2019 has been a transition year as taxpayers filed their first returns under the Tax Cuts and Jobs Act (TCJA). Not only have taxpayers become acquainted with the legislation, the IRS and Treasury continue to issue regulatory guidance interpreting the TCJA. While we are nearly two years in since its passage, substantial guidance in certain areas has yet to be issued.
Compliance with the TCJA is not the only issue affecting taxpayers (both businesses and individuals): After 10 years of economic growth, possible signs of recession are on the horizon. A tightening labor market creates hiring challenges for employers. Uncertainty in the ever-changing world of tariffs and trade policy makes planning difficult for many businesses, especially manufacturers and others operating internationally. In addition, entities facing downturns can no longer carry back net operating losses (NOLs) to obtain much-needed cash (via a tax refund) since the TCJA has repealed NOL carrybacks for most taxpayers. Consequently, managing cash and minimizing current taxes is even more critical if you anticipate a downturn in the economy.
We expect the remainder of 2019 and 2020 to be a dynamically changing time as additional TCJA guidance is issued and international tensions continue to impact trade and tariffs. We remind you that tax planning should be addressed throughout the year as an integral part of overall financial health. As always, we encourage you to contact your Baker Tilly advisor to discuss how these issues affect your tax position.
Visit the sections below for more information about the most pressing year-end tax issues:
We will continue to keep you informed of the latest developments by sending updates to assist you with planning throughout the remainder of the year. See our 2019 Tax Planning Guide for additional ways to help you reduce your taxable income by taking advantage of every tax break to which you are entitled.
The information provided here is of a general nature and is not intended to address the specific circumstances of any individual or entity. In specific circumstances, the services of a professional should be sought. Tax information, if any, contained in this communication was not intended or written to be used by any person for the purpose of avoiding penalties, nor should such information be construed as an opinion upon which any person may rely. The intended recipients of this communication and any attachments are not subject to any limitation on the disclosure of the tax treatment or tax structure of any transaction or matter that is the subject of this communication and any attachments.