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ProConnect Lacerte Notifications - Lacerte Tax Year 2018 Tax Reform Information and Updates

This announcement page will be updated each time new information is available regarding updates to the Lacerte Tax program in relation to the Tax Year 2018 Tax Reform.

This announcement can be 'followed' in order to receive an email notification each time a new item is posted.

Please click the following link for instructions to set up your email notifications: https://accountants-community.intuit.com/articles/1635808&src=lsccom

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4 updates

Previous Tax Reform Posts

July 26, 2018: IRS Tax Tip 2018-115  - Resources on IRS.gov Help All Taxpayers Understand Tax Reform

  • Tax Reform Web Page. The Tax Reform page highlights what taxpayers need to know about the tax law changes and how these changes affect them. This page also links taxpayers and tax professionals to news releases, tax tips, publications, notices, and legal guidance related to the legislation.
  • Updated Withholding Calculator. The IRS encourages everyone to use the Withholding Calculator to perform a “Paycheck Checkup,” which is even more important this year because of the tax law changes. The calculator helps taxpayers determine if they’re having the right amount of tax withheld from their paychecks.
  • Updated Form W-4, Employee’s Withholding Allowance Certificate. Taxpayers who determine they need to make changes to their withholding can complete a Form W-4, which reflects the tax law changes. Employees will submit the completed Form W-4 to their employers.
  • Frequently Asked Questions. The IRS posted new FAQs to help people understand how to use the Withholding Calculator and the changes to the Withholding Tables.

This IRS Tax Tip is available on the IRS website: https://www.irs.gov/newsroom/resources-on-irsgov-help-all-taxpayers-understand-tax-reform

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July 31, 2018: Just a friendly reminder that the Intuit ProConnect Tax Pro Center is continually updated with new information.  With Tax Year 2018 quickly approaching, we want to make sure you have the most current information in one convenient location.  https://taxprocenter.proconnect.intuit.com

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August 24, 2018: The following FAQ article will be updated throughout the season with new information regarding Tax Reform for Tax Year 2018.  

Of course, any new information added to this article will be posted here as well to make sure you're notified immediately.

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2018 Tax Reform - Frequently Asked Questions: https://accountants-community.intuit.com/articles/1747682&src=lsccom

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August 31, 2018: The following article will be updated as new information is available.  

2018 Individual and Business Tax Reform - Summary of Changes: https://accountants-community.intuit.com/articles/1748911&src=lsccom

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September 7, 2018: The following article has been added for TY 2018 program input changes and can also be found in the "2018 Individual and Business Tax Reform - Summary of Changes" article.

2018 Tax Reform - Moving Expenses:  https://accountants-community.intuit.com/articles/1750164&src=lsccom

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September 7, 2018: The following article has been added for TY 2018 program input changes and can also be found in the "2018 Individual and Business Tax Reform - Summary of Changes" article.

2018 Tax Reform - Personal Casualty Losses Deduction: https://accountants-community.intuit.com/articles/1750205&src=lsccom

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September 11, 2018: The following article has been added to quickly determine individual state conformity status to Section 965 Transition Tax.  Additional product specific information will be included when available.

State Conformity to Federal Section 965 Transition Tax:  https://accountants-community.intuit.com/articles/1747665&src=lsccom

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September 12, 2018: 

Pennsylvania Corporate has revised an existing Form REV-798 (2 new lines) and added a new Form REV-798 A in response to Section 965 repatriated income changes at the Federal level. Form REV-798 A is a worksheet that computes amounts for one of the new lines on the REV-798.

Minnesota Section IRC 965 Informational Diagnostics Introduced.

North Dakota IRC §965 - deemed repatriation of foreign income.

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September 20, 2018:  Are you interested in Lacert Live and Recorded webinars available in preparation of Tax Year 2018?  If so, check out our training center: https://proconnect.intuit.com/training/lacerte/

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October 18, 2018:  Qualified Business Income (QBI) Resources

The Following Articles are Frequently Asked Questions Regarding -  Qualified Business Income (QBI):

https://accountants-community.intuit.com/articles/1756609&src=lsccom 

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November 2, 2018: 

The Tax Cuts and Jobs Act (TCJA) established additional limitations on the deductibility of certain business meals and entertainment expenses.  Under the act, entertainment expenses incurred or paid after December 31, 2017 are nondeductible unless they fall under the specific exemptions in Code Section 274(e).  For your convenience, we have provided a comprehensive chart to summarize proper treatment for many types of meals and entertainment expenditures, under the law applicable both before and after the act.  To review the recent IRS guidance on Meals and Entertainment business expense deduction, see Notice 2018-76

