28 Feb 2022
0

SB 113 Provides Additional Relief from SALT Deduction Limits

Roger Rossmeisl, CPA
Automotive, Individual Tax Briefs, Small Business Tax Briefs
SB 113 Provides Additional Relief from SALT Deduction Limits

Back in 2017, the Tax Cuts and Jobs Act was signed into law which instituted a cap on the amount of state and local taxes (SALT) that individuals could report as Itemized Deductions on Schedule A.  Starting with the 2018 tax year, the maximum SALT deduction available was $10,000. Previously, there was no limit.  Since then, roughly 20 states have come up with workarounds intended to negate, or at least mitigate the effect of the SALT limitation. In 2021 California passed AB 150, which provides that, in the taxable years 2021-2025, a so-called "qualified entity" (a S corporation, partnership, or LLC taxed as a partnership or S corporation) to make an election to pay a new pass-through entity (PTE) elective tax equal to 9.3% of its...

21 Feb 2022
0

Don’t Discount the Key Person Discount

Roger Rossmeisl, CPA
Automotive, Valuation Briefs
Dont Discount the Key Person Discount

In the fourth quarter of 2021, CEO resignations were up 16% over the prior year, according to executive outplacement firm Challenger, Gray & Christmas. Recent and announced high profile departures include Twitter’s Jack Dorsey, Amazon’s Jeff Bezos and American Airlines’ Doug Parker. This trend is expected to continue into 2022 as executives swap high-stress positions for more family time. Would your business survive if its CEO or founder suddenly jumped ship? Large public companies often have deep management structures and succession plans in place. So, they can usually recover from the loss of a C-level executive over time, except in rare instances. It’s more common for smaller businesses to depend heavily on a key person — and the actual, or even the potential, loss of that...

11 Jan 2022
0

When Subsequent Events Count

Roger Rossmeisl, CPA
Automotive, Valuation Briefs
When Subsequent Events Count

The value of a business interest is valid as of a specific date. The effective date is a critical cutoff point because events that occur after that date generally are not taken into account when estimating value. However, there are two key exceptions when subsequent events count. (1) When an event is foreseeable Subsequent events that were reasonably foreseeable on the effective date are usually factored into a valuation. That’s because, under the definition of fair market value, hypothetical willing buyers and sellers are presumed to have reasonable knowledge of relevant facts affecting the value of a business interest. Examples of potentially relevant subsequent events are: An offer to purchase the business, A bankruptcy filing, The emergence of new technology or government regulations, A natural or...

26 Dec 2021
0

Which OEMs Will Survive the End of the ICE Age?

Roger Rossmeisl, CPA
Automotive, Technology
Which OEMs Will Survive the End of the ICE Age?

As posted to the Munro Live YouTube Channel on 11/24/2021 (Run Time 46 min, 32 sec) Regarding the accelerating move to EVs, legendary automotive engineer Sandy Munro believes that OEMs are experiencing Scotoma, aka Paradigm Paralysis.  They cannot physiologically see the data that is unfolding around them.  When a paradigm shifts, success in the old paradigm will block your vision of the future.  When a paradigm changes, everything goes back to zero.  Your past success means nothing. GM promised 20 new EVs by 2023, yet they brought zero to the recent 2021 LA Auto Show. The EV technology disruption happening in the automotive industry is of an order of magnitude such that many OEMs simply will not survive.  Who's going to win when one company (or country) is thinking...

29 Nov 2021
0

Infrastructure Law Sunsets Employee Retention Tax Credit Early

Roger Rossmeisl, CPA
Automotive, Small Business Tax Briefs
Infrastructure Law Sunsets Employee Retention Tax Credit Early

The Employee Retention Tax Credit (ERTC) was a valuable tax credit that helped employers survive the COVID-19 pandemic. A new law has retroactively terminated it before it was scheduled to end. It now only applies through September 30, 2021 (rather than through December 31, 2021) — unless the employer is a “recovery startup business.” The Infrastructure Investment and Jobs Act of 2021 (IIJA 2021), which was signed by President Biden on November 15, 2021, doesn’t have many tax provisions but this one is important for some businesses. If you anticipated receiving the ERTC based on payroll taxes after September 30 and retained payroll taxes, you must determine how and when to repay those taxes and address any other compliance issues. The American Institute of Certified Public Accountants (AICPA)...

