With the new year comes new tax topics for businesses and individuals, but keeping up with the ever-changing business environment doesn’t have to be taxing! Below are the top 10 tax topics we’re keeping an eye on.
- State Pass-Through Entity Tax Election: Individuals who report income through a Partnership or S corporation can indirectly boost their state and local tax deduction in many states, including Ohio.
- Research and Development (including Software): Keep a wary eye on a divided Congress here. Absent legislative change, taxpayers are now required to capitalize and amortize research and development costs. Strangely, these same activities might also qualify for a popular tax credit.
- Employment Tax Credits: The window is still wide-open to claim a refundable payroll tax credit for businesses financially impacted by COVID-19. Employers may also qualify for several other existing hiring credits, including those aiming to incentivize workplace diversity.
- Tax Controversy: $80 billion of additional funding over the next 10 years and an estimated 87,000 new IRS agents means taxpayers must stay on top of compliance and be audit ready.
- State and Local Tax – Nexus: A remote work environment expands many companies’ physical presence and tax filing footprints. Without physical presence, states are rapidly changing laws to impose “economic nexus” on remote sellers, creating additional sales/use tax and income tax compliance obligations.
- Energy Tax Credits: Many new and expanded energy tax credits are available for businesses and individuals.
- Succession/Exit Planning and Execution: Planning and executing a successful business sale (or purchase) requires proper analysis of organizational structures, tax exposures, transaction costs, tax modeling/mitigation, and much more.
- Estate and Gift Planning: The expanded lifetime estate tax exemption is set to expire at the end of 2025. Significant wealth transfer (including business interests) requires careful tax planning for transitioning to the next generation.
- Inventory Methods: The rising cost of inflation and changing IRS regulations require a fresh look at methods of accounting for producers and resellers of inventory.
- International Tax Reporting: IRS reporting requirements related to international matters have increased substantially in scope and complexity with draconian penalties for non-compliance.
Our tax experts stand ready to empower growth. Contact GBQ today.