stateandlocaltax Archives - Wiss & Company, LLP

Biden Administration Releases 2024 Budget, Green Book

Written on March 27, 2023. Posted in Tax.

The Biden administration on March 9 unveiled a budget proposal for fiscal 2024 that would reduce the federal deficit by nearly $3 trillion over 10 years, primarily by raising taxes on high-net-worth individuals and large corporations. The proposed budget would increase the U.S. corporate income tax rate from 21% to 28%, and the top individual ordinary income tax rate from 37% to 39.6%. The international tax rules would be amended to raise the tax rate on the foreign earnings of U.S....

Tax-Free Qualified Disaster Relief Payments to Employees in Connection With COVID-19 Will End May 11, 2023

Written on February 23, 2023. Posted in General Business, Small Business, Tax.

The Executive Office of the President, Office of Management and Budget, announced on January 30, 2023, that the COVID-19 national and public health emergencies declared in 2020 would end on May 11, 2023. As a result, COVID-19 cannot be the reason used to make tax-free “qualified disaster relief payments” to employees (or others) under Internal Revenue Code Sec. 139 for expenses incurred on and after that date. This wind-down aligns with the administration’s previous...

2022 Year-End Tax Planning for Individuals

Written on December 22, 2022. Posted in State & Local Tax Services, Tax, Tax Alerts.

By Nicole DeRosa With rising interest rates, inflation and continuing market volatility, tax planning is as essential as ever for taxpayers looking to manage cash flow while paying the least amount of taxes. As we approach year-end, now is the time for individuals, business owners and family offices to review their 2022 and 2023 tax situations and identify opportunities for reducing, deferring or accelerating their tax obligations. The information contained within this article is...

ASC Topic 842 & Government Contracting

Written on May 17, 2022. Posted in General Business, State & Local Tax Services, Tax.

By Jeremy Higginson, CPA Government contractors breathed a collective sigh of relief when the Financial Accounting Standards Board (FASB) pushed back the deadline for private companies and nonprofits to comply with new lease accounting rules in April 2020. Accounting Standards Codification (ASC) Topic 842, also known as Accounting Standards Update (ASU) 2016-02, Leases is now applicable for the fiscal year and interim periods beginning after Dec. 15, 2021. Topic 842 applies to both...

Wiss and NetLease by Netgain partner to increase efficiency for ASC 842 lease accounting audits

Written on May 4, 2022. Posted in Assurance, State & Local Tax Services, Tax.

Netgain offers easy audit solution Denver, CO, May 4, 2022 – The new lease accounting standard went into effect on Jan. 1, 2019 for public companies and on Jan. 1, 2022 for private and not-for-profit companies. Wiss spent two years evaluating different solutions and needed a lease accounting software solution in anticipation of the 2022 audit season. Paul Peterson, Managing Partner, Wiss, reached out to Netgain, to evaluate NetLease for Auditors, their lease accounting product...

Remote Employment 101: Hiring For Success

Written on March 29, 2022. Posted in Human Resources, State & Local Tax Services, Tax.

If there is one thing that has changed in the past two years, it is that employers realize they can easily find talent anywhere, and they might now be willing to hire talent to work remotely. Hiring remote workers across the country, however, brings different challenges that employers may not even think about. Employers are typically subject to the employment laws of the state where the employee is working, so it is important that attention is paid to what each state and locality...

What Does Biden’s Executive Order Mean for Crypto Reporting?

Written on March 10, 2022. Posted in State & Local Tax Services, Tax, Tax Alerts.

By Nicole DeRosa, CPA, MAcc, Senior Tax Manager To further add to the “Crypto Crackdown,” yesterday, President Joe Biden signed the “Executive Order on Ensuring Responsible Development of Digital Assets” which set out his administration’s strategy to explore greater regulatory oversight of the digital asset market and prioritize the assessment of a Central Bank Digital Currency. The devil is most certainly in the details; however, this is the most wide-reaching effort...

Can I Raise Cash Flow for My Small Business With Government Money?

Written on February 23, 2022. Posted in Early Stage, Small Business, State & Local Tax Services, Tax.

There’s nothing worse than finding out you could’ve qualified for government funding after it’s too late, especially when your business is in its infancy and you could use all the cash you can get your hands on. Most of the founders we advise aren’t aware of the financial help that’s out there, or which programs are available for their business. We introduce two specific opportunities for government funding that are important for startups to know about: national tax credits and...

