Act 42 Lays Down Local BPT Landmines

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James J. Newhard, CPA, CGMA is owner of James J. Newhard, CPA and CPE presenter for Loscalzo Associates, Ltd.

By Guest Blogger, James J. Newhard, CPA

Court case after court case have asked whether the business privilege/mercantile tax (BPT) was based on physical presence or privilege. Act 42 clears it up. But maybe not to your liking.

Effective Jan. 1, 2014, Act 42 sets the Pennsylvania (but not Philadelphia) nexus trigger for when a business must register and file a BPT return in a local jurisdiction.

Now, a business has registration and filing nexus whether it either (1) conducts business in a jurisdiction for all or part of 15 days in the tax year, or (2) has a base of operations in that jurisdiction. Continue reading

Tangible Property Tangle

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PICPA members discuss recent issues at Greater Philadelphia’s Q&A with the IRS.

Over the past few weeks, PICPA members have expressed serious concerns over meeting reporting requirements related to tangible property regulations and the required Form 3115 submission for the tax year ended Dec. 31, 2014. On Friday, Feb. 13, IRS announced that they are giving some relief to practitioners.

The PICPA has been working with Pennsylvania legislators and the IRS to create awareness of the issues related to the new regulations. Many PICPA members have volunteered their time and efforts in this area; most notably PICPA past presidents Cheri H. Freeh, CPA, and Eric P. Wallace, CPA. As highlighted in an article from 2014, Cheri is actively representing the profession on the IRS Advisory Council (IRSAC). Twenty members from across the country serve on this advisory body. Eric has devoted a significant amount of time and energy to creating resources for other CPAs to understand and implement the new regulations.

While many firms have addressed already-filed 3115s for their clients, other practitioners are still trying to gain a better understanding of the issue. At a recent Greater Philadelphia Chapter Q&A with the IRS, IRS Senior Stakeholder Liaison Richard Furlong heard feedback from practitioners at various stage of implementation. (PICPA member Karen Facer-Mee, CPA, put in a tremendous amount of effort to pull this program together. Thank you, Karen!) Rich did note that the IRS expects 20 million 3115s to be filed this year, which is no small matter for the IRS.

Just this past week, AICPA issued a Special News Update e-mail on the topic.

For those still navigating this complex issue, the PICPA has compiled the following resources to help:

The PICPA will continue to work with its members to provide up-to-date information on this topic as it becomes available. If you have any recommendations or suggestions as to how PICPA can assist you with this topic, please do not hesitate to contact us.

Nine Deductions Taxpayers Can Take Even if They Don’t Itemize

By Guest Blogger, John Steffee, CPA

John-Steffee

John Steffee, CPA is a shareholder in Pfister and Rompalo, PC in Wormleysburg, PA with over 35 years of experience.

The IRS allows certain deductions from your income before you need to compute your tax liability. Depending upon your filing status and your personal circumstances over the past year, you need to determine if you are going to itemize your deductions or take what the IRS defines as the “standard deduction.” This standard deduction is a dollar amount that non-itemizers may subtract from their income based upon their filing status: single ($6,200), married filing jointly ($12,400), married filing separately ($6,200), head of household ($9,100), and qualifying surviving spouse ($12,400). Taxpayers who are at least 65 or who are blind may increase their standard deduction by $1,200 if they are married and $1,550 if they are single or a head of a household. The IRS provides an online tool to help you compute your standard deduction.

Taxpayers opting for the standard deduction, however, do have additional considerations available to them for reducing their tax bill that are known as “above-the-line” deductions. The following above-the-line deductions are available to taxpayers who do not itemize all deductions and opt for the standard deduction. Continue reading

Are Soft CPA Exam Results in 2014 Something to Worry About?

If you passed the CPA Exam in 2014, be proud that you are part of an elite group. According to the National Association of State Boards of Accountancy’s (NASBA) 2014 Uniform CPA Examination Candidate Performance book released in early February 2015, the number of successful candidates fell both in Pennsylvania and nationwide.

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Continue reading

Public Charity Bill Would Add Certainty, Clarity

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The Pennsylvania Senate is debating a measure that will help ensure that institutions of purely public charity in the state are provided with a property and sales tax regime that is more certain and predictable.

Among the many services CPAs provide, they help individuals, businesses, and charitable entities with tax planning. Tax planning is essential in preparing for a business’s fiscal year. Providing as much certainty on the debit side of the ledger places the taxpayer in a position to thrive in today’s economy. Shouldn’t public charities, which provide essential services to our communities, be afforded the same amount of certainty as others in their tax planning?

The Pennsylvania Senate is debating a measure that will help ensure that institutions of purely public charity in the state are provided with a property and sales tax regime that is more certain and predictable. Senate Bill 4, which would amend our state constitution, returns the power to determine property and sales tax exemption criteria for purely public charities back to the legislature. This bill is necessary because the state Supreme Court upended what was, for the past 15 years or so, a relatively stable and unambiguous area of the law. Continue reading

Tax Issues for Pennsylvania Gas Leases and Royalties

By Guest Blogger, Nancy Montanye, CPA

Nancy-Montanye

Nancy G. Montanye, CPA, is a sole practitioner in Williamsport, Pa.

If you are a Pennsylvania landowner with mineral rights who is offered a lease from a gas company, congratulations! This windfall, however, may raise many questions for you. In this blog post I hope to address some basic issues related to natural gas leases and royalties in Pennsylvania.

Natural gas in the Marcellus Shale only recently became accessible through fracking technology. Though Pennsylvania has the oldest oil well in the country and established legislation and case law related to mineral rights years ago, with the development of gas wells the state continues to update its rules and regulations for the industry and landowners. Continue reading

Busy Season Resources for All

The IRS is underfunded and under-resourced, operating on the equivalent of 2009 dollars. Congress again delayed approving federal tax extenders, and tax provisions of the Affordable Care Act are now in play. Add to all this the IRS repair regulations. The 2015 busy season is shaping up to be one of the most challenging in years. To help navigate the changes and challenges that will be faced over the next several months, the PICPA has numerous resources for both members and consumers.

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Download and print this list of “Top 10 Reasons a CPA Should Prepare Your Tax Return” to share with friends, family, and clients.

For members, the PICPA website resources including discounts on CCH and Quickfinder publications, on-demand continuing education programs on hot topics such as repair regulations, breaking news on tax topics, and the TaxAware Center, a 24-hour news aggregate of federal and state tax topics. There is also a Per Diem Directory for members looking to add resources, and brochures available to distribute to clients, including both federal and state tax tips, protecting investments from fraud, Pennsylvania inheritance tax, and top 10 reasons a CPA should prepare your tax return. Continue reading