TaxConnections


 

Corporate Tax Executives – Why The War For Tax Executive Talent Has Heated Up! (Part I)

This article is written to help tax executives understand what is happening in the market now. It is also written to help CFOs and VPs HR understand what they can do to support their tax organization. Believe it, your tax organization will need a lot more support than you may have given them in the past.  Tax reform has just delivered a big package of surprises no one is really prepared for yet. The tax organizations staffed to study these changes will do far better strategically and financially so now is the time to start putting together a plan of action.

As an example, allow me to share what one of my early career clients did regarding tax planning. During the last major tax reform under President Reagan, an emerging company in Silicon Valley called me to help them find a tax lawyer who would go through the new 1986 Transfer Pricing Tax Legislation , the White Paper and figure out what was in there. They retained me to find a strong researcher and strategic planner to go through the government’s position on newly issued transfer pricing regulations. They wanted to figure out the new rules and how to come up with a strategic long term tax plan to grow their business.  Want to know who this company is?  This company now has annual revenue of 234Billion and is called Apple Computer!

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TaxConnections List of Global Tax Authority Country Representatives With Email Addresses And Numbers – Complimentary Research

We know many of you will appreciate this list of Global Tax Authority Country Representatives along with their names and contact information. This valuable resource will make it easy for you to contact the country tax authorities directly with questions you have in setting up business operations in other countries. Having direct contact information with global tax authority representatives will save you a lot of time!

https://www.taxconnections.com/global-tax-authority-country-representatives

 

 

Do You Want To Be An S Corp?

S corporations are corporations that elect to pass corporate income, losses, deductions, and credits through to their shareholders for federal tax purposes. Shareholders of S corporations report the flow-through of income and losses on their personal tax returns and are assessed tax at their individual income tax rates. This allows S corporations to avoid double taxation on the corporate income. S corporations are responsible for tax on certain built-in gains and passive income at the entity level.

To qualify for S corporation status, the corporation must meet the following requirements:

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More States Impose Sales Tax On E-Commerce Sales

Blake Christian, Tax Advisor, Tax Blog, Long Beach, California, USA, TaxConnections

Over the last few decades, states have had the opportunity to broaden their income and franchise tax base by ensnaring a larger proportion of out-of-state taxpayers in their taxing regime through adoption of broad economic or factor-based economic nexus standards.

However, states have traditionally struggled to do the same with respect to their sales and use tax base because of the long-standing United States Supreme Court nexus decision in Quill Corp. v. North Dakota (1992).” 1 For nearly three decades, the dicta contained in Quill have prevented states from adopting economic-based nexus
standards with respect to sales and use taxes, requiring instead a more stringent physical presence standard (or “substantial nexus”).
The Supreme Court has repeatedly declined to hear challenges or cases related to Quill, until recently. Read More

2017 IRS Data Book Shows Chances Of Being Audited

Ephraim Moss, Tax Advisor, Tax Blog, New York, USA, TaxConnections

The IRS has published the 2017 version of its annual IRS Data Book, which contains statistical information about the IRS and taxpayer activities during the previous year. The IRS Data Book helps illustrate the breadth and complexity of the U.S. tax system. According to the Data Book, during fiscal year 2017 (Oct. 1, 2016 to Sept. 30, 2017), the IRS collected overall more than US$ 3.4 trillion from taxpayers, processed more than 245 million tax returns and other forms, and issued more than $436 billion in tax refunds.

The IRS also audited almost 1.1 million tax returns during fiscal year 2017.  Almost 90% of the audited returns were individual income tax returns. While the percentage of overall returns audited was relatively low at 0.5% overall, the percentages were significantly higher for two types of taxpayers – wealthy individuals and individuals filing international returns. Read More

Navigating The Shoals Of IRS Penalty Abatement – Types Of Defense (Part II)

Now that you may have missed the income tax filing and payment deadline perhaps it is a good time to understand how to cope with penalization as it can get woefully expensive – not to mention mind numbing – if you go about it have baked.

There are a handful of defenses you can attempt to assert when it comes to navigating the shoals of IRS penalty abatement, chose with care and proper counsel.