Build Back Better Act: the Legislative Lull That Won’t Budge

Written on February 17, 2022. Posted in State & Local Tax Services, Tax, Tax Alerts.

Last year was another busy legislative year with new administration taking office and tax laws being passed left and right. The American Rescue Plan was enacted back in March; the Infrastructure Investment and Jobs Act (IIJA) was signed into law in November and last, but certainly not least we come to the Build Back Better Act (BBBA) which was the last piece of major legislation the Biden administration sought to enact in 2021. In the face of opposition by some moderate Democratic...

Significant Change to the Treatment of R&E Expenditures Now In Effect

Written on January 27, 2022. Posted in State & Local Tax Services, Tax, Tax Alerts.

As 2022 kicks off and tax legislation continues to be stalled in Congress, the amendment to Internal Revenue Code (IRC) Section 174 originally introduced by the 2017 tax reform legislation, the Tax Cuts and Jobs Act (TCJA), is now in effect. TCJA’s amendment to Section 174 requires U.S.-based and non-U.S-based research and experimental (R&E) expenditures to be capitalized and amortized over a period of five or 15 years, respectively, for amounts paid in tax years starting after...

Updated Reporting Requirements for NY Tax-Exempt Organizations

Written on January 13, 2022. Posted in Not For Profit, State & Local Tax Services, Tax, Tax Alerts.

By Eitan Balloul, Tax Manager, Not-for-Profit In November of 2021, Governor Kathy Hochul of New York signed bill A1141A/S4817A to repeal NY Executive § Law 172-b. This law required certain exempt organizations who were registered with the New York State Attorney General (Department of Law) to submit an additional filing with the New York Department of State. Executive § Law 172-b became effective on January 1, 2021, and to many Exempt Organizations, it meant the burden...

Incorporation 101: C-Corp vs. LLC

Written on January 5, 2022. Posted in Early Stage, General Business, State & Local Tax Services, Tax.

So you’ve decided to start a business. Once you get past the initial excitement of throwing ideas around with your co-founders, it’s time to make your first big decision: how you’ll structure your organization. Choosing a corporate entity type can feel overwhelming if you’ve never done it before. And even if you have, each industry and business has unique needs. In this article, we’ll break down some important details you need to know about the two most common types of entities:...

2021 Year-End Tax Planning for Individuals

Written on December 14, 2021. Posted in State & Local Tax Services, Tax, Tax Alerts.

By Nicole DeRosa, CPA, MAcc, Senior Tax Manager As we approach year-end, now is the time for individuals, business owners, and family offices to review their 2021 and 2022 tax situations and identify opportunities for reducing, deferring, or accelerating tax obligations. Areas potentially impacted by proposed tax legislation still in play should be reviewed, as well as applicable opportunities and relief granted under legislation enacted during the past year. The information...

Wiss Helps You Run Your Business With an Eye on the Future

Written on November 30, 2021. Posted in Real Estate, State & Local Tax Services, Tax.

By Eliezer Gross, CPA Wiss is a full‐service accounting firm that provides more than annual tax compliance or updates on the latest tax law changes. Our clients frequently seek guidance during every stage of their business: startup, growth phase, succession planning, and exit. Here’s how Wiss has solved some of the challenges our clients face in the real estate industry. The Challenge: Real Estate Acquisition Clients in the growth stage of their business who make real estate acquisitions...

Preparing for Tax Season

Written on November 16, 2021. Posted in State & Local Tax Services, Tax, Tax Alerts.

New for tax year 2021/tax season 2022: The IRS just released on November 8th their tips for getting ready for the upcoming filing season. Now is the time to start and make a list of the tax documents you are expecting and use that list to cross off the items as you receive them. Also keep in mind if you receive certain documents electronically or by mail so you can be on the lookout for these items. You can use your prior year tax returns and records as a guide for what to expect....

Third Time’s the Charm?

Written on November 16, 2021. Posted in State & Local Tax Services, Tax, Tax Alerts.

