Business owners get IRS rules on 20 percent tax break

Business owners — and their accountants — can rest a bit easier: the IRS has given them the long-anticipated final word on how they can claim one of the biggest perks in the 2017 Republican tax overhaul.

An IRS office building in East Harlem

The regulations detailing the new 20 percent deduction for pass-through business owners are of critical importance to the operators of such entities, who range from mom-and-pop convenience store owners to private equity investors.

The regulations, issued on Friday despite a partial government shutdown that has many Internal Revenue Service employees on furlough, can cut their tax bills by up to one-fifth, but also govern what many say is one of the most complex changes in President Donald Trump’s tax law.

The IRS made a series of changes to make it simpler for businesses to determine if they can or can’t get the tax break, a senior Treasury official said on a call with reporters.

Veterinarians, for example, don’t qualify for the deduction, but rental real estate owners that spend at least 250 hours a year involved with the business can get the deduction, according to the IRS guidance.

With assistance from Lynnley Browning

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