J.K. Lasser's Small Business Taxes 2023

CHAPTER 24Income and Deduction Strategies

• Distributions from a Sole Proprietorship
• Distributions from a Partnership
• Distributions from an S Corporation
• Distributions from a C Corporation

Alert

At the time this book was published, Congress was considering tax changes that could affect 2022 tax returns and planning for 2023. Check the online Supplement in February 2023 at www.jklasser.com or www.BigIdeasForSmallBusiness.com to see what changes have been enacted and when they become effective.

Understanding what income you must report and the various business deductions you may claim is only half the job. You must also know when to report income and when to postpone it, when to claim certain deductions and when not to claim them. You should also be aware of the common traps that business owners often fall into with their income and deductions so you can audit‐proof your return to the extent possible.

Tax planning is always complicated, but this is a time of particular confusion. While many of the tax changes made by recent legislation are permanent, many others are temporary. For example, the lowered individual income tax rates and the qualified business income deduction for owners of pass‐through entities are set to expire at the end of 2025 and the noncorporate loss limitation applies through 2028. COVID‐19‐related changes ended in 2021. What's more, new legislation always contains uncertainties requiring technical corrections in Congress or IRS guidance. Finally, ...