In an ongoing effort to help small businesses, the Internal Revenue Service (IRS) permits business owners to claim first-year bonus depreciation for some of their properties that are used in business. However, going by the passage of the Tax Cuts and Jobs Act of 2017 (TCJA), this bonus depreciation begins … Read more
The special depreciation allowance (SDA), commonly referred to as bonus depreciation is a tax incentive that allows businesses to deduct a large percentage of the cost of qualifying assets in the first year of use. This means that businesses can take advantage of the special depreciation allowance to reduce the … Read more
Journalizing adjusting entries are a necessary part of every company’s accounting or bookkeeping process because, without these adjusting entries, a company’s financial records which include the statement of financial position, statement of cash flows, and income statement will be riddled with errors and inconsistencies. When transactions occur in a business, … Read more
The Federal Reserve’s balance sheet is a critical tool for implementing monetary policy and has grown significantly over the years, particularly after the 2008 financial crisis. The Fed’s holdings of Treasury securities, mortgage-backed securities, and other assets, which expanded to more than $8.9 trillion as of 18th April 2022, have … Read more
Bonus depreciation was enacted by Congress’ Job Creation and Worker Assistance Act of 2002 as an additional first-year depreciation allowance that allows business taxpayers to deduct additional depreciation for the cost of qualifying business assets. According to the rules for bonus depreciation, by claiming this special depreciation allowance, businesses are … Read more
Whether you manage a rental property or you are a personal property owner, understanding how rental property bonus depreciation works is something that is vital to consider. Bonus depreciation is a very important concept in the real estate industry because it allows rental property owners to minimize their set-up costs … Read more
The adjusting entry for uncollectible accounts is essential in order to match bad debts with the sales of the period that gave rise to the bad debts. Sometimes in business, it may be the following year before one may discover that a sale made in the current year will not … Read more
When companies make sales on credit, they usually record such sales in an asset account called the accounts receivable. This account records monies that customers owe the business, however, not all customers are able to fulfill their obligation of paying for either goods or services which they had earlier received … Read more
Taxpayers can take bonus depreciation on residential rental property improvements but not on the actual rental property. There are qualified improvement properties that are eligible for bonus depreciation, thus, allowing taxpayers to deduct a large percentage of the cost of the qualified improvement property. Claiming this special depreciation deduction for … Read more
Congress’ Job Creation and Worker Assistance Act of 2002 enacted a tax incentive that allows a taxpayer to expense the entire cost or a large percentage of the majority of fixed assets in the year that they were purchased and put in service. This tax incentive is known as bonus … Read more