Meals and Entertainment Changes Under Tax Reform:  https://accountants-community.intuit.com/articles/1777005&src=lsccom 

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November 5, 2018:

Form 2106 - Suspension of Miscellaneous Deductions Subject to the 2% Floor Under Section 67(a) and Disallowed Entertainment Expenses

  • For taxable years, beginning after December 31, 2017, and before January 1, 2026, miscellaneous itemized deductions subject to the 2% floor under section 37(a) will be suspended.
  • Employees who are not (1) armed forces reservists, (2) qualified performing artists, (3) fee-basis state or local government officials, and (4) employees with impairment-related work expenses may not use Form 2106.
  • Entertainment expenses will be disallowed after December 31, 2017.
  • Form 2106-EZ has been retired for Tax Year 2018.

Tax Reform - Employee Business Expense Form 2106:  https://accountants-community.intuit.com/articles/1777948&src=lsccom

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November 8, 2018:

Kiddie Tax Changes - Children (under 18) with unearned income over $2,100 required to file Form 8615 are no longer taxed at their parents' tax rate. Instead, they will be taxed at fiduciary rates.

Tax Reform - Tax for Certain Children Who Have Unearned Income (8615): https://accountants-community.intuit.com/articles/1778617&src=lsccom


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November 21, 2018

Publication 5307, Tax Reform Basics for Individuals and Families, is a key resource to understanding the impact of the tax reform law on deductions. The publication provides information about:

  • increasing the standard deduction,
  • suspending personal exemptions,
  • increasing the child tax credit,
  • adding a new credit for other dependents, and
  • limiting or discontinuing certain deductions.

IRS  Publication 5307 Tax Reform Basics for Individuals and Families 

Resource: IRS Newswire IR-2018-230

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December 26, 2018

Lacerte Simplified QBI Worksheet and QBI Calculations - Information Update December 21

Current Version Note (39.0103):  The current version of 2018 Lacerte includes the simplified worksheet computation only.  This worksheet will only generate if the taxpayer’s taxable income is below the phase-in threshold ($315,000 MFJ and $157,500 for all others). If their taxable income is higher, they will be required to use the complex worksheets which have not been released in Lacerte, yet. In this situation, we will not generate any worksheets or calculate any amount on Form 1040, line 9.  The complex worksheets were released by IRS in DRAFT form in Publication 535 on December 19, 2018.

We are actively working the complex QBI computations and plan to include these in the January 9 scheduled program release. For a complete list of program update release dates, see 2018 Lacerte Release Availability and Dates: 2018 Lacerte Release Availability and Dates 

In general, we will take the income from Schedule C, F and passthrough K-1s on Schedule E, along with any ordinary gains from the disposition of business property linked to those schedules, and try to automatically calculate the QBI. According to Publication 535 (draft date Dec 19, 2018), page 2, rental properties do not rise to the level of trade or business and will not automatically be included as QBI.  However, the Schedule E rental input screen, in the QBI section, will include the ability to include rental QBI income in the calculation.     

To perform tax planning, please use the Lacerte Tax Planner, which includes all the QBI calculations and limitations. Export the client from the 2017 Lacerte Tax program to the Tax Planner, to create a base year for planning. 

2018 Lacerte Release Availability and Dates: https://accountants-community.intuit.com/articles/1738593&src=lsccom

Lacerte Simplified Worksheet Section 199A - Qualified Business Income Deduction:  https://accountants-community.intuit.com/articles/1785802&src=lsccom

2018 Draft Publication 535: www.irs.gov/pub/irs-dft/p535--dft.pdf

January 10, 2019

Lacerte Complex Worksheet Section 199A - Qualified Business Income Deduction: https://accountants-community.intuit.com/articles/1788193&src=lsccom

January 10, 2019

New in Tax Year 2018 - Tax Reform Impact Summary: https://accountants-community.intuit.com/articles/1753064&src=lsccom

IRS waives penalty for many whose tax withholding and estimated tax payments fell short in 2018

IR-2019-03

The Internal Revenue Service announced today that it is waiving the estimated tax penalty for many taxpayers whose 2018 federal income tax withholding and estimated tax payments fell short of their total tax liability for the year.

The IRS is generally waiving the penalty for any taxpayer who paid at least 85 percent of their total tax liability during the year through federal income tax withholding, quarterly estimated tax payments or a combination of the two. The usual percentage threshold is 90 percent to avoid a penalty.

The waiver computation announced today will be integrated into commercially-available tax software and reflected in the forthcoming revision of Form 2210 and instructions.

This relief is designed to help taxpayers who were unable to properly adjust their withholding and estimated tax payments to reflect an array of changes under the Tax Cuts and Jobs Act (TCJA), the far-reaching tax reform law enacted in December 2017.