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News

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  • 05/14/2015
    State Tax Issues Caused By Federal Tax Audits
    By Alan Goldenberg

    For most businesses, the likelihood of being audited by the Internal Revenue Service (IRS) is less than 2%, but ask those who have been through one and the response is always the same – it is a long, gut-wrenching process, no matter how good your records are.

Publications

  • 08/23/2017
    Tax Tips: Home Sale Exclusion and Tax-Free IRA for Kids

    These brief tips discuss how the IRS now views the unexpected birth of a child an "unforeseen circumstance" when it applies to the home sale exclusion and also explains how children can take advantage of a tax-free Roth IRA. Home sale exclusion: Unexpected birth is “unforeseen circumstance” The unexpected birth of a...

  • 08/23/2017
    Cash vs. Accrual: Are You Using the Right Accounting Method?

    Which accounting method should your business be using for tax purposes? Many business owners are surprised to learn that they have a choice. True, certain businesses are required to use the accrual method, but you’d be surprised how many businesses are eligible for the cash method. If you have the...

  • 08/23/2017
    What’s New in Tax Reform?
    By Michael J. Greenwald, MPPM, CPA, Partner

    With the last major tax overhaul taking place more than thirty years ago, it’s time to modernize the tax code so it works for businesses and individuals in the 21st Century. However, the tax code is complex and reform is a tricky subject for Congress — the slightest change is...

  • 08/23/2017
    For Surviving Spouses: It’s Not Too Late to Elect Portability
    By Scott Testa CPA, JD, Partner 

    If you missed the filing deadline to elect portability and increase your federal gift and estate tax exclusion, there's still time. A recent Internal Revenue Services (“IRS”) Revenue Procedure, Rev. Proc. 2017-34, provides a simplified, less expensive way to get an extension, make the election and reap substantial tax savings. This...

  • 06/26/2017
    Tax Tips

    These brief tips explain why it’s important to obtain a contemporaneous written acknowledgment when substantiating a charitable deduction; detail a court case involving the mortgage interest deduction; and cover why a cash balance plan may be the answer for business owners who have fallen behind on retirement plan contributions. Charitable deductions:...

  • 06/26/2017
    You can’t take it with you

    Making the most of tax carryovers

  • 06/26/2017
    What Is This Thing Called “Use Tax”?
    By Tom Corrie, JD, LLM, Principal

    Perhaps one of the most misunderstood areas in the state and local tax field is that of “use tax.” Most people comprehend the concept of sales tax— that when taxable property or a taxable service is purchased, forty-five of the fifty states impose a tax upon the retail sale of...

  • 06/26/2017
    Business Traveling Tax Wisely
    By Liz McGrath, International Tax Director 

    Did you know that employers can deduct employees’ travel expenses, including amounts for meals and lodging, if both the employer and the employee carefully follow the tax rules? Conversely, if the rules are not followed, the expenses will be taxable to the employee and fully subject to FICA and payroll...

  • 05/24/2017
    Decoding State Tax Nexus for Foreign Companies
    By Alan Goldenberg, JD, MBA, LLM

    In order for a state to legally impose its taxes upon an out-of-state entity, nexus – a connection between the income producing company and the state – must exist. Nexus laws, which may vary from state to state, can be particularly troublesome for foreign companies who often overlook these complex...

  • 05/24/2017
    Sales and Use Tax when Purchasing Art
    By Tom Corrie, JD, LLM, Principal

    Sales and use tax considerations can be quite complex, and when applied to the purchase of high-end art, these taxes can add up to a hefty sum. During the course of our everyday practice, our clients regularly ask us to address tax issues regarding the purchase and sale of artwork....

  • 04/25/2017
    Timing Compensation in a Changing Tax Climate

    All eyes on Sec. 409A

  • 04/25/2017
    Tax Tips

    Standard mileage rates can lead to inaccurate reimbursements

  • 02/21/2017
    A Truly Laden Cross to Bear: The Crushing Tax Burdens of New York

    It comes as no surprise to New Yorkers that year after year, numerous tax studies conclude that they face some of the highest tax burdens in the United States. Multiple reports released in 2016 found that on a regular basis almost 13% of a New York City resident’s income is...

  • 02/21/2017
    Tax Tips: Avoiding Tax Scams, Using Charitable Trust for College Expenses

    These brief tips cover scams to be aware of during tax season, how to check your IRS account online and the benefits of using a charitable trust to cover college expenses. Watch out for tax scams With tax season in full swing, criminals posing as IRS officials are stepping up their efforts...

  • 02/21/2017
    VIDEO: Navigating Difficult Decisions

    Tax Partner, Kim Dula discusses the psychological and emotional aspects of transitioning the family business. ...

  • 12/12/2016
    Tax Tips

    These brief tips cover how the IRS has made it easier for taxpayers to obtain an extension for retirement plan rollovers, ways to protect taxpayers from charity scams and how to make a partial disposition election for disposed property. Late rollover relief just got easier It’s possible to withdraw funds from an...

