2016 Business Year-End Planning
Year-end planning for businesses is particularly important this year given the large number of recent tax law changes that offer new tax savings opportunities and increased certainty about breaks that have been set to expire in recent years. It seems every year we are faced with a long list of business tax breaks that have either recently expired, or are scheduled to expire in the near future. Fortunately, the Protecting Americans From Tax Hikes Act Of 2015 (the PATH Act) has made many (but not all) of these business tax breaks permanent.
September 7, 2016/Tax, Family Wealth
Private Client Services Proposed Regulation Change
Gift or estate taxes (and possibly generation skipping taxes) are imposed on the value of all property transferred during life and at death. New proposed regulations regarding estate planning and valuation discounts were released on August 2, 2016, and if they become final, would significantly impact the availability of minority interest and lack of control discounts for transfers of privately held business interests among family members. In general, the effective date of these new regulations will be the date the regulations are published as final (which is expected to occur in the spring of 2017). It is imperative that clients wishing to transfer interests in closely held businesses to family members complete the transactions this year to avoid the application of the potential new rules.
June 24, 2016/Not-For-Profit, Tax
11 Risks Hidden In Your Form 990
As watchdog groups and other stakeholders continue to expect increased transparency from nonprofits, it’s become all the more important for organizations to prepare Form 990 as accurately and completely as possible. These publicly available forms can expose organizations to public scrutiny, but they can also leave the door open for preventable penalties from the IRS and state and local taxing authorities. Read the list below to learn about some of the hidden pitfalls in your Form 990 that you may never have noticed, but need to address.
Year-End Tax Planning for Businesses
It’s that time of year when businesses should consider year‐end planning strategies. This task is particularly challenging for 2015 due to the long list of popular, temporary business tax breaks that expired at the end of 2014. In the past, Congress has retroactively extended the vast majority of these tax breaks after they expired. However, as we complete this letter, Congress has not passed legislation to extend the expired provisions.
NEW INFORMATIONAL REPORT FOR CORPORATE TAXPAYERS
The North Carolina legislature is looking at potentially changing the way corporate taxpayers allocate income to North Carolina. The Revenue Laws Study Committee is looking at the revenue effect of changing the sales factor under current law to a market-based sourcing methodology. To assist the committee in measuring the revenue effect of market-based sourcing, every corporate taxpayer that has apportionable income greater than $10 million must file Form CD-400 with the state by April 15, 2016. There’s a $5,000 penalty if you miss this filing deadline!
REPAIR, MAINTENANCE, AND INSTALLATION CHARGES
The North Carolina Department of Revenue has issued three important notices regarding repair, maintenance, and installation charges. Effective March 1, 2016, the general NC sales tax rate will apply to the gross receipts derived from repair, maintenance, and installation services sold at retail. In addition, installation charges by a retailer for tangible personal property, certain digital property, and taxable services, are subject to the applicable sales and use tax rate for the item, even though the installation charges may be separately stated by the retailer. For sales prior to March 1, 2016, a sales and use tax exemption was provided for the separately stated portion of the sales price for installation charges on the invoice.
IRS Raises Tangible Property Expensing Threshold to $2,500
The IRS has announced an increase, from $500 to $2,500, in the de minimis safe harbor limit for taxpayers that don’t maintain an applicable financial statement (AFS). According to IRS, this change will simplify the paperwork and record keeping requirements for small business and other taxpayers.
2015 YEAR-END INDIVIDUAL INCOME TAX PLANNING
With the end of the year approaching, it’s time to once again review year-end tax planning strategies that could reduce your 2015 taxes. Year-end planning is particularly challenging this year because a host of popular individual tax breaks expired at the end of 2014. In previous years, Congress has retroactively extended the vast majority of these temporary tax breaks after they expired. However, as we complete this letter, Congress has not yet extended these tax provisions.
2015 YEAR-END CORPORATE/BUSINESS INCOME TAX PLANNING
It’s that time of year when businesses should consider year-end planning strategies. This task is particularly challenging for 2015 due to the long list of popular, temporary business tax breaks that expired at the end of 2014. In the past, Congress has retroactively extended the vast majority of these tax breaks after they expired. However, as we complete this letter, Congress has not passed legislation to extend the expired provisions.
Surface Transportation Act of 2015: Tax Provisions
An eleventh-hour temporary extension of federal highway and transportation spending is partially paid for by new tax compliance requirements. The Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 (H.R. 3236) was approved by the House, 385 to 34, on July 29, and the Senate on July 30, by a 91-4 margin.