A third version of H.R. 5376 (the Build Back Better Act) was released on November 3, 2021 by the House Budget Committee. This draft increases the state and local tax deduction, brings back many of the retirement proposals from the original September 13 draft of the Build Back Better Act, and retains the surcharge on high-income individuals, estates and trusts from the October 28 version. Below is a summary of where things stand today. Income Tax State and Local Tax Deduction Individual...

R&D Tax Credits for the Technology & Software Industry

Written on November 9, 2021. Posted in State & Local Tax Services, Tax, Tax Alerts, Technology.

Generate cash from your past and future investments to develop or improve software. If your company has paid for software to be developed or improved in the U.S., you may be eligible for federal and state R&D tax credits equaling up to 25% of qualified spending. If your company is financing such activities outside of the U.S., the incentives may be even greater. These dollar–for–dollar offsets against regular income tax liability have enabled many startup and mature businesses...

R&D Tax Credits for the Manufacturing Industry

Written on November 2, 2021. Posted in Engineering, State & Local Tax Services, Tax, Tax Alerts.

The manufacturing industry alone claims annual R&D tax credits in excess of $7.4 billion. Innovation is driving the manufacturing industry, and the objective of R&D tax credits is to encourage exactly the type of efforts that are at the core of Industry 4.0. You don’t have to be developing new products or engineering brand new manufacturing processes to qualify for the R&D tax credit. If your company is attempting to develop or improve manufacturing processes or products,...

R&D Tax Credits for the Life Sciences Industry

Written on October 26, 2021. Posted in Healthcare, State & Local Tax Services, Tax Alerts.

Generate cash from your past and future investments in developing or improving products, formulas or devices, or advancing medical and pharmaceutical technology. In recent years, the Life Sciences industry has been under heavy pressure to drive innovation in an environment of escalating R&D costs, increasing scientific complexity and enhanced regulatory scrutiny. If your company has worked to develop new or improved pharmaceuticals or medical devices, formulas or technology,...

R&D Tax Credits for the Healthcare Industry

Written on October 19, 2021. Posted in Healthcare, State & Local Tax Services, Tax, Tax Alerts.

Capitalizing on evolving patient care through past, present, and future innovation. R&D is likely to be a continued priority for the healthcare industry, as organizations in the space work to address the emerging needs of the aging population, respond to trends in telehealth and value-based care and fend off competition from new entrants, like Amazon, which has signaled that healthcare is a key priority for growth. If your organization has worked to develop a new or improved...

Heads Up, Restaurants: Federal Relief Could Trigger a Single Audit

Written on September 15, 2021. Posted in Assurance, Food & Beverage, General Business, State & Local Tax Services, Tax, Tax Alerts.

By Arnold Macalintal, Partner Since the outbreak of COVID-19, the restaurant industry has been one of the hardest hit by the pandemic’s impacts, leading to spikes in business closures, continued capacity limitations, and unprecedented loss in both jobs and sales. However, many establishments were able to keep their doors open and continue to serve customers throughout the course of the pandemic with the help of federal aid issued through the CARES Act programs, Restaurant...

The Pass through Entity Tax (PTET) Now Applies to New York State – Here’s What You Need to Know.

Written on April 15, 2021. Posted in State & Local Tax Services, Tax, Tax Alerts.

Featuring Phil London, Partner Emeritus Legislative changes in the New York State budget have created the highest combined local tax rate in the country for some New York City residents. At the same time, a Pass Through Entity Tax (PTET) was enacted in New York State. Below, Philip London, member of the New York State Society of CPAs, and the New York, Multistate and Local Taxation committee, provides insight on the new law. Tell us about your involvement in the passing...

Got Unemployment Compensation? Don’t Rush to File or Amend Just Yet!

Written on March 15, 2021. Posted in American Rescue Plan, Financial Planning, State & Local Tax Services, Tax, Unemployment.

By Nicole DeRosa, CPA, MAcc, Senior Tax Manager Last week, the $1.9 trillion American Rescue Plan Act of 2021 signed into law by President Biden included a very welcome retroactive tax provision for unemployed workers. The bill provides that up to the first $10,200 of unemployment compensation benefits, paid to you in 2020, can now be excluded from taxable income, provided household income is under $150,000. Although a very welcomed provision for the unemployed, there...

PPP Loans Become More Favorable for Small Business, Other Important Updates

Written on March 4, 2021. Posted in PPP, Small Business, State & Local Tax Services, Stimulus Package, Uncategorized.

