

Tax accountants actually love tax reforms. In fact, these attempts should be named neither tax simplification nor tax reform, but “tax accountants’ income security act.” Whenever the government makes an attempt to simplify anything it controls, that process inevitably becomes more complicated, and taxpayers painfully cry out to their accountants for help. Probably, about the only thing certain with the tax code is, if you owe the government money, the IRS will come after you!!! If that happens to you, though, we at Tax Advisors will tell you not to sweat it. We deal with these guys all the time.

Let me leave you with this: Have a very Merry Christmas and Happy, Prosperous New Year!!!  

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Dave Motes, CPA

Authorized to practice before the Internal Revenue Service

A Certified Public Accountant (CPA) is a federally authorized tax practitioner who has technical expertise in the field of taxation and who is empowered by the U.S. Department of Treasury to represent taxpayers before all administrative levels of the Internal Revenue Service for audit, collections, and appeals. 

 

 

Disclaimer: The information in this blog is for general informational and educational purposes only, including any comments provided by blog visitors. All stories described are accounts of actual experience with actual clients of Tax Advisors. Postings are not solicitations or legal advice. This information is not intended to create and receipt of it does not constitute an agent-client relationship. The reader should not rely or act upon any information in this site without seeking professional legal counsel or advice from his or her tax professional.

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