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Archive for North America

California State Tax Filing Season Is Officially Open – Part V

The Franchise Tax Board (FTB) announced it is now accepting 2013 state tax returns. Also, the FTB provides the following updates on law changes and filing services brought to you in this blog series – Part V.

AB 93 replaces the G-TEDA tax incentives with the New Employment Credit (NEC), the California Competes Credit, and statewide partial sales and use tax exemption for certain manufacturing and research and development equipment.

The New Employment Credit (NEC) is a California income tax credit available to employers for taxable years beginning on or after January 1, 2014, and before January 1, 2021. To obtain a credit a qualified taxpayer must hire a qualified full-time employee on or after Read more

California State Tax Filing Season Is Officially Open – Part IV

The Franchise Tax Board (FTB) announced it is now accepting 2013 state tax returns. Also, the FTB provides the following updates on law changes and filing services brought to you in this blog series – Part IV.

Tax Tips

• Volunteer Income Tax Assistance – Starting in February, free tax help is available through the Volunteer Income Tax Assistance and Tax Counseling for the Elderly Programs (VITA/TCE). Trained volunteers at more than 1,000 sites throughout California provide free help to complete tax forms for low-income, senior, disabled, and non-English speaking persons who need to file simple federal and state tax returns. Read more

California State Tax Filing Season Is Officially Open – Part III

The Franchise Tax Board (FTB) announced it is now accepting 2013 state tax returns. Also, the FTB provides the following updates on law changes and filing services brought to you in this blog series – Part III.

Filing Information

Free Do-it-Yourself Services – FTB encourages taxpayers and practitioners to explore its many self-service applications available through FTB’s website:

• CalFile makes filing easier – CalFile is one of FTB’s free, easy-to-use e-file options available to more than 6.4 million taxpayers. CalFile accepts taxpayers with income of up to $345,235, itemized deductions, and some tax credits. Read more

California State Tax Filing Season Is Officially Open – Part II

The Franchise Tax Board (FTB) announced it is now accepting 2013 state tax returns. Also, the FTB provides the following updates on law changes and filing services brought to you in this blog series – Part II.

2013 Short Sellers Get State Tax Relief – According to an IRS Information Letter dated September 19, 2013, the IRS has determined that California taxpayers who sell their principal residences where the lender agrees to a short sale for less than what is owed on the home are relieved of incurring cancellation of indebtedness income, which may have been taxable. Instead, the amount of cancelled debt is included in the amount realized in determining gain on the sale of that residence. Read more

California State Tax Filing Season Is Officially Open – Part I

The Franchise Tax Board (FTB) announced it is now accepting 2013 state tax returns. Also, the FTB provides the following updates on law changes and filing services brought to you in this blog series – Part I.

What’s New for Individuals

Standard deduction – The standard deduction for single or filing separately tax statuses increased to $3,906. For joint, surviving spouse, or head of household filers, it increased to $7,812.

Exemption credit increases – The dependent exemption credit increased to $326 per Read more

Learn The Real Facts: Unresolved US Tax Liabilities, Re-Entry To USA, Renewal Or Revocation of Your US Passport

There is a lot of misinformation on the internet nowadays on this topic. While overseas Americans must be careful not to fall prey to, what I consider, unscrupulous advisors that liberally employ certain scare tactics, neither must such Americans be complacent with their tax situation. It is clear that the Internal Revenue Service and Congress have set their sights on United States persons living and working abroad because the potential for tax evasion is greater with offshore assets and accounts. Here’s the scoop about unresolved tax liabilities and what they can mean for the American living abroad.

Federal Tax Lien

Taxpayers living overseas are often misinformed or often conveniently forget about their US Read more

New Jersey Estate Tax: The Uninvited Guest

New Jersey collects both an inheritance tax and its own estate tax, separate from the federal estate tax. Under current law, the estate of every New Jersey resident decedent dying after December 31, 2001 shall be taxed as if the death occurred under the federal laws in effect on December 31, 2001. Because the applicable federal exclusion amount was $675,000 in 2001, a New Jersey estate tax will be due for estates in excess of $675,000 passing to someone other than a surviving spouse — even though the current federal exclusion amount is significantly greater ($5.34 million for deaths in 2014).

While it might seem unfair that the New Jersey estate tax is calculated as if the applicable federal exclusion amount is $675,000 rather than the actual amount in effect at the time of Read more

Minnesota 2013 Nonconformity (Part 2)

Part 1 was all about the debt forgiveness, but there are a number of other items where Minnesota does not conform to the federal rules in 2013. Some items are relatively small dollar amounts like the tuition and fees and educator deductions, and a few others are obscure like the qualified advanced mine safety equipment, the depreciation for motor sports entertainment facilities and interest related dividends from a RIC. There are a few others that have broader applicability.

For older taxpayers that donate directly to a charity from their IRA, the federal return allows them to exclude the IRA distribution from income rather than picking up income and then claiming a charitable deduction. Minnesota won’t allow that so you have to add back the income, but then also add the charitable contribution to the Minnesota return. Read more

Minnesota 2013 Nonconformity (Part 1)

Every year there are tax rules that change for federal purposes and sometimes Minnesota adopts those changes; sometimes they don’t. This year there is a longer than usual list of items that Minnesota does not conform to for individual taxpayers. Often these items are small and obscure and don’t have a huge dollar amount attached to them. This year, one item in particular is going to be a rude realization for some Minnesota taxpayers.

On your federal return you can exclude debt forgiveness income related to your personal residence. In the past you could also exclude that on your Minnesota return, but not this year. Minnesota has not adopted the federal provisions that allow taxpayers to exclude principal residence debt forgiveness. Read more

Amazing Amazon Opens Another California Facility

Amazon has implemented an interesting sales and use tax strategy over the past few years. The battle between the online juggernaut can be best exemplified in California. California attempted to force Amazon to collect California sales and use tax in 2011. Amazon called California’s ultimatum by threatening to pull any ties with California which would cost thousands of jobs. On second thought, California agreed to not force Amazon to collect sales and use tax until September 2012 in exchange for a promise by Amazon to open numerous distribution facilities, which would increase job opportunities in the state.

Putting personal feelings and constitutional implications aside, the move makes sense from both sides. California has the highest statewide sales tax rate of about 7.5%, Read more

Are You Missing the Boat? Do You Find Tax Credits Too Complex? We Don’t!

Today, there currently are nearly 3,000 tax credits and incentives programs in the United States, sponsored by federal, state and local governments to drive job creation, employee training, capital investment and new business development. These statutory and negotiated opportunities – including point-of-hire tax credits, to property & sales tax incentives, to utility & infrastructure abatements, to name a few – are available to companies of all sizes, across a broad range of industries.

But a relatively small number of companies, regardless of their size or financial sophistication, are benefiting fully from the tax credit and incentive-related benefits to which they are entitled. Industry estimates suggest that fewer than 25 percent of eligible US businesses participate in Read more

California’s Governor Brown Signs Bill Increasing Minimum Wage – Increasing Enterprise Zone Credit Value

Governor Brown has signed AB 10 which will increase the minimum wage from $8 an hour to $9 an hour on July 1, 2014 and again to $10 an hour starting January 1, 2016.

An unintended consequence of the legislation will be an increase in the amount of Enterprise Zone tax credits qualified employers will be able to claim. Employers may still claim credits for qualified employees hired through December 31, 2013 for up to five years of employment. The credit is calculated as a function of the hourly wage with a limit of 150% of the minimum wage per hour. Currently, the maximum credit an employer can claim is $12 for an hour of qualified work; starting in July of next year that cap will increase to $13.50. Read more

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