- Even the IRS accounts for inflation (sorta): The IRS standard business mileage rate will be raised from 67 cents/mile to 70 cents/mile. This rate also applies to electric and hybrid vehicles. Meanwhile, while income ranges for tax brackets, the standard deduction, HSA contribution limits, and IRA/401(k) limits increased slightly as well, itemized deductions stayed mostly the same.
- Come on, kids aren't that expensive: The Child Tax Credit did NOT change and is still $2,000 per child, phasing out at higher incomes. Considering the average annual cost of raising a child is actually closer to $13K and rising, we'd advocate for this one going up.
- Bonus depreciation shrinkflation: Bonus depreciation drops from 80% to 60% in 2024 and 40% in 2025 and will phase out completely in 2027 unless the policy changes. Trump has said he wants to reinstate 100% bonus depreciation and make it permanent, so we'll see if business owners continue to get that boost.
- PTE Tax: For those of you who pay Pass-Through Entity tax in order to be able to deduct the full amount (there is currently a cap of $10,000 deduction on state and local taxes), Trump has proposed to eliminate the cap. This could eliminate the extra checks you stroke to the state (from the business) and, in North Carolina, the confusing final deadline of 12/15 instead of 1/15 like everything else.
- Spend money, make money, save the planet: Electric vehicle credits up to $7,500 (here's a full list of vehicles that qualify) and residential clean energy credits for solar, wind, geothermal, and fuel-cell technology (credit amounts vary) could be available for all you Tesla and planet lovers.
And Bonus #6, not tax-related, but ... whiplash, anyone?
December 3, 2024: A Texas federal court issued a nationwide injunction, halting enforcement of the CTA less than a month before deadline.
December 23, 2024: The Fifth Circuit temporarily stayed the injunction, effectively reinstating BOI filing requirements with an extended deadline to Jan. 13 (so generous!).
December 26, 2024: The Fifth Circuit reversed its temporary stay, restoring the original injunction. BOI reporting is no longer required for now.
The bottom line: Get out the popcorn and wait. We'll keep you posted if compliance becomes necessary again.
Tax Tip of the Month: Don't ask ChatGPT for tax advice.
Who do you know that needs our services?
We're accepting new clients for...
1. Proactive accounting, tax & advisory
2. Tax resolution
3. Forensic accounting and fraud investigations
Who do you know that needs our services? Refer them here or reply to this email.
Client Story of the Month
$500k Trust-Fund Penalty win!
The IRS was actively pursuing two of our clients in an attempt to find them responsible for the Trust Fund Recovery Penalty arising from unpaid employment taxes. The amount was over $500K, and anyone deemed to have been responsible for the non-payment could be held liable.
We were able to show the IRS that neither of our clients had the independent authority to make or direct the payment of the taxes, and the IRS accepted our position, enabling us to protect our clients from a massive tax liability!
New Around Here
Meet Brittany Torres, our new Tax Client Engagement Coordinator. Brittany is your go-to for all things tax, and many of you will be hearing from her as we work through tax season and beyond. Brittany's an exceptional communicator who is truly dedicated to serving our clients at the highest level. We're so excited to have Brittany on the team!
“I love the opportunity to help clients navigate complicated situations and find solutions that make a positive difference in their experience. There’s a real thrill in turning a challenge into a resolution and knowing that I’ve made someone’s day a little easier or less stressful.”
A Question for You
What are your biggest challenges in 2025? How can we help?
Until next month,
Your Red Bike Advisors Team
About Red Bike Advisors
We're on a mission to equip small business owners with finance and tax insights that create exponential value for their companies, customers, employees, and families. From compliance to advisory, we take the confusion and scramble out of business finance and tax strategy and bring in clarity, growth, and peace of mind.
You are receiving this monthly update as a friend or client of Red Bike Advisors LLC. You may unsubscribe at any time. |
1650 Military Cutoff Rd. Suite 104, Wilmington, NC 28403
Click here to opt out of emails · Preferences