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A Deeper Look

New York State’s Fiscal Year 2019-2020 Budget Bill

May 8, 2019

On April 12, 2019, Governor Cuomo signed the New York State (“NYS”) Fiscal Year 2019-2020 Budget Bill (“Bill”) which extends some previously enacted changes as well as adding new provisions. Discussed below are the major highlights of the Bill. PERSONAL INCOME TAX Extension of the Millionaire’s Tax: The top NYS personal income tax bracket of 8.82% was scheduled to expire after 2019. The Bill extends the “Millionaire’s Tax” for five years, through 2024. Extension of Charitable Contribution Deduction Limitation: Currently, the NYS itemized charitable deduction is limited to 50% of the federal deduction for individuals with adjusted gross income (“AGI”) […]

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Final Regulations Under IRC Sec. 199A

February 12, 2019

Introduction On January 18, 2019, the Treasury Department finalized regulations that were issued in proposed form in August 2018 under Section 199A, which deals with the new 20% deduction for “Qualified Business Income” (QBI). They also issued Notice 2019-7, which contains a proposed revenue procedure providing a safe harbor for treating rental real estate enterprises as qualified businesses and issued new proposed regulations dealing with suspended losses, RICs, and certain trusts. Following is a question-and-answer discussion of the key provisions in the new guidance. 1. Specified Service Trade or Business (SSTB) Unless the taxpayer’s income is under the $157,500/$315,000 threshold, […]

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New York State’s Treatment of Certain Federal Tax Cuts and Jobs Act (TCJA) Provisions

February 4, 2019

The TCJA brought about many federal changes to both personal and business taxes. Many states starting point in determining taxable income is federal income which lead them to decouple from certain changes. New York State (NYS)  is one of them. With respect to personal income tax, the NYS Department of Taxation and Finance has put out guidance highlighting its tax treatment of various federal items of income, deductions and credits. Specifically, it issued TSB-M-18(6). Below are the highlights: Personal Tax Income Alimony or separate maintenance payments NYS opted not to follow changes made by the TCJA to the treatment of […]

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Partnership Audit Rules

November 20, 2018

Overview of the New Audit Rules Under the new streamlined audit approach, the IRS will audit the partnership’s items of income, gain, loss, deduction, credit and partners’ distributive shares for a particular year of the partnership (the “reviewed year”). Any adjustments will be made at the partnership level and taken into account by the partnership in the year that the audit or any judicial review is completed (the “adjustment year”). In a significant departure from previous rules, the general rule is that an “imputed underpayment” will be assessed and collected at the partnership level. An adjustment that does not result […]

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Meal Deductibility Under New IRS Guidance

October 4, 2018

The IRS has just issued long-awaited guidance regarding the deductibility of business meals under the Tax Cuts and Jobs Act of 2017. The Act fully eliminated the deductibility of entertainment expenses, while most business meals continue to be 50% deductible. However, it was not clear how this affected meals related to entertaining clients, referral sources, etc. IRS Notice 2018-76 provides that taxpayers may deduct 50% of an otherwise allowable business meal expense if: The expense is an ordinary and necessary expense under §162(a) paid or incurred during the taxable year in carrying on any trade or business; The expense is not […]

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Not-For-Profits ( NFP ) Accounting Changes – Are You Ready?

August 30, 2018

Since 1993, targeted financial reporting standards for Not-For-Profit (“NFP”) organizations  have been relatively unchanged. However, FASB’s soon to be effective ASU 2016-14, Not-for-Profit Entities (Topic 958): Presentation of Financial statements of Not-for-Profit Entities (“amendments”), contains significant targeted changes and enhancements to the NFP financial reporting model. These amendments change the presentation and disclosure requirements (qualitatively and quantitatively) for several NFP areas such as: (i) reduction in net asset classes (ii) reporting on functional expenses (iii) disclosure of liquidity, flexibility and availability of financial resources, and (iv) several other areas. Transparency, disaggregation, modernization and understanding liquidity were the underlying themes for […]

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Quality of Earnings Reports

August 27, 2018

It is clear that the economy is growing stronger and investment dollars are flowing more freely, particularly in certain industries such as HealthCare. Accordingly, many enterprises are evaluating if they should sell their business or expand through acquisitions. Human nature is to explore the sell side first. However, no matter which side of the fence an enterprise is on (i.e., buyer, seller, or in the process of determining which side their enterprise should be on), relying on an external professional analysis is one of management’s most valuable tools to help arrive at an answer and to provide third party comfort […]

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New Proposed Regulations Under IRC SEC. 199A

August 16, 2018

On August 8, 2018 the Treasury Department issued long-awaited guidance in the form of proposed regulations under Section 199A, which deals with the new 20% deduction for “Qualified Business Income” (QBI). Following is a question-and-answer discussion of the key points in the regulations. 1. SPECIFIED SERVICE TRADE OR BUISNESS Income from a “specified service trade or business” (SSTB) does not qualify for the deduction unless the taxpayer’s taxable income is under $157,500/$315,000 threshold. The law lists various service-type businesses that are treated as SSTB’s, including consulting, financial services, brokerage, and any trade or business where “the principal asset is the […]

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State and Local Tax Update: New Jersey Budget Bill

August 15, 2018

In early July, Governor Murphy signed a compromise 2018/2019 New Jersey Budget Bill. Below is a summary of these changes which affect income, corporate, and sales tax. Personal Income Tax The top tax rate increases from 8.97% to 10.75% for NJ taxpayers with taxable income of $5 million and higher. Increase in the property tax deduction from $10,000 to $15,000. The Homestead Rebate Program has been reinstated. Effective for tax years beginning after 2017, a taxpayer who is allowed a Federal Child and Dependent Care Credit may also be permitted to claim a state tax credit. Corporation Business Tax A […]

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2017 Tax Cuts and Jobs Act: Major Provisions Affecting Real Estate

July 25, 2018
With its implementation, the 2017 Tax Cuts and Jobs Act provided for the most significant changes to the Internal Revenue Code in decades and will affect almost every taxpayer. Gettry Marcus has created an overview of the most significant topics affecting the Real Estate Industry. DOWNLOAD PDF More [+]
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