28 Nov 2021
0

Chinese Vehicles are Coming – Observations from an Expert

Roger Rossmeisl, CPA
Automotive, Technology
Chinese Vehicles are Coming - Observations from an Expert

As posted to the Now You Know YouTube Channel on 11/5/2021 (Run Time 29 min, 54 sec, when starting at time code 3:22) Now You Know sits down with legendary automotive engineer Sandy Munro in November 2021 to compare and contrast today's unfolding Chinese EV rollout with the Japanese vehicle invasion of the 1970s and 1980s.  On the Chinese EV business model, Sandy comments, "We're playing checkers . . . one move at a time.  They're playing chess.  If you're business plan is geared toward the book 'The Art of War', you'll win." (This is Blog Post #1130) Sandy Munro is an automotive engineer who specializes in machine tools and manufacturing. He joined the Ford Motor Company in 1978 and then started his own consulting company, Munro & Associates,...

28 Nov 2021
0

Recent FTB Clarifications on Pass-Through Entity Tax (AB-150)

Roger Rossmeisl, CPA
Automotive, Small Business Tax Briefs
Recent FTB Clarifications on Pass-Through Entity Tax (AB-150)

Recent pass-through entity (PTE) tax (AB-150) clarifications from the Franchise Tax Board (FTB) underscore that detailed planning is critical when considering this credit. For an overview of AB-150, also see our initial 8/15/21 post on this subject: "California AB-150 Provides SALT Cap Workaround". PTE Election The election to pay the tax is: made annually, is irrevocable, and can only be made on an original, timely filed return, including extensions   PTE Tax Due Date (2021 Tax Year) For the initial year the PTE tax credit concepts exists (2021) the tax is due by original due date of the 2021 tax year return, without regard to extensions.  For calendar-year taxpayers, that is March 15, 2022. Logistics of PTE Tax Payments / K-1 Recipient Credits Prior to the original due date of the tax...

17 Nov 2021
0

Factors To Consider When Choosing a Business Entity

Roger Rossmeisl, CPA
Automotive, Small Business Tax Briefs
Factors to Consider When Choosing a Business Entity

Are you planning to launch a business or thinking about changing your business entity? If so, you need to determine which entity will work best for you — a C corporation or a pass-through entity such as a sole-proprietorship, partnership, limited liability company (LLC) or S corporation. There are many factors to consider and proposed federal tax law changes being considered by Congress may affect your decision. The corporate federal income tax is currently imposed at a flat 21% rate, while the current individual federal income tax rates begin at 10% and go up to 37%. The difference in rates can be mitigated by the qualified business income (QBI) deduction that’s available to eligible pass-through entity owners that are individuals, estates and trusts. Note that non-corporate taxpayers...

26 Sep 2021
0

California Main Street Small Business Tax Credit II Begins 11/1/21

Roger Rossmeisl, CPA
Automotive, Small Business Tax Briefs
California Main Street Small Business Tax Credit II Begins 11/1/21

California Assembly Bill No. 50 (AB-50) established the California Main Street Small Business Tax Credit II, which will provide COVID-19 financial relief to qualified small business employers. Overview Beginning 11/1/21, and ending 11/30/21, the California Department of Tax and Fee Administration (CDTFA) will be accepting applications through their online reservation system for qualified small business employers to reserve $1,000 per net increase in qualified employees, not to exceed $150,000.  Tentative credit reservation amounts will generally be reduced by credit amounts reserved or received under the first Main St. Small Business Tax Credit.  The credits are reserved on a first-come, first-served basis.  Qualified small businesses will be able to offset either their income taxes or their sales and use taxes with the credit when filing their returns. Qualifications This credit...

06 Sep 2021
0

Roundabouts vs Traffic Signals

Roger Rossmeisl, CPA
Automotive
Roundabouts vs Traffic Signals

As posted to the John Stossel YouTube Channel on 6/1/21 Run time: (4 minutes, 30 seconds) Do you get frustrated when you’re the only car stopped at a traffic signal? John Stossel aims to show that roundabouts are a solution to that, and more.  In an interview with Carmel, Indiana mayor Jim Brainard, the mayor explains that roundabouts are safer, they save lives, and they cost less . . . and to prove that he's put his money where his mouth . . . he's replaced nearly every stoplight in his town with a roundabout. That means that his town now accounts for about 2% of all roundabouts in America. "Roundabouts are safer." A study in Wisconsin found that when roundabouts replaced typical intersections, deaths fell 38%. Crashes...

ROGER ROSSMEISL, CPA

Kho & Patel CPAs
160 E. Arrow Highway
San Dimas, CA 91773

(714) 325-0442
roger@khopatel.com

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