  • 12/12/2016
    Business Tax? But I’m Unincorporated!
    By Alan Goldenberg, JD, MBA, LL.M

    Businesses are often surprised to learn of the New York City Unincorporated Business Tax (UBT), an entity-level tax imposed on unincorporated businesses operating within the City. Many businesses presume that as pass-through entities, such as limited liability companies, taxes are never due by the entity. Rather, the tax liabilities are...

  • 10/10/2016
    Year-end tips for reducing NIIT

    As 2016 winds down, it’s time for many people to begin thinking about taxes. One tax you may want to focus on is the net investment income tax (NIIT). This tax adds 3.8% to individual income tax rates. Here are several year-end planning strategies to consider that can reduce or...

  • 10/10/2016
    Is it time to revisit the research credit?

    If your business hasn’t been claiming the research credit (often referred to as the “research and development,” “R&D” or “research and experimentation” credit), now may be a good time to revisit this valuable tax break. Last year’s Protecting Americans from Tax Hikes (PATH) Act made the credit permanent after 34...

  • 10/10/2016
    Major Presidential Candidates: What Are Their Tax Proposals?
    By Robert Charron, CPA and Andrew Cohen, JD, LL.M

    Our next president may have the opportunity to enact significant federal tax reform. This begs the question: How do Donald Trump and Hillary Clinton differ on proposed tax changes? Not surprisingly, the differences are significant, particularly as to who would benefit, who would be harmed, and the effect on our...

  • 10/10/2016
    Statutory Residency – The Whys and Wherefores
    By Tom Corrie, JD, LLM, Principal

    The scenario is generally the same. I receive a call from a taxpayer who has just been informed by the New York State Department of Taxation and Finance (the “Department”) that they have been selected to undergo a personal income tax audit. The individual is commonly a non-resident of New...

  • 08/03/2016
    The Work Opportunity Tax Credit: Don’t Overlook as Your Workforce Expands
    By By: Andrew S. Cohen, JD, LL.M

    Do you plan to expand your work force? If so, the Work Opportunity Tax Credit (WOTC) is a federal nonrefundable tax credit that provides an incentive for hiring individuals that have faced certain barriers to employment. The Protecting Americans from Tax Hikes Act (PATH) recently extended the availability of the...

  • 08/03/2016
    Partnerships: Get ready for new audit rules

    For partnerships, including limited liability companies taxed as partnerships, new audit rules are a game changer. The rules apply to returns for partnership tax years that begin after December 31, 2017, including amended returns. The changes aren’t merely procedural; they substantially alter the taxation of partnerships, effectively imposing entity-level taxes...

  • 08/03/2016
    Tax Tips: Capital Gains; Bad Debt; Net, Net Gifts

    This issue’s “Tax Tips” article details why taxpayers should consider giving appreciated stock to their children to minimize capital gains taxes, explains how to deduct bad debt and covers why “net, net gifts” are now a more viable strategy. Shift capital gains to your children Giving appreciated stock or other investments to...

  • 07/18/2016
    I Am Being Audited For Commercial Rent Tax – Will You Help Me?
    By Tom Corrie, JD, LLM, Principal 

    A Common Problem Recently, I received a call from a gentleman who had been doing business in New York City for over 30 years. He had just been contacted by the New York City Department of Finance (the “Department”) about his business’ potential Commercial Rent Tax (“CRT”) obligations. He knew nothing...

  • 06/16/2016
    Challenges with Sales Tax Compliance
    By Alan Goldenberg, JD, MBA, LLM

    Some of the biggest compliance challenges facing taxpayers are not found with income taxes, but rather with sales tax. Properly computing, collecting and remitting sales tax in the 45 states that levy such a tax is often highly burdensome and draining on a business’s resources. After income and property taxes,...

  • 06/16/2016
    Sourcing of Service Revenue, Can New York State and City Make It Any Harder?
    By Tom Corrie, JD, LLM, Principal

    Recently, both New York State (the “State”) and New York City (the “City”) have modified the methods prescribed with respect to how service revenue should be sourced. Applicable for tax years beginning on or after January 1, 2015, both the State and City have moved from a cost of performance...

  • 06/16/2016
    Deduct Now, Donate Later

    Donor-advised funds offer significant benefits

  • 06/16/2016
    Is it Time to Revisit Captive Insurance?

    Many businesses, both large and small, use captive insurance companies to meet their risk management needs while controlling costs and reducing taxes. Recent developments have created new opportunities to take advantage of captives. At the same time, new restrictions designed to curb perceived abuses of “microcaptives” may require some companies...

  • 06/16/2016
    Why You May Need a Prenup

    Prenups usually become relevant when a couple gets divorced. But they also provide several benefits for successful marriages, including protection from liability for your spouse’s separate debts and implementation of estate planning strategies. Most states give a surviving spouse certain rights to a deceased spouse’s property. In community property states, for...

  • 06/16/2016
    Tax Tips

    Take another look at the research credit

  • 04/20/2016
    Gifts and the Applicability of New York Transfer Taxes
    By Alan Goldenberg, JD, MBA, LLM

    Although I have previously discussed the conceptual framework of the New York State Real Estate Transfer (RETT) and the New York City Real Property Transfer (RPTT) taxes in a recent article in this publication, just to summarize both the State and City impose certain transfer taxes on conveyances of real property...

