State & Local Tax Planning
US Tax Court Rules on Sale of Conservation Easement State Tax Credits
In 136 T.C. No. 15, the United States Tax Court (the Court) ruled that individuals that sold conservation easement state tax credits were required to treat that income as short-term capital gain. Specifically, the Court ruled: 1) The taxpayer had no basis to offset the sale of the credits – the basis in the taxpayer’s land was allocable to the state credits. 2) The credits were a capital asset under Sec. 1221 3) The holding period of the credits began at the time the credits were granted and ended when the taxpayer sold the credits. The taxpayer’s holding period in the land did not. Read More.
Sales and Use Tax — Don’t Get Caught in a Game of ‘Gotcha’
Attention to detail is critical when dealing with sales and use taxes , as personal liability can result even when conducting business as a corporation or limited liability company. The sales tax is an additional cost tacked on to purchases of tangible personal property and certain services. The use tax, however, is a compensatory tax paid directly by the purchaser when the seller doesn’t collect the sales tax. Unfortunately, sales and use tax complexities are compounded in the construction industry. Sales of real estate typically are not subject to tax, but contractors are subject to tax on their purchases of tangible personal property that. Read More.
Florida Sales & Use Tax Guidance Supports Taxing Rent Paid Between Related Entities
The Florida Department of Revenue (the Department) recently issued guidance on sales and use tax as it relates to specific rental arrangements. Issuing Technical Assistance Advisement 10A-026 on 06/07/2010, the Department addressed questions from related entities involved in a rental arrangement. In the scenario, a group of owners owns both an LLC, which holds the real property, and a Subchapter S corporation (the Taxpayer) which occupies the same property. The owners claimed that, since both entities are owned by the same persons, and no formal lease exists, the LLC is not engaged in commercial rental activities. Further, since the structure only exists to secure financing, this relationship is. Read More.
Guidance for New Withholding in North Carolina
According to the North Carolina (NC) Department of Revenue Directive PD-10-1, effective January 1, 2010 , a payer is required to withhold North Carolina income tax of four percent from non-wage compensation paid to either of the following: A nonresident individual or nonresident entity for personal services performed in North Carolina. An Individual Taxpayer Identification Number (ITIN) holder who is a contractor and not an employee for services performed in North Carolina. The requirement to withhold applies to payers who, in the course of a trade or business, expect to pay more than $1,500 within a calendar year of non-wage compensation. That compensation must be paid to nonresident or ITIN contractors, with. Read More.
Have You Developed a Year-End Tax Strategy? Time Is Running Out
As 2009 closes in just a few days, there are some important tax changes that will help you save money and prepare to file your 2009 tax return in the spring. We have summarized many of the major changes in our blog post, “Tax Planning Strategies & Year-End Considerations” in November, and since it has been one of our most popular posts, we’ve reposted it here and encourage you to review this information again before starting the process for your 2009 tax return.
Cherry, Bekaert & Holland Expands Unclaimed Property Services Through Alliance with The Keane Organization
Strategic alliance offers streamlined suite of escheatment solutions to businesses of all sizes State governments nationwide are facing budgetary shortfalls led by significant declines in tax revenues . As a result, many are ramping up efforts to enforce unclaimed property/escheatment laws. Such laws have existed for years, and are enhancing state revenues at an estimated $2.5 billion each year. From uncashed checks and accounts receivable credit balances to unredeemed gift card or stored value card balances, businesses across the country are assessing their unclaimed property liability. Yet despite the surge in unclaimed property audits, many of the nation’s largest accounting firms no longer offer services or have. Read More.