A company that makes a smartphone app may soon be able to claim some of its profits as tax-free.
That’s because of the Tax Cuts and Jobs Act, which would make it possible for small businesses to claim a portion of their profits as income from a tax-deferred account.
In the short term, this would mean that companies would be able claim up to $3,000 of profit as taxable income.
But in the long term, that could mean that some of those profits could be taxed as income.
In a nutshell, this means that a company that sells its smartphone app for free to millions of people will be able take home some of that money.
What this means for the average personIn order to qualify for this benefit, companies that make a smartphone application for free must include a mobile app in their app.
If they don’t, then they can’t claim the tax break.
The app will have to include the company name, address, phone number, and other information that would allow it to claim the $3.99 per person, $1.49 per month, and $0.45 per hour tax break from the new law.
There is no specific provision for the amount of profit a company makes from a phone app, but this could be as much as $10 million per year.
If a company’s iPhone app sells out, it won’t be eligible for the tax breaks.
In the long run, this could potentially mean that a small business that makes the app could be eligible to claim as much of its profit as it would have taken had the app not been sold.
If a small company has already made that profit, then the company will get the $10,000 tax break, even if it does not yet have the app on its smartphone.
What to do if you don’t qualifyThe rules are a bit confusing, but a quick scan of the rules from the IRS will tell you what you need to know.
If you’re not eligible, then you’ll be able’t claim any of your profits.
If your company sells a phone application for $1,000 per person or $1 per month or if your company makes a mobile phone app for $100 per person you can still claim the entire $3 million tax-break.