#tax-planning

Tax Planning

Strategic tax planning to minimize liability and maximize savings

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May 19, 202612 min read

Section 1059 Extraordinary Dividend Basis Reduction: The Corporate Shareholder Trap That Turns Tax-Free Dividends Into Immediate Capital Gain

Section 1059 reduces a corporate shareholder's stock basis by the nontaxed portion of an extraordinary dividend — 5% threshold for preferred, 10% for common — when received within two years of acquisition, with excess immediately taxed as capital gain. This guide covers the thresholds, the 85-day and 365-day aggregation rules, the FMV election, the non-pro-rata redemption exceptions, and the lot-level bookkeeping that keeps corporate finance teams out of audit trouble.

Mike Thrift

tax-planningtax-compliancec-corporation

May 19, 202612 min read

When Capital Gain Becomes Ordinary Income: Section 1239 and the Family Business Trap

Section 1239 converts capital gain to ordinary income on sales of depreciable property between related parties — including a controlling owner and their own corporation, partnership, or trust. The constructive ownership rules under Section 267(c) make the more-than-50% threshold easier to cross than family business owners expect.

Mike Thrift

taxtax-planningdepreciation

May 19, 202612 min read

Section 30C EV Charger Credit Before the June 30, 2026 Cliff: Census Tracts, Prevailing Wage, and Form 8911

The Section 30C credit returns 30% of EV charger cost — up to $1,000 per port for homeowners and $100,000 per port for businesses — but sunsets after June 30, 2026. A line-by-line guide to census tract eligibility, prevailing wage and apprenticeship rules, depreciation interaction, recapture, and Form 8911.

Mike Thrift

tax-creditstax-planningtax-deadlines

May 19, 202613 min read

The Self-Rental Rule Under Section 469: How the Grouping Election Defuses the Passive Loss Trap

Section 469's self-rental rule recharacterizes rent from your own building as active income while losses stay passive — a one-way street that traps small business owners. A timely grouping election under Reg. 1.469-4 defuses it; missing the first-return filing window usually means living with the asymmetry for good.

Mike Thrift

taxtax-planningreal-estate

May 18, 202615 min read

California Proposition 19 and the End of the Old Parent-Child Property Tax Bargain: A 2026 Guide for Heirs of California Real Estate

How California's Proposition 19 replaced Section 63.1 for parent-child transfers after February 16, 2021 — the family home and farm rules, the one-year occupancy requirement, the BOE-19-P and BOE-266 filings, the $1,044,586 value cap floor, and the step-up-basis trade-off that determines whether to gift during life or transfer at death.

Mike Thrift

real-estateestate-planningtax

May 18, 202612 min read

The Convenience of the Employer Rule in 2026: Why Your Remote Workers May Still Owe Tax to the Office State

Eight states tax remote workers as if they sat in the office. A 2026 guide to the convenience of the employer rule, the May 2025 Zelinsky decision, reciprocity agreements, resident credits, and what multi-state employers must withhold.

Mike Thrift

remote-workmulti-state-taxtax-compliance

May 18, 202614 min read

The Minister's Housing Allowance: Section 107, the SECA Trap, and the Retired-Pastor 403(b) Designation

Section 107 lets ordained ministers exclude designated housing costs from federal income tax, but the allowance is still added back for SECA and only an in-advance written designation survives audit. A practical guide to the three-part cap, Form 4361's irrevocable opt-out, and the 403(b) designation that keeps a retired pastor's distribution income-tax-free for life.

Mike Thrift

taxtax-planningself-employment-tax

May 18, 202612 min read

The Charity Deduction You Get Without Itemizing: A 2026 Guide to the New $1,000 / $2,000 Above-the-Line Write-Off

Starting in 2026, taxpayers who take the standard deduction can deduct up to $1,000 ($2,000 for joint filers) of cash gifts to qualified public charities under new IRC Section 170(p) — cash only, no donor-advised funds, no carryforward, and the same $250 documentation rules as itemizers.

Mike Thrift

charitable-givingtax-deductionstax-planning

May 18, 202610 min read

The $15 Million Estate Tax Exemption Is Now Permanent: How High-Net-Worth Families Should Recalibrate SLATs, GRATs, and Lifetime Gifts in 2026

The One Big Beautiful Bill Act locks the federal estate, gift, and GST exemption at $15 million per individual with no sunset. Here is what changes for SLATs, GRATs, dynasty trusts, GST allocation, and basis planning in 2026 — and what to actually do this year.

Mike Thrift

estate-planningtax-planningtrust

May 18, 202611 min read

Permanent 100% Bonus Depreciation Returns: How Small Businesses Stack Section 168(k), Section 179, and QIP in 2026

The One Big Beautiful Bill Act made 100% bonus depreciation under Section 168(k) permanent for qualified property placed in service after January 19, 2025. This guide explains how small businesses coordinate Section 179, qualified improvement property, and the new Section 168(n) manufacturing deduction — and the acquisition-date rules that decide eligibility.

Mike Thrift

bonus-depreciationsection-179depreciation

May 18, 202614 min read

OBBBA Locks In the Section 199A QBI Deduction: A 2026 Playbook for Pass-Through Owners

Section 199A is now permanent under OBBBA. Pass-through owners get a 20% deduction, wider SSTB phase-in ranges ($75K single / $150K joint above the 2026 threshold), a new $400 minimum for material participants, and the same W-2 wage and UBIA tests at the top of the band.

Mike Thrift

tax-planningtax-deductionssmall-business

May 18, 202610 min read

The Standard Deduction Is Now Permanent: How OBBBA Reshapes the Itemize-vs-Standard Decision for 2026

How the One Big Beautiful Bill Act made the doubled standard deduction permanent, raised the SALT cap to $40,000, added a 0.5% AGI charitable floor, and stacked a $6,000 senior bonus deduction — with concrete math for the 2026 itemize-versus-standard decision.

Mike Thrift

taxtax-planningtax-deductions

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