Under IRS guidance, business vehicle deductions for contractors can be figured with the standard mileage rate or with actual expenses, and the choice depends on the vehicle and on elections made in earlier years. For 2026, the IRS lists a business standard mileage rate of 72.5 cents per mile for January 1 through June 30 and 76 cents per mile for July 1 through December 31. This article summarizes what the IRS says about each method, when the standard mileage rate cannot be u

Under IRS guidance, a law firm may have to file Form 8300 when it receives more than $10,000 in cash in one transaction or in related transactions in the course of its practice. The IRS states that, generally, the form is due within 15 days after the cash is received, and it gives an example of an attorney who receives more than $10,000 in cash as an advance for legal services. Tax Wealth Consultant (TWC) prepared this article for law firm owners, managing attorneys, and firm

Under IRS guidance, the business interest deduction limit in Section 163(j) caps deductible business interest expense at the sum of business interest income, 30 percent of adjusted taxable income, and floor plan financing interest expense. A small business that is not a tax shelter and meets the gross receipts test is not subject to the limit, and the IRS lists the threshold as $31 million for 2025 and $32 million for 2026. Tax Wealth Consultant (TWC) prepared this article fo

Under IRS guidance, two federal energy efficiency incentives that builders and contractors may have used have an end date. The Section 45L new energy efficient home credit is not allowed for any qualified new energy efficient home acquired after June 30, 2026, and the Section 179D energy efficient commercial building deduction is not allowed for property the construction of which begins after June 30, 2026. Both changes come from the One Big Beautiful Bill Act, Public Law 119

Under federal tax rules, whether a worker is an employee or an independent contractor depends on the facts and circumstances of the relationship between the worker and the business. The IRS looks at the degree of control and independence in three categories: behavioral control, financial control, and the type of relationship. For a law firm, that means a person's title, a signed agreement, or the way the person is paid does not settle the question on its own. This article exp

Under current IRS guidance, a construction business may be required to file Form 1099-NEC for a 1099 subcontractor when it makes payments in the course of its trade or business for services performed by someone who is not an employee, the payee is not exempt from reporting, and total payments for the year reach the reporting threshold. For payments made in 2026, that threshold is $2,000, and the IRS states it may be adjusted for inflation beginning in 2027. Not every payment

Internal Revenue Code Section 162 generally permits a deduction for ordinary and necessary expenses paid or incurred during the taxable year in carrying on a trade or business. For a law practice, that principle is the starting point for evaluating business expenses for law firms under federal tax law. Two other rules limit the general principle. Personal, living, and family expenses are generally nondeductible under Internal Revenue Code Section 262, and certain capital expe

Operating a medical spa involves expenses ranging from payroll and facility costs to medical supplies, equipment, software, marketing, and professional services. For federal income tax purposes, however, spending money through a business does not automatically make an expense deductible. Understanding med spa tax deductions starts with knowing what the IRS actually allows. The Internal Revenue Service generally allows a business to deduct expenses that are both ordinary and n

For Irvine and Orange County taxpayers, the California return is not a copy of the federal return. California has the highest top income tax rate of any state, taxes capital gains as ordinary income, and does not conform to several federal deductions that reduce federal taxable income. Planning that looks only at the federal return can leave real state-level tax unaddressed. Here is where the two returns diverge and what that means for planning in 2026. California's Rate Stru

Adjusted gross income, the figure on line 11 of Form 1040, is one of the most consequential numbers on a tax return. It is the starting point for taxable income, and it also determines eligibility for credits, deductions, and surtaxes throughout the code. Not every deduction reduces it, though. Understanding which ones do, and which only reduce taxable income, is the foundation of AGI planning. Here is how it works under IRS rules for 2026. What AGI Is, and What It Controls?