• Using an LLC for Ownership of a Vacation Home

    I am frequently asked if a limited liability company (LLC) should be used to purchase a second residence. It is often an excellent choice for clients. There are many benefits of owning a residence in the name of an LLC.
  • Targeted Teaching Key to “Flipping” the Classroom

     One of the hottest trends in education has been the advent of the flipped classroom. In a traditional classroom, the professor presents the material, demonstrates it, and asks for any lingering questions. A flipped classroom jumps directly to the questions stage.
  • Health Care Valuations Present Unique Challenges

    Health care expenditures in the United States will top $3.5 trillion this year, which is about 18% of the gross domestic product. The provider sector is undergoing dramatic change in the form of mergers, consolidation, and new partnerships. All of these actions require business valuation services.
  • Client Board Meetings Offer Opportunity to Shine, but Don’t Trip Over Legal Line

    The board of directors of a corporation should meet annually, if not more frequently. Partnership agreements, too, commonly require an annual meeting (at minimum). Agenda items for these meetings may include election of officers and directors, decisions concerning distributions, officer compensation, retirement plan contributions, review and approval of loans to shareholders, and ratification of key management decisions made during the year.
  • Practice Integration Imperatives

    Negotiating the terms for a CPA practice transfer or merger is the most important step in setting the stage for a successful transaction. Nearly as important, but often overlooked, is having a well-designed integration plan.
  • Consider Section 962 to Mitigate GILTI Inclusions

    Individuals from the United States who are shareholders (including estates and trusts) of controlled foreign corporations (CFCs) face a difficult path in how to structure these investments in a tax-effective manner. The Tax Cuts and Jobs Act of 2017 (TCJA) treats U.S. corporate shareholders more favorably than U.S. individuals with regard to investments in CFCs. The TCJA has a new global intangible low-taxed income (GILTI) inclusion as part of the U.S. Subpart F anti-deferral rules that expands inclusions from CFCs to individual shareholders who are federally taxed at up to 37%. It also creates a double taxation event because individuals are not entitled to a credit for underlying foreign taxes paid in the income included.
  • Emerging Technologies Will Impact More than Office Duties

    Emerging CPAs must educate themselves on the impact innovative technological advancements will have beyond their day-to-day office work, particularly in the areas of licensure requirements, certification examinations, and the future of the profession.
  • Tax Notice Management Is Critical

    Part of the tax function is to address and resolve state and local tax notices from departments of revenue. Notices may be issued for various reasons, such as nonfiling, late filing, underreported tax, late payment, nexus inquiries, or various state updates. All should be reviewed and addressed immediately.
  • Penalty Abatement Opportunities after Chai v. Commissioner

    In 2017, the U.S. Court of Appeals for the Second Circuit issued a decision that significantly affected IRS procedures for the assessment of penalties against individuals and other taxpayers. The IRS is now required to possess contemporaneous evidence that a revenue agent’s supervisor approved a penalty before it was assessed. The Tax Court has expanded this rule over the past two years, so it now has significant teeth.
  • With Financial Reporting, It’s All about Disclosure

    Whenever I hear the expression, “the only easy day was yesterday,” I know that person was either in the military or a CPA in public practice. OK, perhaps that’s an exaggeration … but not by much. To practice in financial reporting requires extraordinary knowledge of disclosures. After all, disclosure is to financial reporting what location is to real estate – everything!
  • Unexpectedly Displaced: Calculating Economic Losses for a Boss Is No Simple Task

    When calculating income losses for individuals due to catastrophic loss, personal injury, wrongful death, or discrimination claim, a forensic accounting expert needs to consider numerous components, including the concept of earning capacity, applicable case law, worklife probabilities, and expert opinions, among others. Earning capacity is arguably the most important component for an income loss calculation, and it can be very challenging when it comes to business owners.
  • Career Crossroads: Understanding Nonprofits before You Switch Jobs

    Professionals in nearly every industry will sometimes reach a point where they begin looking for deeper meaning in their work. For many, including CPAs, a transition to the not-for-profit sector, to a mission-focused organization, provides a sense of purpose and an opportunity to give back.
  • Risk Assessments: From Paper to Practice

    Successful risk awareness cultures are those in which employees at all levels of the organization recognize the crucial nature of managing risk. Too often, risk assessment and risk management initiatives die prematurely because there is a lack of ownership or committed responsibility over the process. Interestingly, this absence of commitment to the process exists because “What do we do with it?” goes unanswered by leadership. This article highlights how risk assessments can be more than a concept and become a critical component of an organization’s success strategy.
  • You Guide Our Strategic Direction

    Technological advances and workforce changes are some of the driving factors behind a rapid pace of change. The PICPA is fortunate to have engaged volunteers who serve in leadership and committee roles and share their perspectives and insight to help the PICPA stay laser-focused on providing value to members.
  • New Tool for Bolstering CPA Exam Candidates

    Nearly every year for the past decade, the number of accounting graduates across the United States has risen. However, the number of candidates sitting for the CPA Exam has either remained flat or declined. This troubling trend has generated a lot of interest and study into probable causes and contributing factors.
  • Legislation in Full Bloom in Harrisburg

    With nearly 50 freshmen joining the 2019-2020 General Assembly in January and several new chairs taking the reins of key committees, legislation had been relatively slow moving through the process in the early part of the session in Harrisburg. Bills finally are starting to fill the calendars of both chambers, and PICPA’s government relations team and volunteer committees are busy at work reviewing dozens of proposals and providing technical assistance where necessary. At the same time, the PICPA is working to position several bills we are championing. Here’s a look at the status of PICPA’s legislative agenda.
  • Disposing of IRC 197 Intangibles: It’s All or Nothing

    In a column published in last summer’s Pennsylvania CPA Journal, we discussed why we anticipated seeing more asset deals among mergers and acquisitions as a result of certain changes brought on by the Tax Cuts and Jobs Act of 2017. This includes deemed asset purchases via an Internal Revenue Code Section 338(h)(10) election. Taxpayers would receive the benefit of getting a stepped-up basis in the assets acquired and resulting depreciation (including immediate expensing via bonus depreciation) and amortization deductions to follow.
  • Cybersecurity for Benefit Plan Sponsors and Auditors

    Employee benefit plans are ripe with information that may be vulnerable to a data breach. Protecting plan information is often overlooked by plan sponsors when devising their cybersecurity strategies. However, Employee Retirement Income Security Act (ERISA) Section 404 requires benefit plan sponsors and other fiduciaries to administer plans with the “care, skill, prudence, and diligence under the circumstances that a prudent person acting in a like capacity and familiar with such matters would use.”
  • Cross Over the Missing Middle to Secure Succession Plan

    In more than 30 years of working with privately owned businesses, I have too often seen what can only be described as an ongoing blind spot regarding succession planning and the requisite good governance that should underlie it. This is an odd outcome for a group of individuals who are generally committed to family, community, and building a legacy.
  • Retirement Readiness: An Employer’s Role

    Retirement readiness was discussed in the spring 2019 Pennsylvania CPA Journal, but it focused on the employee’s responsibilities with regard to savings. Here, we look at a different angle. When it comes to retirement planning, employers also have an important role.
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