Zinner & Co. Blog and Newsroom

Groundbreaking Sales & Use Tax Case Decided by the Supreme Court

Posted by Matt Szydlowski, CPA on Jun 29, 2018 8:38:52 AM

By Matt Szydlowski, CPA

On June 21, the Supreme Court handed down a landmark decision in South Dakota vs. Wayfair (“Wayfair”).   The fallout of this decision will significantly change the way online vendors handle sales and use (“S&U”) tax for out-of-state consumers going forward.  It will, therefore, also affect online consumers.  Are you impacted!?

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Topics: Taxes - Corporate & Business, Taxes - Planning, Rules and Returns, Taxes - Individual, taxes

Kass completes term as President of the Cleveland/Akron Chapter of the Society of Financial Service Professionals

Posted by Zinner & Co. Tax Department on Jun 28, 2018 3:25:00 PM

In June, Zinner & Co. Partner Howard J. Kass, CPA, AEP®, CGMA, finished his one-year term as president of the Cleveland/Akron Chapter of the Society of Financial Service Professionals (CAFSP).

A CAFSP member since 2010, Kass was thankful for the support he received from the organization’s officers and board members during his term.

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Topics: leadership, Howard Kass

Zinner & Co. Partner wins Rainmaker Award

Posted by Zinner & Co. Tax Team on Jun 28, 2018 2:12:00 PM

Zinner & Co. LLP Partner Susan Krantz, CPA, CGMA, was honored with a prestigious Rainmaker award as the Nonprofit Certified Public Accountant (CPA) member of the year.

Presented during the Rainmaker Companies’ annual SuperConference, held in Indianapolis from May 31 through June 2, the award is given annually to a member best described as someone who is a constant source of value to other members. Other criteria include an individual who engages in group activities and contributes to the success of the alliance through leadership, collaboration and the sharing of resources and best practices.

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Topics: Sue Krantz, not-for-profit

Rethinking retirement contributions

Posted by Zinner & Co. Tax Team on Jun 11, 2018 3:47:00 PM

The Tax Cuts and Jobs Act of 2017 generally lowered federal income tax rates, with some exceptions. Among the ways in which lower rates impact tax planning, they make unmatched contributions to traditional employer retirement plans less attractive.

Example 1: Chet Taylor has around $100,000 in taxable income a year. Chet contributed $12,000 to his company’s traditional 401(k) in 2017, reducing his taxable income. He was in the 28 percent tax bracket last year, so his federal tax savings were $3,360 (28 percent of $12,000). An identical contribution this year will save Chet only $2,880, because the same income would put him in a lower 24 percent bracket.

Not everyone will be in this situation.

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Topics: Taxes - Planning, Rules and Returns, Retirement Planning & IRAs, Tax Cuts and Jobs Act of 2017

IRS Okays home equity deductions

Posted by Zinner & Co. Tax Department on Jun 7, 2018 12:30:00 PM

The Tax Cuts and Jobs Act of 2017 affected the tax deduction for interest paid on home equity debt as of 2018.

Under prior law, you could deduct interest on up to $100,000 of home equity debt, no matter how you used the money. The old rule is scheduled to return in 2026.

The bad news is that you now cannot deduct interest on home equity loans or home equity lines of credit if you use the money for college bills, medical expenses, paying down credit card debt, etc.

The good news is that the IRS has announced “Interest on Home Equity Loans Often Still Deductible Under New Law.”

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Topics: real estate, financing, Taxes - Planning, Rules and Returns, Taxes - Individual, home, Tax Cuts and Jobs Act of 2017

Proposed legislation supports unlimited above-the-line charitable contribution deduction

Posted by Zinner & Co. Tax Team on Jun 1, 2018 9:01:00 AM

iStock-898841732A proposed bill has the potential to put taxpayers in a charitable mode.

U.S. Rep. Chris Smith (R-NJ) and U.S. Rep. Henry Cuellar (D-TX) recently introduced the “Charitable Giving Tax Deduction Act,’ a bipartisan bill that would make charitable tax deductions “above-the-line,” allowing taxpayers to write off charitable donations without limitation, whether or not they choose to itemize.

