As the tight labor market continues to put upward pressure on wages, many businesses are struggling to attract and retain qualified workers at salaries the company can afford to pay. One often-overlooked tax credit could provide some relief for companies in this situation while also pointing them to a potential source of new employees they might not have considered otherwise. (more…)
Happy Thanksgiving From All of Us at ASL
Think Twice Before Joining the Short-Term Rental Trend
By Carmen Barrett, CPA, MST, Senior Manager, Tax & Advisory
ASL Real Estate Group
You may have seen the social media trend about the benefits of short-term rentals (Airbnb, VRBO, etc.), the catch is simple, if you have a vacation home or other dwelling unit that is non-income producing, you can make it profitable by using it as a short-term rental, vacation or otherwise. This all sounds great but there are unintended tax consequences to consider if the operation of this venture is not set up correctly, which many catchy articles, blogs and posts do not address. Additionally, most every taxpayer is unique so don’t go it alone and heed the well-intentioned advice on social media but simply contact your trusted and knowledgeable tax advisor to determine the best path forward. After all, no one wants to become the next social media post about what not to do. (more…)
Hot Topic in Valuation - Inflation Reduction Act Impact on Business Valuation
By ASL Business Valuation Group
The Inflation Reduction Act provided the Internal Revenue Service (IRS) with $79.4 billion in additional funding to transform tax administration and services. Earlier this year, the IRS released its 2023 to 2031 Strategic Operating Plan that sets forth a framework for using this funding. One of the IRS’s goals is to improve the audit procedures and possibly select more valuation cases for examination. (more…)
Complicated Entity Ownership Reporting Requirements Begin in 2024
By Abe Livchitz, CPA, Senior Manager, Tax & Advisory
ASL Tax Group
In 2021, Congress enacted the Corporate Transparency Act in an effort to provide law enforcement agencies with the ownership information of business entities doing business in the U.S. This information is to be used to help prevent money laundering, the use of shell companies, and other financial crimes. The Treasury Department’s Financial Crimes Enforcement Network (FinCEN, the same agency that administers the foreign bank account reporting rules) was charged with running this program often called “Beneficial Ownership Information Reporting” (BOI). The program’s rules apply very broadly so nearly all privately held businesses will be required to comply beginning January 1, 2024. FinCEN expects over 32 million entities will be filing their initial reporting in 2024. The program was designed to help prevent financial crimes but the compliance burden is falling on privately held businesses across the U.S. and according to recent surveys, most business owners are completely unaware of this new program. FinCEN has created a guide, Small Entity Compliance Guide, FAQs, and informational videos to help businesses understand and comply with these new rules. (more…)
From Heart to Paper: The Essentials of Documentation of Charitable Contributions
By Claire Ding, CPA, Tax Senior
ASL High Net Worth Group
Charitable contribution deductions are one of many deductions that taxpayers frequently claim, and for many, it is a heartfelt way to make a positive impact. The most frequent contributions come in the form of cash, household items, and clothing—items often earmarked for donation during moves or home cleanups. Often, taxpayers don’t realize that proper documentation is necessary. In this article, we will cover the essential substantiation requirements for documenting these donations. (more…)
Multistate Tax Issues - Changing State Income Tax Rules Could Surprise Businesses
Recently updated guidelines from the Multistate Tax Commission (MTC) are generating considerable uncertainty—and growing concern—for companies that do business online. As more states adopt the new guidelines, businesses with a web presence could find themselves subject to unexpected new state income tax liabilities and filing requirements. (more…)
Some RMD Relief from the SECURE 2.0 Act
The SECURE 2.0 Act, enacted in December 2022, made a number of changes to retirement distributions, including the age for receiving required minimum distributions (RMDs), ultimately creating compliance issues for many taxpayers and plan administrators. As a result, in July the IRS provided some relief, issuing Notice 2023-54, relating to certain distributions made in 2023 to individuals that technically were not RMDs as a result of the Act. (more…)
Qualifying as a Real Estate Professional
By Samantha Ramirez, CPA, Manager, Tax & Advisory
ASL Real Estate Group
General Passive Rules
The general passive activity rules under Internal Revenue Code Section 469 define passive activities as any trade or business in which the taxpayer does not materially participate, OR a rental activity without regard to the level of participation. Passive activities that produce losses, can only be offset against passive income. If the taxpayer has no passive income, the losses will be suspended until the activity is sold in a taxable transaction. (more…)