Tax Planning & Preparation

New Tax Credit

Are you ready to take advantage of the new InvestOhio tax credit?  The registration period is now open and registration must be completed before you can apply for the credit. The application date is expected to be the first full week in December and now is the time to ensure that you are ready to apply.
 
What is InvestOhio?

InvestOhio is a tool for helping Ohio small businesses gain the capital they need to succeed and create jobs.  Through the program, individuals who invest up to...

This month's Special Delivery e-newsletter includes the following articles:

• Year-End Tax Planning
• InvestOhio Tax Credit REgistration Now Open: Quick Action Required
• Make 2012 a "Record Year" for Taxes
• Happy Trails: Getting Ready for Retirement
• How to Put Time on Your Side
• Group Workers' Compensation Programs
• Skoda Minotti Professional Receives Certified Exit Planning Advisor Credential

Year-End Tax Planning

Once again we find ourselves with the Holidays upon us and we wish you and your family all the...

Tax planning for the year ending 2011 and beyond will again prove challenging due to uncertainties over whether Congress will enact sweeping tax reform.  And even if there’s no major tax legislation, Congress will have to deal with the “patch” to the alternative minimum tax, and decide what to do about the expiring of the Bush-era income tax cuts.

Regardless of what Congress does late this year or early the next, there are solid tax savings to be realized by taking advantage of tax breaks that...

Year-end tax planning is especially challenging this year because of uncertainty over whether Congress will enact sweeping tax reform that could have a major impact in 2012 and beyond.  Regardless of what Congress does late this year or early the next, there are solid tax savings to be realized by taking advantage of four tax breaks that are on the books for 2011 but may be gone next year unless they are extended by Congress: 

• Option to deduct state and local sales and use taxes instead of state...

There’s one word that can be used to describe the stock market as well as estate and gift tax laws over the past few years and that is “volatile”  Unfortunately, volatility often scares clients into taking the “wait and see” approach but in reality, there’s no time like the present to do some estate planning and make lifetime gifts.

What are the current laws:

• Beginning January 1, 2011, the federal estate, gift, and generation-skipping transfer tax exemptions were all set at $5 million with a top...

Several tax breaks are on the books for 2011 but may be gone next year unless they are extended by Congress. One of them is the small energy credit.

• What it is:  Credit of up to $500 total and $200 for windows for the installation of energy efficient doors, windows, furnaces and air conditioning units, to your main home (includes boats, motorhomes, condominiums) if the items are installed before 2012.  This credit is reduced by the amount of energy tax credits taken from 2006-2010.
• Who it applies...

What a year it has been. In 2011 we have witnessed devastation caused by a wide variety of natural disasters, ranging from tornadoes to floods to wildfires. Although it is a small consolation if your home or other property is damaged as a result, at least you may be able to deduct a casualty loss on your tax return.

Basic rules: You may qualify for a casualty loss deduction if damage is caused by an event that is “sudden, unexpected or unusual.” This not only includes natural disasters already...

Several tax breaks are on the books for 2011 but may be gone next year unless they are extended by Congress. One of them is tax free distributions by those age 70 ½ or older for charitable purposes.

• What it is: Taxpayers who have reached age 70 ½ can make a distribution of up to $100,000 directly (by the trustee of the IRA) from the IRA to a charitable organization.  The distribution is not taxable and the charitable deduction is not allowed, but the distribution counts towards a taxpayer’s...

Several tax breaks are on the books for 2011 but may be gone next year unless they are extended by Congress. One of them is the above the line deduction for qualified higher education expenses.

• What it is: 
  - American Opportunity Credit - taxpayers have the option of either deducting higher education expenses or taking a credit for them of up to $2,500 per student.  This credit is partially refundable (40%). 
  - Lifetime Learning Credit - taxpayers have the option of either deducting higher...

Several tax breaks are on the books for 2011 but may be gone next year unless they are extended by Congress. One of those is the option to deduct state and local sales and use taxes instead of state and local income taxes.

• What it is:  Currently, taxpayers have the ability to deduct, as an itemized deduction, either State and Local sales tax or State and Local income tax.
• Who it applies to: Although this deduction usually applies to our snow birds that have moved their residency to Florida,...