The key IMHO is to comport yourself with law abiding dignity whilst deliberately navigating through these general options, including: Read More

Tax Professionals – Proposed Presidential Executive Orders Researched For You With Our Compliments

Tax Advisors- you would never know what was hidden in these regulations unless you conduct extensive research which we did for you! We will give you our twenty-five hours of research with links to the Code of Federal Regulations to our members.

Based on a preliminary review, these proposals could be very far reaching and effect a wide range of your clients. These proposals deserve your immediate attention and review!

You should study this very important information to make comments or request a public hearing on areas that may impact you and your clients. If you want to comment or request a public hearing you must do so before May 14, 2018.

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Canada: Capital Cost Allowance For Real Estate

Capital cost allowance (CCA) is the tax term in Canada for the deduction of amortization on capital assets. There are separate classes of CCA for property, plant and equipment and different rates that apply to each class. There are some specific rules for claiming capital cost allowance related to real estate.
Discussion:

Once construction is complete, a building can be sold as inventory and earn business income, used to earn property income, or used to operate an active business. If the building is not being sold, then it will generally become depreciable property for the corporation. In order to be classified as depreciable property, the building must meet the following conditions:

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Newly-Revised Estimated Tax Form And Publication Can Help People Pay The Right Amount

Tom Kerester, Tax Ambassador, Tax Blog, Washington D.C., USA, TaxConnections

WASHINGTON – With tax reform bringing major changes for the year ahead, the Internal Revenue Service today reminded the many self-employed individuals, retirees, investors and others who need to pay their taxes quarterly that the first estimated tax payment for 2018 is due on Tuesday, April 17, 2018.

The Tax Cuts and Jobs Act, enacted in December 2017, changed the way tax is calculated for most taxpayers, including those with substantial income not subject to withholding. Among other things, the new law changed the tax rates and brackets, revised business expense deductions, increased the standard deduction, removed personal exemptions, increased the child tax credit and limited or discontinued certain deductions. As a result, many taxpayers may need to raise or lower the amount of tax they pay each quarter through the estimated tax system. Read More

What Is Wrong With IRS User Fees?

Nina Olson, Tax Advocate, Tax Blog, Washington D.C., USA, TaxConnections

The IRS has been increasing user fees to fund its operations. It recently increased or proposed to increase a wide range of fees including the fees for installment agreements (IAs)offers-in-compromise (OICs)pre-filing agreements (PFAs)private letter rulings (PLRs), and special enrollment examinations (SEE). I raised concerns about these increases in my 2015 and 2017 Annual Reports to Congress.

On Feb. 9, 2018, Congress enacted the Bipartisan Budget Act of 2018 (P.L. 115-123), which addresses concerns about the IRS’s largest fee revenue generator – the IA fee increases. The law prevents the IRS from increasing the IA fee again without legislation. It also requires the IRS to waive or refund the fee for taxpayers with income below 250 percent of the federal poverty level who authorize the IRS to directly debit the IA payments (DDIA) from a bank account or who cannot set up a DDIA (e.g., because they do not have a bank account). This legislation suggests that Congress shares some of my concerns. This blog summarizes our concerns. Read More

Inflation Adjustments Under Recently Enacted Tax Law

Tom Kerester, Tax Blog, Tax Ambassador, Washington D.C., USA, TaxConnections

WASHINGTON — The Internal Revenue Service has updated the tax year 2018 annual inflation adjustments to reflect changes from the Tax Cuts and Jobs Act (TCJA). The tax year 2018 adjustments are generally used on tax returns filed in 2019.

The tax items affected by TCJA for tax year 2018 of greatest interest to most taxpayers include the following dollar amounts: Read More

Curious About Entertainment Tax Rules In The United Kingdom?

Jane Swain, Tax Advisor, Tax Blog, Manchester, United Kingdom, TaxConnections

Eating out can take several different forms:

  1. Taking clients out for meals
  2. Buying refreshments for yourself
  3. Meeting clients/contacts for coffee
  4. Taking you staff out for meals/down the pub

Unfortunately slightly different tax rules apply to each.

Buying Refreshments For Yourself

The rule here is that if the food/drink is associated with travel then it is allowable. So, if you travel to London and stay the night in a hotel for the purposes of business, your evening meal is subsistence and so is a deductible expense. Read More

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