The proposed bill would address concerns that changes made by the Tax Cuts and Jobs Act will result in fewer taxpayers itemizing their deductions, reducing the tax incentive to make charitable contributions. 

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Topics: Taxes - Individual, Tax Cuts and Jobs Act of 2017

Relief for taxpayers affected by reduction of maximum deductible health savings account contributions

Posted by Zinner & Co. Tax Team on May 22, 2018 12:57:49 PM

Taxpayers who have healthcare coverage under a High Deductible Health Plan (HDHP) may qualify for tax relief from the Internal Revenue Service.

HDHPs, health insurance plans with lower premiums and higher deductibles than a traditional health plan, are a requirement for having a health savings account.

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Topics: IRS, health care

The new tax law will change divorce tactics

Posted by Zinner & Co. Tax Team on May 7, 2018 2:55:00 PM

When couples divorce, financial negotiations often involve alimony. The tax rules regarding alimony were dramatically changed by the Tax Cuts and Jobs Act (TCJA) of 2017, but existing agreements have been grandfathered. In addition, the old rules remain in effect for divorce and separation agreements executed during 2018. Next year, the rules will change, and the roles will be reversed.

Under divorce or separation agreements executed in 2018, and for many years in the past, alimony payments have been tax deductible. Moreover, these deductions reduce adjusted gross income, so they may have benefits elsewhere on a tax return. While the spouse or former spouse paying the alimony gets a tax deduction, the recipient reports alimony as taxable income.

Shifting into reverse

Beginning with agreements executed in 2019, there will be no tax deduction for alimony. As an offset, alimony recipients will not include the payments in income.

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Topics: alimony, divorce, Taxes - Planning, Rules and Returns, Taxes - Individual, taxes, tax avoidance, Tax Cuts and Jobs Act of 2017

No Good Deed Goes Unpunished

Posted by Howard J. Kass, CPA, AEP®, CGMA, Partner on May 4, 2018 2:47:00 PM

One Effect of the Recent Tax Reform on Not-for-Profit Organizations

By Howard J. Kass, CPA, CGMA, AEP®

As often as employers are maligned, there are times where they try to do the right thing for their employees.  To be fair, many times, an employer may take an action or incur an expense that benefits its employees, knowing that the employer will benefit by a tax deduction for incurring an expense.  In some cases, Congress encourages such behavior by explicitly permitting favorable tax treatment for certain programs.

One such case was a set of fringe benefits known as the “qualified transportation fringe” benefits that, in fact, received a double-barreled tax benefit for years, by virtue of Internal Revenue Code Section (IRC) 132(f)(5)(C).  Under that section, employers were allowed to take a deduction for, among other things, qualified parking fringe benefits that they provided to their employees. What, exactly, was a qualified parking fringe benefit?  Under IRC 132(f)(5)(C), “qualified parking” meant parking provided to an employee on or near the business premises of the employer, or on or near a location from which the employee commutes to work by transportation described in Code Sec. 132(f)(5)(A) (relating to “transit passes”), in a commuter highway vehicle, or by carpool

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Topics: tax, taxes, not-for-profit, Tax Cuts and Jobs Act of 2017

“Kiddie Tax” impacted by Tax Cuts and Jobs Act

Posted by Zinner & Co. Tax Team on Apr 18, 2018 12:39:00 PM

Many higher income taxpayers have long made it a practice to open investment accounts for their children, hoping to take advantage of their lower tax rates.  Many years ago, Congress imposed, what is colloquially known as the “kiddie tax” to place strict limits on the amount of investment income that can be taxed at those lower rates. 

One of the changes made by the recently enacted Tax Cuts and Jobs Act of 2017 made some significant changes to how the “kiddie tax” is administered, impacting the way adults pass investment income on to their minor children. 

The "kiddie tax" is a provision that taxes the unearned income of children under the age of 19 and of full-time students younger than 24 at a special rate. Under both the new law and the old, the first $1,050 of a child's income is tax-free and the next $1,050 is taxed at a rate of 10 percent.

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Topics: tax services, Taxes - Planning, Rules and Returns, Taxes - Individual, Retirement Planning & IRAs, withdrawls, tuition, tax avoidance, Tax Cuts and Jobs Act of 2017

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