In this issue: PICPA’s Annual Q&A with Department of Revenue; Busy Week in the Pennsylvania Senate; State Senator Wants to Eliminate Pa. PIT, SUT; and more.

In this issue: Pa. Judicial Elections Have Big Implications; Philadelphia Tax Relief for Victims of Hurricane Ida; Bill to Increase Pennsylvania Corporate Net Loss Deduction Limitation; and more.

I was living a professional life best described as 10 miles wide and a millimeter deep. I was “busy” all the time, but was I really accomplishing anything? What could I possibly create in the scattered half-hours between meetings, with only enough time to check the emails that I hadn’t already distracted myself with during those same meetings? That’s when I stumbled upon Deep Work: Rules for Focused Success in a Distracted World by Cal Newport. I was drawn to the book’s title: “Deep Work.”

In this issue: PICPA Outlines Tax Policy Concerns at State House Hearing; IRS Service Levels Continue to Founder; Pa. Board of Appeals Updates Operating Procedures; and more.

In this issue: PICPA Offers Tax Policy Ideas at Pa. House Hearing; Pa. Legislature Extends Pandemic Regulation Waivers; Pennsylvania DOR's Data Center Tax Exemption Program; and more.

In this issue: Pennsylvania Lawmakers Convene for Fall Session; Pa. Provides More Detail on Filing Extension Due to Ida; Department of Revenue-PICPA Quarterly Meeting; and more.

In this issue: Tax Relief for Pennsylvania Ida Victims; Audit Quality Assessment of EBP Plans Coming; Pa. DOR Updates Two Tax Bulletins; and more.

In this issue: Pa. DOR Business Tax Notice of Penalty Adjustment; AICPA's IRS Penalty Relief Campaign; Pennsylvania Bipartisan Election Reform Measure Proposed; and more.

The Tax Cuts and Jobs Act became law in December 2017, and now private companies and their investors must consider how the changes in tax law impact business valuations. Specifically, stakeholders should consider how the Tax Act impacts their projected cash flows and the inputs and assumptions that drive the estimation of enterprise value.

Professional ethics is a key source of credibility for the CPA profession. But what about conduct outside the office and its effect on your professional life? With the rise of social media’s prevalence, we have seen in numerous high-profile controversies how actions in a personal context can have dire professional implications.

In June 2018, the U.S. Supreme Court altered five decades of perspective regarding where an entity is “doing business.” Certainly, there are significant implications for tax compliance, but there are also immediate financial reporting issues for companies reporting under generally accepted accounting principles.

Recently enacted changes under the Pennsylvania Uniform Limited Liability Company Act will have a dramatic impact on the governance of limited liability companies in Pennsylvania. The act took effect on April 1, 2017, and because LLCs are the most frequently used legal entity, it is essential that CPAs understand the new rules.

It is said that all good things must come to an end. This thought was foremost in my mind as I prepared my final column for the Pennsylvania CPA Journal. Forty-two years after I began my PICPA journey, including the last 10 years as your CEO and executive director, I look back with great satisfaction and gratitude that this opportunity was provided to me.

With less political drama than typically accompanies the budget process, the Pennsylvania General Assembly approved on June 25 a $40.8 billion spending plan for the 2021-2022 fiscal year (FY) that began July 1. State lawmakers passed the budget with bipartisan support: 43-7 in the Senate and 140-61 in the House. Gov. Tom Wolf signed the budget bill – which does not include the tax changes he had proposed – on June 30.

Developing and cultivating the next generation of leaders and owners is a crucial part of any healthy CPA practice. While succession in CPA firms has received a lot of attention – even to the level of anxiety – for a very long time, not enough firms have figured it all out. In fact, according to the 2020 Rosenberg Survey, only a little more than half of the firms surveyed of all sizes had a written, approved succession plan in place. That percentage is far lower in smaller firms.

If a U.S. person makes a minority investment internationally, a determination must be made as to whether or not the investment is considered a passive foreign investment company. Distributions from, and sales of, PFICs are taxed at ordinary income tax rates coupled with a complex anti-deferral interest charge. Many foreign mutual funds are PFICs, as are certain foreign stocks. There are many times, however, when a PFIC investment is made unknowingly and the tax consequences can be adverse. Certain elections should be considered that can lessen the tax implications, but it can be difficult obtaining the financial information necessary to determine whether or not the investment is a PFIC.

When COVID-19 hit, an expansion of telecommuting in the workforce was already a growing trend. According to the National Study of Employers, by 2016 more than 66% of employers already allowed employees to work some regular paid hours at home at least on an occasional basis, and 40% allowed such work on a regular basis. By spring 2020, work-from-home accounted for 52.3% of all employment, a significant increase from pre-COVID-19 statistics. Working from home freed 62.4 million hours per workday for all U.S. workers that had been consumed by commuting. The question is, how was that time spent and what purposes did it serve?

Due to the impact of COVID-19 on the nuts and bolts administration of justice, there is a particularly troublesome backlog in the court system. Legislators at all levels and court watchdog groups are proposing methods to streamline the litigation process. One solution that may be gaining traction is the use of alternative dispute resolution, such as mediation.

With the pandemic and its consequent economic turmoil, new challenges and questions arose for companies, including the power and limits of business insurance coverage. To explore the pandemic’s impact on insurance coverage, I spoke with Todd Rhoads, vice president and professional services practice group leader at EHD Insurance. I wanted to find out what he is seeing in the business insurance arena.

An organization’s legal entity structure should link its tax efficiency, business purpose, strategic direction, and operational effectiveness. An efficient structure creates value for its public or private owners, provides clarity for its employees, and reduces the overall cost structure. This is true whether an organization has two legal entities or a sprawling organizational chart.