Posted by Kristin Oberlander - Here is some timely tax information release by the the IRS:
Small businesses with deductions exceeding their income in 2008 can use a new
net operating loss tax provision in the American Recovery and Reinvestment Act
to get a refund of taxes paid over the past five years instead of the usual
two.
To accommodate the change in tax law, the IRS has updated the instructions
for Form 1045 and Form 1139, which small businesses will use to take advantage
of the carryback provision.
• IRS Form 1045, Instructions
• IRS Form 1139, Instructions
An IRS
news release and question-and-answer
document have more information on the net operating loss carryback
provision.
More Help for Small Business
The Recovery Act also
includes the following business-related provisions:
• Sec. 179 Deduction
Increases to $250,000: An expanded Sec. 179 deduction allows small businesses to
write off up to $250,000 of qualified investment in 2009.
• Reduction of
Estimated Tax Payments: Normally, small businesses have to pay 110 percent of
their previous year’s taxes in estimated taxes. The Recovery Act permits small
businesses to reduce their estimated payments to 90 percent of the previous
year’s taxes.
• Extension of Bonus Depreciation Deductions Through 2009:
Bonus depreciation is extended through 2009, allowing businesses to take a
larger tax deduction within the first year of a property’s purchase.
•
Capital Gains Tax Break for Investment in Small Business: Investors in small
business who hold their investments for five years can exclude from taxation 75
percent of their capital gains.
Read more about the American
Recovery and Reinvestment Act of 2009.
Have your own tax questions? Ask the NASE’s TaxTalk!