Properties and homes that are only used for the enjoyment of the owners and guests that are not held out as a rental property may be subject to an additional tax on the value of the property – Impuestos de Lujo or luxury tax. The luxury tax is based on the declared value of theRead more about Tax Compliance on Luxury Taxes[…]
Author: relanetAdmin
Tax Compliance on Costa Rican Rentals
In Costa Rica, residential rental activity is subject to taxation. Depending on the nature of the rental, it may be subject to sales tax, income tax or both. All short-term rentals are subject to sales and income taxes, The definition of a short-term rental is still a bit unclear from an amount of time orRead more about Tax Compliance on Costa Rican Rentals[…]
Don’t Neglect Estate Planning
The federal estate tax exemption now exceeds $11 million per person. Accordingly, few individuals or married couples will owe this tax. Nevertheless, there is more to successful wealth transfer than reducing or eliminating estate tax. Ideally, you’ll want your assets to pass to the desired recipients with a minimum of turmoil and expense.
More Gift in the Gift Tax
The Tax Cuts and Jobs Act of 2017 increased the federal estate tax exemption to $11.18 million for 2018. That’s per person, so the combined exemption for a married couple can be as much as $22,360,000 worth of assets this year.
Beat Market Volatility with a Retirement Bucket Plan
We have seen an increase in market volatility in early 2018. A steep pullback in stocks could be good news for working people who are building retirement funds, but those approaching or in retirement might be hurt.
Read more about Beat Market Volatility with a Retirement Bucket Plan …
IRS Okays Home Equity Deductions
The Tax Cuts and Jobs Act of 2017 affected the tax deduction for interest paid on home equity debt as of 2018. Under prior law, you could deduct interest on up to $100,000 of home equity debt, no matter how you used the money. The old rule is scheduled to return in 2026.
The bad news is that you now cannot deduct interest on home equity loans or home equity lines of credit if you use the money for college bills, medical expenses, paying down credit card debt, and so on. The good news is that the IRS has announced “Interest on Home Equity Loans Often Still Deductible Under New Law.” (See IRS Information Release IR-2018-32.)
No Tax Deductions for Business Entertaining
The Tax Cuts and Jobs Act (TCJA) of 2017 lowered corporate tax rates from a graduated schedule that reached 35% to a 21% flat rate. However, many business expenses are no longer tax deductible. That list includes all outlays that might be considered entertainment or recreation.
Read more about No Tax Deductions for Business Entertaining …
New Tax Law Will Change Divorce Tactics
When couples divorce, financial negotiations often involve alimony. The tax rules regarding alimony were dramatically changed by the Tax Cuts and Jobs Act (TCJA) of 2017, but existing agreements have been grandfathered. In addition, the old rules remain in effect for divorce and separation agreements executed during 2018. Beginning next year, the rules will change, and the roles will be reversed.
Using Illegal Providers
Many of you when you engage a professional to manage your property or otherwise perform services for you, you assume that they are legal to work in Costa Rica. But, the truth is that many providers are not legal and do not operate as such. You must be careful when using these kinds of providers.Read more about Using Illegal Providers[…]
Property Managers – Tricks
Do you rent your property? Do you use a property manager? If yes, then this information is for you. You may be thousands of miles from your property location and you are reliant on a person who is supposed to take care of your property. Do you trust them? How do you know they areRead more about Property Managers – Tricks[…]