By Travis Miskowitz, Director, CFO Advisory The Paycheck Protection Program (PPP) became more favorable to small business as the Small Business Administration (SBA) in cooperation with the Department of Treasury, revised the loan calculation for sole proprietors, independent contractors, and those that are self-employed increasing their chances of obtaining a higher loan amount in contrast to existing guidance. Other important updates were included in two new pieces of...

PPP Processing Delays – More Communication Required from SBA

Written on February 5, 2021. Posted in Financial Planning, General Business, PPP, State & Local Tax Services, Tax, Tax Alerts.

By Travis Miskowitz, Manager CFO Advisory When the Small Business Administration rolled out the Paycheck Protection Program in 2020, there was an immediate need to stem the losses and financial difficulties that small business owners were facing due to the pandemic and government-mandated shutdown orders. The early days of PPP were fraught with processing issues, incomplete or inconsistent guidance, and a lack of reliable resources for small business owners to reference when applying...

The Business Interest Expense Limitation under IRC Section 163(j): What You Need to Know for the 2020 Tax Year

Written on January 28, 2021. Posted in Financial Planning, General Business, State & Local Tax Services, Tax, Tax Alerts.

By Jennifer Beceiro, Tax Manager & Eliezer Gross, Real Estate Tax Director The Tax Cuts and Jobs Act (TCJA) amended IRC Section 163(j) that limited the deductibility of business interest expense for taxable years beginning after December 31, 2017. Business interest expense is limited to the sum of the Taxpayer’s business interest income, floor plan financing interest, and 30% of Adjusted Taxable Income (ATI). There are two situations that Taxpayers may not be subject to the 163(j)...

Straight Outta Congress: How to Maximize the Employee Retention Credit (ERC) & Paycheck Protection Program (PPP)

Written on January 19, 2021. Posted in General Business, PPP, State & Local Tax Services, Tax, Tax Alerts.

By Travis Miskowitz, Manager, CFO Advisory This is a developing story; updates will be published as additional information becomes available. Update: March 3, 2021 As we enter March, we would like to remind our clients and friends that they may be eligible for 2 very beneficial programs: Employee Retention Credit (ERC) and a 1st Draw or 2nd Draw PPP loan. The ERC is a refundable credit which can now be claimed retroactively by PPP borrowers to 2020 if the company meets 2 main eligibility...

PPP “Yeah, You Know Me” – 3rd PPP Application Window Opening Soon

Written on January 8, 2021. Posted in PPP, State & Local Tax Services, Tax.

By Travis Miskowitz, Manager, CFO Advisory Late Wednesday evening, the U.S Small Business Administration (SBA) in coordination with the Department of Treasury, issued guidance for the revamped Paycheck Protection Program (PPP) authorized by the Economic Aid Act of 2020. The newly released guidance includes: Interim Final Rule (IFR) “Business Loan Program Temporary Changes; Paycheck Protection Program as Amended” an 82-page consolidation of existing PPP guidance in the form of 24...

Breaking Down the Employee Retention Credit in the New COVID Relief Bill

Written on January 6, 2021. Posted in State & Local Tax Services, Tax, Tax Alerts.

By Ilya Brodetskiy, Tax Manager Some significant updates are affecting the Employee Retention Credit, but there are still some important unknowns. Businesses that were ineligible for the ERC because they applied for PPP funding or who had over 100 full-time employees should reevaluate their eligibility based on the expanded program. The Consolidated Appropriations Act of 2021 introduced major changes to the Employee Retention Credit (ERC). The first change allows businesses that...

Show me the money…again! Congress agrees to $900B Emergency Coronavirus Relief Act of 2020

Written on December 21, 2020. Posted in General Business, State & Local Tax Services, Tax Alerts.

By Nicole DeRosa, CPA, MAcc, Senior Tax Manager, and Travis Miskowitz, Manager, CFO Advisory Congressional leaders are close to finalizing the next round of stimulus, referred to as the Emergency Coronavirus Relief Act of 2020 providing for $900 billion in government funds aimed at supporting small businesses and the ailing economy. The coronavirus relief bill is expected to pass with bi-partisan support, and the President is expected to sign the bill into law quickly. The relief...

Treasury and IRS Issue Guidance on Deductibility of Expenses Related to a PPP Loan

Written on November 19, 2020. Posted in State & Local Tax Services, Tax, Tax Alerts.

