The New 30% Business Interest Limitation of Section 163(j): A Practical Approach including Planning (Currently Unavailable)
Author: Greg White
| CPE Credit: |
2 hours for CPAs
2 hours Federal Tax Law Updates for EAs and OTRPs
2 hours Federal Tax Updates for CTEC |
The proposed regulations that cover the new 30% business interest limitation are over 400 pages long. But the regulations affect almost all our practices; even though who receive a Form K-1 from a partnership that shows “Excess business interest” on line 13, code K.
CCH will guide you through the maze with this two-hour CPE course taught by Greg White, CPA. This course will get you up to speed on how to apply the new business interest expense limitations.
Publication Date: August 2019
Topics Covered
- Computation of Limit (if Subject to §163(j))
- Why? What Prompted §163(j)
- Calculating the Limit
- ATI—Adding Back Depreciation
- Gain on Sale of Assets — A Possible Cure But No "Double Counting"
- Definitions
- "Exempt" and "Excepted" Businesses
- "Exempt" Businesses: Two Hurdles
- "Excepted" Businesses
- "Excepted" Real Property Businesses: Electing Out of §163(j)
- Real Property Election Not Allowed
- Farm Businesses
- Mechanics of the Election
- Looking Down the Road—Forever is a Long Time
- What to Provide if Passthrough Not Subject to §163(j) But Partners Might Be
- Entities That Are Subject to §163(j): "Siloed" Interest Expense
- Untethering Siloed Interest Deductions Partnership
- Basis Reduction: Partners and S corp S-H's
- Entities No Longer Subject to §163(j)—Flushing the Silo
- The 11-Step Computation
Learning Objectives
- Recognize and apply the rules to determine which clients are subject to §163(j)
- Recognize and apply strategies to reduce the impact of the interest limits
- Identify how to complete Form 8990
- Differentiate circumstances where real estate and farming businesses should make the election out of the interest limitation rules
- Recognize what represents a common adjustment that is deducted to arrive at ATI, when computing the business interest expense
- Identify which type of income is excluded from business interest income
- Describe which organizations requested a waiver from the syndicate rule
- Recognize correct statements with respect to switching to ADS
- Identify the ADS period for farm buildings
- Recognize due dates and calculations
- Identify the 2019 small business gross receipts test limit
- Recognize which rule the AICPA requested a waiver from
- Identify one of the businesses excluded from the §163(j) limit
- Describe which property's depreciation is generally not impacted from the switch to ADS
- Differentiate true statements with respect to making the election
- Describe the 11-Step Computation
Level
Update
Instructional Method
Self-Study
NASBA Field of Study
Taxes (2 hours)
Program Prerequisites
Basic understanding of federal income taxation concepts.
Advance Preparation
None
