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Recent Money Market Fund Regs Hurt Manufacturers

February 16, 2018

The Securities and Exchange Commission (SEC) passed a rule, effective October 2016, which requires money market funds (MMFs) to switch from a fixed net asset value (NAV) to a floating NAV, causing many MMF managers to liquidate their funds and exit the MMF business.

This rule negatively affects manufacturers by:

1) Causing borrowing costs to rise above the Fed’s recent interest rate increases;

2) Reducing potential return on short-term cash flow investments.

Join a brief webinar on Thursday, Feb. 22 at 10:00 a.m. to hear a complete explanation of the issue from experts at OMA Connections Partner, Roetzel, and learn what businesses can do to fix this problem. Register here. 2/14/2018

New Budget Agreement Brings Additional Tax Changes

February 16, 2018

This just in from OMA Connections Partner, Clark Schaefer Hackett: “… The Bipartisan Budget Act of 2018 (BBA), which President Trump signed into law on February 9, 2018, contains several tax-related provisions that could reduce the amounts some taxpayers owe for the 2017 tax year.”

And: “The BBA’s inclusion of provisions applying retroactively to 2017 taxes is sure to cause some confusion, particularly for those taxpayers who have already filed their tax returns. The IRS has indicated that it’s reviewing the BBA and plans to provide additional information as quickly as possible. …”

Read about these provisions here. 2/15/2018

Tax Reform and Pass-Through Entities

February 16, 2018

OMA Connections Partner, Gilmore Jasion Mahler LTD, offers insights into the pass-through entity income tax changes that came about as a result of tax reform. 2/15/2018

Use New Withholding Tables Not Later than February 15, 2018

February 9, 2018

The Internal Revenue Service (IRS) has released IRS Notice 1036, Early Release Copies of the 2018 Percentage Method Tables for Income Tax Withholding. The notice updates the income tax withholding tables for 2018, reflecting changes made by the Tax Cuts and Jobs Act.

Employers should begin using the 2018 withholding tables as soon as possible, but not later than February 15, 2018. The new withholding tables are designed to work with the Forms W-4 that workers have already filed with their employers. 2/5/2018

Understanding Qualified Business Income Deduction Eligibility

February 9, 2018

According to OMA Connections Partner, Clark Schaefer Hackett: “Small business owners received a substantial benefit with the passage of the Tax Cuts and Jobs Act in December 2017. Owners of pass-through entities, including shareholders in S corporations, partners in partnerships and sole proprietors, are now eligible for a 20% deduction on “qualified business income.” Not all income qualifies for the deduction, however. One type of income, guaranteed payments, is not eligible for the deduction. But careful analysis to ensure that items are correctly classified, as well as possible restructuring of this income, could allow organizations to benefit from the new deduction.”

Read more from CSH here. 2/7/2018

IC-DISC after Tax Reform – Still Viable?

February 2, 2018

The IC-DISC (interest charge domestic international sales corporation) survived the Tax Cuts and Jobs Act of 2017 (TCJA). For those who may not be familiar with the IC-DISC, it is an export incentive for U.S. domestic companies whereby income related to export sales can be taxed at a lower capital gain rate.

OMA Connections Partner, Clark Schaefer Hackett (CSH), commented: “While this is great news for companies that have taken advantage of the IC-DISC in the past, other provisions of the new sweeping tax reform may still impact your IC-DISC starting in tax year 2018. Therefore, it’s very important to include the IC-DISC when you consider the impact of the overall tax reform changes to your company.”

Read more about this from CSH here. 1/26/2018

R&D Tax Credit – Why Didn’t I get my Payroll Tax Refund?

February 2, 2018

Beginning in 2016, certain eligible small business taxpayers were able to utilize the IRC Sec. 41 Research Tax Credit to reduce a portion of their payroll taxes.

The process required to claim and utilize the offset has led to some confusion. Thus, puzzled taxpayers are now questioning why they haven’t received their payroll tax refund, even though they elected the option on their Form 6765.

The team at OMA Connections Partner, Tax Credits Group, indicates this is one of the most common questions it has addressed this year. They explain it here. 1/31/2018

C corporation? Pass-through? How Tax Reform Could Affect Your Decision

February 2, 2018

OMA Connections Partner, Clark Schaefer Hackett (CSH) posted: “With all the changes in the taxation of businesses enacted under the 2017 Tax Cuts and Jobs Act (Act), many business owners wonder whether they need to revisit the business entity decisions they made when they organized their businesses. The changes under the new Act that are causing questions about optimal tax entity structure include reduction of the tax rate on C corporations to 21%, introduction of the new 20% deduction on qualified business income from pass-through entities, and the repeal of the corporate alternative minimum tax.”

More on the topic from CSH. 1/31/2018

RS Issues Updated 2018 Withholding Tables

January 26, 2018

OMA Connections Partner, Clark Schaefer Hackett (CSH), posts: “In the wake of passage of the Tax Cuts and Jobs Act (TCJA) late last year, the IRS has taken one of the first critical steps to institute the law’s overhaul of the federal income tax regime. The IRS has released updated withholding tables that indicate how much employers should hold back from their employees’ paychecks to satisfy workers’ tax obligations. The new tables may provide the correct amount of tax withholding for individuals with simple tax situations, but they’ll likely cause other taxpayers to not have enough withheld to pay their ultimate tax liabilities under the TCJA.”

Read further analysis from CSH about the new tax tables1/19/2018

Accounting for Meals and Entertainment Under the New Tax Act

January 26, 2018

This from OMA Connections Partner, Clark Schaefer Hackett: “… Although we are anxiously awaiting more guidance regarding many provisions of the new law, the accounting for meals and entertainment expenditures is one area where businesses need to take immediate action.”

Here is guidance from CSH. 1/22/2018