By Michael Bodrato, Director of Taxes The US Treasury and the Internal Revenue Service (“IRS”) released guidance on November 18, 2020, in Rev. Rul. 2020-27 and Rev. Proc. 2020-51, clarifying the tax treatment of expenses where a loan received under the Paycheck Protection Program (“PPP”) has not been forgiven by the end of the year in which the loan was received. The IRS clarified in a notice issued on May 18, 2020, that since under the CARES Act businesses are not taxed on the proceeds...

How a Biden Administration May Change the Tax Landscape

Written on November 11, 2020. Posted in State & Local Tax Services, Tax, Tax Alerts.

By Laurie Smith With the presidential election in our rearview window (barely), next up on everyone’s mind is how president-elect Joe Biden’s tax proposals may impact you. Before we get into the details of some key proposals and planning opportunities, it is important to note there are still many unknowns. Crucially, it will not be clear until early-to-mid-January 2021 which party will control the Senate, the result of two run-off races in Georgia taking place on January 5. The outcome...

Get To Know Federal Tax Form 5471, and The Post-2017 Revisions

Written on August 7, 2020. Posted in State & Local Tax Services, Tax, Tax Alerts.

By Mary Vasilescu The IRS collects information about foreign corporations with substantial United States (U.S.) ownership interests using Federal Tax Form 5471, Information Return for U.S. Persons With Respect to Certain Foreign Corporations. Form 5471 is used by certain U.S. persons who are officers, directors, or shareholders of certain foreign corporations to satisfy the reporting required under the Internal Revenue Code (IRC) and the related Treasury Regulations. Beware Hefty...

Elective Business Alternative Income Tax for Pass-Through Entities to Address Federal Limitation on State and Local Deduction

Written on January 21, 2020. Posted in State & Local Tax Services, Tax, Tax Alerts.

On January 13, 2020, Governor Phil Murphy signed into law Senate Bill 3246 establishing the business alternative income tax, an elective New Jersey business tax for pass-through entities. A corresponding refundable state gross income tax credit is allowed for the owners of the pass-through entities to offset personal or corporate income tax liability. The pass-through entity tax applies to tax years beginning on or after January 1, 2020. The intent of the new legislation is to...

New Jersey & New York Attempt Work-around on the SALT Deduction Limitation

Written on May 7, 2018. Posted in State & Local Tax Services.

New Jersey Governor Phil Murphy signed legislation this past Friday (May 4, 2018) which attempts to work-around the state and local tax deduction limitation imposed by the Tax Cuts and Jobs Act, which was enacted in December of 2017. Under that federal legislation, the aggregate state and local tax deduction (which includes state income, property and sales tax) an individual taxpayer may claim is limited to $10,000 per year. New York already has their version of a work-around...

Upcoming Changes to New Jersey and New York Taxes

Written on December 19, 2017. Posted in State & Local Tax Services.

By Evan Gernant With tax reform legislation nearing enactment in Washington it’s easy to keep one’s focus on those headlines. There are, however, important changes in New Jersey and New York tax that have already been signed into law and will impact local taxpayers. Below is a summary of the more significant changes you will see affecting New Jersey and New York State taxpayers in 2018 and beyond. New Jersey The sales & use tax rate will continue decrease slightly. A two-phase...

Holy Matrimony: Contractors and New Jersey Sales Tax

Written on November 27, 2017. Posted in State & Local Tax Services.

By Tim Kennedy Not all work performed on a property is created equal in the eyes of the tax collector. Some improvements fall into the realm of capital improvement, while others are considered repairs, and still others are maintenance services. Because New Jersey sales tax rules differ based on the type of work performed, it is important to understand the classifications to avoid paying too much or too little in taxes. Here’s what you need to know. What work is exempt from sales...

Does Your Business Qualify for Lucrative R&D Tax Credits?

Written on March 23, 2017. Posted in State & Local Tax Services.

By Wiss Associate “My company’s not in the business of research and development, so how could we qualify for R&D tax credits?” If that’s what runs through your head when you think of this particular credit, it’s understandable – especially if you don’t have any scientists or many engineers on staff. Or a dedicated research and development department. The truth is, you could earn lucrative federal, state and local tax credits with work that you don’t even think of in conventional...

