PUTNAM POSTING: The Sky is Not Falling, but Your Taxes Could Be!
Jennifer Maher | February 2018
Today’s political climate is so full of partisan rage that many pundits seem to have lost their ability to evaluate clearly. The tax reform recently passed by Congress is a perfect example. The varying opinions out there seem to say it’s the worst or the best. That seemed rather far-fetched, so since I am not an accountant I did a little digging. Since I am self-employed, most of my research was from that perspective.
Tax reform has created some great opportunities, but they are not automatic. You must become aware of the changes and adapt your business structure to get the most out of it. The “C-Corp” corporate tax was lowered from a maximum of 35% to a flat rate of 21%. Most small businesses, however, are not C-Corporations. This lower tax rate means more dividends, though so-called “double taxation” on the dividends will still exist. This has caused the stock market to soar and will continue to do so. In any case, however, the differential and effective penalty for being a C-Corp is much smaller than it had been.
Pass through entities like LLCs or S-Corporations are treated differently under the reforms. Taxable income, which is your business income plus your personal income minus your personal deductions, is taxed at the new LOWER tax rate. The exciting part is the new special deduction of 20%, which will reduce your taxable income including any real estate investment income, etc.
You must know the new rules to get the new benefits. Home office deductions are modified, kids over seven years can be hired and paid reasonable wages (effectively creating a way to have a deduction, perhaps offsetting other costs like school tuition). Up to $12,000 (versus $6,500 in the old laws) is tax-free. Medical expenses have new HRA rules to benefit the self-employed. The most important thing to know is this: you have options, they can be good ones, and you should discuss with your accountant or a knowledgeable tax preparer.
Putnam County On Amazon Prime!
In my inbox this week was, “Fireball Run Season 10 is ready to binge watch on Amazon.” The e-mail was from J.J. Sanchez, executive producer of the Fireball Run Adventurally TV series that toured New York State in 2016 including Putnam County and the Hudson Valley. Amazon Prime is now making Fireball Run available to millions of viewers throughout the world.
For several hectic months, acting tourism directors and myself went crazy making arrangements, also luring in potential show participants who would be willing to be without their families and travel for a few weeks. We found exciting Putnam locations that fit the show’s requirements. And we mumbled under our breath at our friend Pete Bardunias, President/CEO of the Chamber of Southern Saratoga County and former CEO of the Greater Mahopac-Carmel Chamber of Commerce, who got us roped into this!
In the end, it all worked out. Fireball Run was our first exposure to the film and television industry, with two of Putnam County’s finest representing us: Sean Dunn of Well Dunn Construction and John Crecco of Villa Barone. Great Putnam destinations were showcased, including local businesses like Mahopac Marine, which volunteered boats and captains to transport everyone to the Frank Lloyd Wright inspired Massaro house in the middle of Lake Mahopac. Tommy from Bucci Brothers deli and staff catered at cost and Bull and Barrel Brewery brought delicious libations. The Massaro family generously opened their home to us despite the treacherous rainstorm. Our neighbors came together under less-than-ideal conditions, and we ended up with something we could all be proud of—an opportunity to show a piece of Putnam County to the entire world. Hopefully we can continue to build on this success.
So please tune into (or subscribe to) Amazon Prime and watch our community on Fireball Run Season 10! The direct link is: http://a.co/aJdevNB