Hot Tips For The New Tax Year Part 6

Posted on March 15, 2019

Section 529 Qualified Tuition Programs. Effective 2018. 529 plans can allow distributions of up to $10,000 per-student to pay tuition expenses for a public, private, or religious elementary or secondary school. The rules for postsecondary educational institutions are unchanged.

Estate and Gift Tax Exemption Amount. For 2018, the estate and gift tax exemption amount is doubled to $10 million, adjusted for inflation occurring after 2011 ($11,180,000 for 2018).
Net Operating Loss (NOL). For losses arising in tax years beginning in 2018, the NOL deduction is limited to 80% of taxable income (taxable income for the year in which it is carried to, determined without regard to the NOL deduction). The new law repeals the 2-year carryback and the special carryback provisions but provides a 2-year carryback in the case of certain losses incurred in the trade or business of farming. NOL carryovers are adjusted to take into account the 80% of taxable income limitation and may be carried forward indefinitely (until used up).

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