Governor Christie Keeps Reciprocal Agreement

Written on November 23, 2016. Posted in State & Local Tax Services.

By Wiss Employee In order to boost the state’s revenues, Governor Christie withdrew from a decades old tax agreement with Pennsylvania back in September. It left many business owners and employees anxious about 2017 income taxes and filings. Read in our past blog post about the repercussions of withdrawing from the agreement. On November 22, Gov. Christie announced that the reciprocal agreement with Pennsylvania will remain in place. New Jersey and Pennsylvania residents that...

Christie Launches NJ Gas Spike to End Road Funding Crisis

Written on October 7, 2016. Posted in State & Local Tax Services.

By Christopher Colyer After an extensive three-month long political and financial stalemate, New Jersey Governor, Chris Christie and Democratic leaders reached a deal to renew the Transportation Trust Fund, reviving dozens of construction plans that remained lifeless for months on end. By proposing to raise the gas tax by 23 cents a gallon to replenish the fund, which is recycled and applied to road, rail, and bridge improvements for the state, New Jersey’s transportation projects...

Income Tax Pact Dismantled: Gov. Christie Terminates Tax Covenant with PA

Written on September 15, 2016. Posted in State & Local Tax Services.

By Philip London Do you cross the Delaware River on the way to work? By next year, your commute will be even more expensive. For the past 38 years, neighbor states Pennsylvania and New Jersey have preserved a reciprocity pact that allows taxing solely where workers reside, not where they work. Thus, NJ does not collect tax on PA residents working in New Jersey, and vice versa. However, last week, Governor Christie withdrew from the tax agreement. Consequently, roughly a quarter-million...

Sales Tax Nexus – Comprehending your Business’ Sales Tax Obligations

Written on August 9, 2016. Posted in State & Local Tax Services.

By Wiss Employee In simpler times, a New York-based industry sold its products or services within its state boundaries. As such, it was their responsibility to gather and remit sales tax to the taxing authority of The Big Apple. However, thanks to the rapid advancements in technology, today’s corporate atmosphere has become much more multifaceted. As inter-state sales are becoming routine, the same New York-based company has many more consumers to choose from, amplifying their client...

How to Avoid Tax Penalties on Complimentary Hotel Breakfasts

Written on June 28, 2016. Posted in State & Local Tax Services.

By Mark Feldstein When is a free meal not really free? When a New York State hotel is offering a complimentary breakfast to its guests. While complimentary breakfasts are free – in a sense – to your guests, if your hotel is audited, you could get a tax bill. And the tax penalties for months – or years – of presumed “tax-free” food can add up. New York sales tax and occupancy tax returns are, in most circumstances, subject to audit for up to three years, longer if fraud is suspected....

How to Take Advantage of the Grow NJ Tax Credit

Written on June 26, 2016. Posted in State & Local Tax Services.

By Bill Beiermeister The only bad thing about tax credits is the possibility of missing out on one. To make sure that doesn’t happen to your business, here is some background on the Grow New Jersey tax incentive and how it could affect your company. Per-employee credits add up The Grow New Jersey Assistance Program is offered through the state’s Economic Development Authority (EDA) to encourage businesses in technology, manufacturing, warehousing, research and development and other...

Manhattan taxpayers, be aware of the Commercial Rent Tax

Written on June 14, 2016. Posted in State & Local Tax Services.

By Kyle Pennacchia and Paul Ursich In New York City, the Commercial Rent Tax (CRT) is often overlooked, and many of those who miss it face penalites and interest for late or missed filings. Here’s a brief introduction to the tax, basic qualifications and links to more detailed information. Are you subject to the CRT? The CRT applies to Manhattan tenants who occupy or use property south of 96th Street for most trade, business, professional and commercial transactions. As with most...

Ecommerce Sales Tax Terms you Need to Know

Written on September 8, 2015. Posted in State & Local Tax Services.

By Kyle Pennacchia If your company conducts business in a number of states, you understand how convoluted the sales tax process can be. Traditionally, you started with figuring out how to adhere to the tax collection standards of your own state, then you determined in which other states you were deemed to have a legal presence and, therefore, a tax obligation. Then came the Internet. Ecommerce is a great way to find customers globally that you couldn’t have in the bricks-and-mortar-only...

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