As you may remember from our July e-newsletter, Ohio recently created a new small business investment tax credit. New details of the program have now emerged and quick action may be required to take advantage of this tax credit which begins Monday, November 14^th.

What is InvestOhio?

Through the program, individuals who invest up to $10 million in eligible small businesses

may receive a 10 percent income tax credit if the investment is held for two years.

The credit is a non-refundable personal...

If you own real estate, a cost segregation study is one of the best tools to help you reduce taxes and improve cash flow. Although a cost segregation study will not provide additional tax deductions, it will enable the taxpayer to accelerate a portion of the depreciation on the building. Cost segregation is the process of breaking out a portion of a building’s cost that can be depreciated quicker than the standard life of 39 years.

Where should a property owner start when considering a...

A new small business investment tax credit is available as a part of the recently passed Ohio Budget Bill. The nonrefundable credit of 10% of a qualifying investment is available for investments in certain small business enterprises operating in Ohio. The credit is up to $1,000,000 per taxpayer or $2,000,000 for married couples filing jointly.

What businesses qualify for investment?

• At the time of the investment, either total assets do not exceed $50,000,000, or annual sales do not exceed...

According to the IRS, if you plan to travel, or have traveled, on or after July 23, 2011, and you purchased your ticket on or before July 22, 2011, you are entitled to a refund for the federal air transportation excise taxes that was paid when you purchased your ticket.

Airlines are now permitted to refund the tax to the passenger, just as they do in the ordinary course of business when issuing refunds for unused refundable tickets (including the associated taxes). Because the airlines and travel...

Ohio recently enacted legislation creating two tax amnesty programs that may affect you or your business. 

Use Tax Amnesty Program

The first program is a change to the Ohio Use Tax Education Program. In case you are unaware, here is a quick refresher on Ohio use tax.

Use tax is a tax on the storage, use or other consumption of tangible personal property and certain taxable services in Ohio. The use tax is a complement to the sales tax.   In general, if you have paid Ohio sales tax on an item,...

Reduced Taxes for Exporters Extended: Are You Taking Advantage of the IC-DISC?

Does your Company export goods to Canada, Mexico, or other countries?  Do you provide engineering, architecture, or design for property constructed outside the United States?  If so, you may be eligible for a Federal income tax incentive known as an Interest Charge Domestic International Sales Corporation (the "IC-DISC").  The IC-DISC could potentially save you a significant amount of US income taxes.

Click here to...

Does your Company export goods to Canada, Mexico, or other countries?  Do you provide engineering, architecture, or design for property constructed outside the United States?  If so, you may be eligible for a Federal income tax incentive known as an Interest Charge Domestic International Sales Corporation (the “IC-DISC”).  The IC-DISC could potentially save you a significant amount of US income taxes.

What is the IC-DISC?

Many closely held businesses are enjoying the benefits of the IC-DISC....

The treatment of success-based fees has been the subject of controversy between the Internal Revenue Service (“IRS”) and taxpayers.  On April 8, 2011, the IRS issued Revenue Procedure (“Rev. Proc.”) 2011-29 that provides guidance on the deductibility of success-based fees.  These fees, generally paid to investment bankers or private equity firms, are contingent on the successful closing of certain transactions.  Often, these fees are the largest single expense of an acquisition.

Under IRS...

This month's Special Delivery e-newsletter includes the following articles:

• New Law Extends Favorable Capital Gain Rules
• How to Help Pay for College Education
• The Wrap-up for Wrap Fees
• Aurum Capital Markets Summary
• Repeal of Expanded 1099 Requirements
• Audio Book Club
• College Planning
• Advisor Insights Video Archive
• Delivering on the Promise

New Law Extends Favorable Capital Gain RulesThe tax rules for offsetting capital gains and losses can be confusing, even for experienced investors. Saving grace: The...

This month's Special Delivery E-Newsletter includes the following articles:

• Fourth Annual Survey of Northeast Ohio Real Estate and Construction Industries
• Significantly Reduce Your Not-for-profit Audit and Tax Expenses
• Stay Within Charitable Deduction Boundries
• Roth IRA Conversions: Time to Decide
• New Estate-tax Relief: It's Complicated
• Aurum Capital Markets Summary and New Web Site
• Does Your Business Have an Ohio Use Tax Account
• April Audio Group - Audio Book Club Meeting
• College Planning One-on-One...