January 2018 Article Archives

A new global survey via professional services network World Services Group found that among young professionals in North America (as well as the rest of the world), work-life balance was the biggest priority in their professional lives, beating out wealth and leadership opportunities. 

The Generation Now Survey, which polled over 1,500 young professionals across 84 of the World Services Group's professional service firms, sought to dig deeper into the millennial workforce and find out what made a "generation that many understand to be different from those that have gone before it" tick. 

The lower corporate tax rate under the new tax law spurred some confusion for corporations whose taxable years don’t begin on January 1. 

Tax professionals have been practically unanimous in their expectations for guidance from the Treasury Department on how to interpret and follow the new tax law. But on this issue — application of the new corporate rate to companies with a non-calendar taxable year — they shouldn’t have to wait at all, as the answer lies in Section 15 of the Internal Revenue Code.

An auditor’s report gives lenders confidence that financial statements are free of material misstatement. But does the auditor’s report really tell the story of what the auditor did to gain assurance about the financial statements? Thanks to proposed changes to the auditor’s report, readers will gain a better understanding of what the auditor did and observed. 

The AICPA Auditing Standards Board (ASB) has released a set of exposure drafts  aimed at enhancing the relevance and usefulness of the auditor’s report.

The IRS issued new income tax withholding tables that reflect new tax rates and other changes for individuals implemented by P.L. 115-97, known as the Tax Cuts and Jobs Act, enacted Dec. 22 (Notice 1036). Employers should use the updated withholding rules for 2018, putting them into effect as soon as possible but no later than Feb. 15, the IRS said. Until then, employers should continue to use the 2017 withholding tables. 

The IRS noted that many employees should begin to see their take-home pay increase in February depending on how quickly their employers implement the new tables and whether they are paid weekly, biweekly, or monthly. The new withholding tables are designed to work with Forms W-4, Employee’s Withholding Allowance Certificate, that employees already have on file, so employees do not have to fill out new ones at this time. The IRS plans on issuing a new Form W-4 in the near future. It is also working on revising the withholding tax calculator available on its website, which it expects will be finished by the end of February. 

Businesses—especially smaller firms—may scale back on treating clients to major league baseball games, golf outings and the like after Congress and President Donald Trump ended a tax break for such entertainment. 

The tax overhaul that Trump signed Dec. 22 eliminated a 50 percent deduction for business-related expenses for “entertainment, amusement or recreation.” Suddenly, luxury boxes at stadiums and arenas—along with theater and concert tickets—will be more costly for firms that use them to woo clients. 

By the time you read this post, it is likely that President Trump has already signed the new Tax Act. Today’s post has been prepared by Rebecca Smith.  She is our director of tax for cooperatives.  This post if fairly long, but we want to get the information to our cooperative clients.  We would strongly suggest talking the tax bill over with your tax advisor now since there may be some actions needed before year-end.  

Tax Reform overall appears to be a win for cooperatives as well as their patrons.  A key change is the repeal of the Section 199 deduction which many cooperatives and their patrons have benefited from since its inception in January 2005. For cooperatives that currently benefit from the deduction and/or pass it through to patrons please consult your tax advisor prior to December 31^st to discuss the implications.