  • 04/20/2016
    Communication Gap: The Kovel Letter and Client to Accountant Communication
    By Scott B. Ehrenpreis, Principal

    The client-accountant communication has limited privilege under the current Tax Code. In non-criminal tax matters, privilege applies to any communication that would be considered privilege if it were between the taxpayer and an attorney. In criminal tax matters, no privilege applies to communication between the client and their accountant. Due to...

  • 04/20/2016
    5 retirement account tax traps to avoid

    If you’re like most people, a large portion of your wealth is set aside in individual retirement accounts (IRAs) or qualified retirement plans, such as 401(k) or profit-sharing plans. These accounts offer substantial tax advantages, but they’re also fraught with traps for the unwary. Here are five common mistakes to...

  • 04/20/2016
    Property dividends: Handle with care

    Corporate shareholders sometimes receive distributions in the form of property rather than cash. And while there’s nothing wrong with this practice, it’s important to understand the tax implications. Tax treatment of distributions The tax rules surrounding corporate distributions are complicated, and a full discussion of them is beyond the scope of this...

  • 04/20/2016
    The Section 1031 exchange

    Why it’s such a great estate planning tool

  • 04/20/2016
    Tax Tips

    Are your employees classified correctly?

  • 02/09/2016
    Nonresident Pass-Through Withholding

    When it comes to taxes, residency may have a bigger impact than you think. Taxpayers are generally acquainted with the tax withholding requirements imposed on their wage income, but are less familiar with the ways in which states impose withholding on pass-through entity income. While states typically tax their residents’...

  • 02/09/2016
    Employee or Independent Contractor – An Old Question Revisited

    Perhaps nothing causes more consternation among small and mid-sized business owners than the employee versus independent contractor problem. Generally, the issue surfaces when an audit notice from the State Department of Labor arrives in the mail, as the result of an individual applying for unemployment benefits. The company’s position is...

  • 02/09/2016
    Designing a tax-wise bonus plan

    An annual bonus plan can be a great way to attract, retain and motivate employees. And if the plan is designed carefully, you can deduct bonuses earned this year even if you don’t pay them until next year. Sound interesting? Read on. The 2½ month rule Many employers assume they can deduct...

  • 02/09/2016
    The Net Investment Income Tax

    Planning opportunities for small business owners

  • 02/09/2016
    Need to protect your assets? Consider a BDIT

    A BDIT, also known as the “Beneficiary Defective Inheritor’s Trust,” is one of the most powerful estate tax and asset protection strategies available to taxpayers. Essentially, it’s a third-party settled trust designed to give the taxpayer (who is both a trustee and the initial primary beneficiary of the trust) control...

  • 02/09/2016
    Tax Tips

    Thinking about expatriation? Watch out for the “exit tax”

  • 11/11/2015
    5 last-minute tax-planning ideas

    Tax planning is a year-round endeavor, but several year end strategies might reduce your 2015 tax bill.Here are five to consider: 1. Defer income, accelerate deductions. You may be able to lower your 2015 income taxes by deferring income to 2016 or accelerating deductions into 2015. To defer income, for example,...

  • 11/11/2015
    Need a financial backup plan?

    Why you should consider a SLAT

  • 11/11/2015
    Solving the play-or-pay conundrum

    For 2015 and after, employers retaining at least a certain number of employees (generally 50 full-time employees or a combination of full-time and part-time employees) will be subject to the employer shared-responsibility provisions under Section 498OH of the Internal Revenue Code — added to the Code by the Affordable Care...

  • 11/11/2015
    Tax Tips

    Beware the passive foreign investment company Have you considered investing into an investment partnership that invests in PFICs? If so, think twice. The rules for such investments are very onerous, and apply to many foreign investments. A foreign corporation is a PFIC if 1) 75% or more of its gross income is...

  • 11/10/2015
    Use Tax Increasingly Important for Taxpayers
    By Alan Goldenberg, JD, MBA, LLM

    Ignorance is bliss is a mantra for many taxpayers when it comes to compliance and tax obligations. When contacted by taxing authorities, taxpayers often respond with stories, no matter how unreasonable, that they had no knowledge of the particular tax or that any tax was due. Much of the time...

  • 11/10/2015
    Uncovering the Importance of Responsible Person Liability
    By Tom Corrie, JD, LLM, Principal, Director of State and Local Tax

    Perhaps there is no area of state and local tax law that is more perplexing to businesses than sales and use tax. Forty-five states, plus the District of Columbia, impose sales and use tax. Moreover, many of those jurisdictions authorize localities within their borders to impose their own sales and...

  • 09/09/2015
    Safe Harbor for Routine Service Contracts Expense
    By Michael J. Greenwald, Partner, Friedman LLP

    Vincent van Gogh is quoted as saying that, “great things are done by a series of small things brought together.” Apparently the IRS thinks so too. A recent revenue procedure offers a safe harbor to accrual basis taxpayers – allowing them to ratably deduct the cost of regular and routine...