Somewhere within your county, likely at this very moment, a Property Valuation Assessor (PVA) is determining the value of a specific piece of property. Who is your PVA? What is their role? And why does it matter? If you familiarize yourself with your local PVA, you can potentially realize significant property tax savings. Each county has a property valuation department responsible for assessing and collecting property taxes. It is the duty of every PVA to value and assess tax on all real … [Read more...]
Real Property Tax Basics
Property tax is one of our country's oldest taxes; it was even established prior to federal income tax. As far back as the founding of the United States of America, property taxes were assessed on colonists who were settling this country. Property tax is (and has been) one of the primary sources of revenue for local areas and is assessed at a state, county, or city level. These localities are dependent on property tax, as it typically funds community-based resources or services like schools and … [Read more...]
2020 Tax Update for the Tax Planner – Part 2
This is our second posting on the topic, so please check out Thursday’s blog, if you missed it. There have been so many tax changes this year! As you might expect, it is difficult to cover them all. We’ll try to highlight a handful of changes that we think will be most relevant to you as a tax professional. We’ll skip over the changes that are compliance-related, and focus on the provisions from the Secure Act that we feel will be most helpful when it comes to developing tax planning or … [Read more...]
2020 Tax Update for the Tax Planner – Part 1
There have been so many tax changes this year! As you might expect, it is difficult to cover them all. We’ll try to highlight a handful of changes that we think will be most relevant to you as a tax professional. We’ll skip over the changes that are compliance-related, and focus on the provisions from the Secure Act that we feel will be most helpful when it comes to developing tax planning or helping our clients make shifts in order to minimize their tax liability. Auto-Enrollment Tax … [Read more...]
Forgivable Expenses
Good news on forgivable expenses! There is a lot more that is eligible for forgiveness, and not just for new loans. The expanded categories apply retroactively to initial loans, as long as the taxpayer (the borrower) has not already applied for forgiveness. Let’s start with payroll costs. Under the old rule, we had a ratio of payroll to non-payroll costs that was extremely tight. Now, non-payroll costs can go up to 40% of the loan proceeds to be eligible for the total forgiveness … [Read more...]
New Rules on “Covered Period” – Why is timing so important?
This post is focused on timing. Why is timing so important? From a tax-saving standpoint, not every dollar of deduction is worth the same amount every year. The savings depend on the taxpayer’s rate at the time the deduction is taken. For example, let's say that you run a restaurant and your business was really impacted in 2020, to the extent that you have a 15% effective tax rate for 2020. Taking a deduction in 2020 is only worth 15%. If your income rebounds in 2021, it could be worth a lot … [Read more...]
PPP Forgiveness
Although the focus of this post is PPP forgiveness, the loan itself is a great deal. The payment terms are phenomenal, and it can be essential to helping people get back on their feet. So even if you have clients that don't qualify for 100% forgiveness, the interest rate is phenomenal. But loan forgiveness is really where it's at, because that is free money! Let's talk about some exciting developments with two different kinds of loans: the EIDL (Economic Injury Disaster Loan) and the PPP. … [Read more...]
Forget about “Simple”
Here is a common misconception: if a task is simple, it isn’t valuable. Don’t take this misconception lightly, as it can have huge implications regarding how you promote your business and the value you create. Pricing and effort are often (but not always) aligned. A painter, for instance, will charge a lot more to paint your entire house than a single room. That’s reasonable. But experts are compensated for the value they create, not the time they put in. Imagine you walk off the tennis … [Read more...]
Tax Carryovers: Do Statutes of Limitations Force You to Live with Your Mistakes?
We have previously discussed the statute of limitations regarding tax audits when the taxpayer applies a net operating loss (NOL) to a year that is before or after the year that the loss occurred. Although the IRS may not audit a taxpayer three years beyond the return, when a taxpayer applies a net operating loss, the IRS may examine records and other evidence from the year when the loss occurred – even when it is outside the three-year statute of limitations. But what happens when your … [Read more...]
Corporate Refund Claims With Minimum Tax Credit Perplex IRS
Corporations have been receiving refunds from carrying back net operating losses, but those taxpayers with alternative minimum tax implications in that carryback year might need to check those refunds twice. “Clients are receiving refunds particularly on more straightforward filings” of Form 1139, “Corporation Application for Tentative Refund,” Kirsten Wielobob of EY said June 26 during her firm’s webinar. However, there’s been some confusion at the IRS on the more complex submissions, … [Read more...]
