Gray, Gray & Gray Presents: Preview of the "Tax Reform Act of 2014" Webinar
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Gray, Gray & Gray Presents: Preview of the "Tax Reform Act of 2014" Webinar

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Congress has announced its intention to make the largest change in the U.S. tax code in almost 30 years. The proposed "Tax Reform Act of 2014" will have a huge impact on all taxpayers, both individual ...

Congress has announced its intention to make the largest change in the U.S. tax code in almost 30 years. The proposed "Tax Reform Act of 2014" will have a huge impact on all taxpayers, both individual and corporate.

While nobody knows what the final language of the Tax Act of 2014 will be, it is vital that you know as much about the proposed changes as possible.

While we don't expect Congress to pass this legislation this year, it will benefit you to be in-the-know. View slides from Gray, Gray & Gray's recent "Preview of the 'Tax Reform Act of 2014'" webinar to learn more about the proposed legislation.

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Gray, Gray & Gray Presents: Preview of the "Tax Reform Act of 2014" Webinar Gray, Gray & Gray Presents: Preview of the "Tax Reform Act of 2014" Webinar Presentation Transcript

  • Presented By: Michael D. Koppel, CPA, MBA, PFS, CITP
  • Today’s Presenter Michael D. Koppel, CPA, MBA, PFS, CITP mkoppel@gggcpas.com mike@thekoppels.com P: (781)407-0300 | D: (781)407-3254 C: (617)775-2129
  • Today’s Goal  Not to be political  Not favor any specific position  Make people aware so they can make informed decisions during the upcoming discussion  Make their desires known
  • Tax Reform Act of 2014 UNLESS RELEVANT
  • Tax Reform Act of 2014 UNLESS YOU ASK
  • Tax Reform Act of 2014 SOME HISTORY TAX REFORM ACT OF 1986 RULE OF UNINTENDED CONSEQUENCES!
  • Tax Reform Act of 2014 CAMP’S GOAL: Simplicity and Fairness
  • Tax Reform Act of 2014 Only 2 Individual Rates SINGLE MARRIED JOINT PRESENT LAW PROPOSED <$9,200 <$18,400 10% 10% $9,201-$37,400 $18,401 15% 10% $37,401-$90,600 $74,801-$151,100 25% 25% $90,601-$189,000 $151,000-$230,000 28% 25% $189,001-$410,950 $230,101-$410,950 33% 25% <$412,650 >$464,200 39.8% 25%
  • Tax Reform Act of 2014 10% Surtax MAGI Over $400,000 / $450,000 Marriage Penalty!
  • Tax Reform Act of 2014 But wait, there is more!
  • Tax Reform Act of 2014  Eliminates deduction state & local taxes  Increase in standard deduction with higher phase-out  Reduce cap for mortgage deduction to $500,000 (phased-in)  New exemption of dividend and capital gain  Investment interest expense reduced by tax- exempt interest  Increased restriction & phase-out of residence gain exclusion More:
  • Tax Reform Act of 2014  Limitation on charitable donation (excess of 2% of AGI)  Percentage deduction reduced  Repeal of most individual credits  4 higher education provisions rolled in American Opportunity Credit  Expands child care credit  No personal exemptions  NII surtax remains Even More:
  • Tax Reform Act of 2014  Reduces by half available 401(k)  Other half can be made a Roth type account  Employers with more than 100 employees must offer Roth accounts  Remove income limits on Roth IRAs  No new contributions to regular or nondeductible IRAs  Repeal exceptions to 10% early withdrawal penalty Retirement
  • Tax Reform Act of 2014 AMT Repealed for All Provisions for unused credits WHY?
  • Tax Reform Act of 2014  Repeal of MACRs  Usually longer lives (ADS)  Straight line  But can elect additional depreciation for inflation  No bonus depreciation  Repeal special rules for pollution control facilities  90% limitation on NOLs  Special 5 year life for R&D expenses  Advertising expense 50% deduction remainder 10 year life  Does not apply to first million but phase-out  §179 $250,000 phase-out starting at $800,000 Business Provisions
  • Tax Reform Act of 2014  Goodwill and most other intangibles now 20 year amortization  End of LIFO/lower of cost or market  Like-kind exchanges gone or minimized  New limitations on entertainment etc.  Repeal of “small business” tax exemption  New rules for gain on contribution of assets for capital  New rules or repeal of most credits  Reduction of installment sales interest to $150,000  Repeal of production deduction (sort of) Business Provisions
  • Tax Reform Act of 2014 Limitation on the Cash Method  All entities with revenue of $10 million or more  Except  Farms  Sole proprietors
  • Tax Reform Act of 2014 Self-Employment Tax  History - bifurcation – sense of the senate  70% subject to S/E tax ($15.3 billion over 10 years)  Repeal of exception for certain students ($13 billion over 10 years)
  • Tax Reform Act of 2014 Carried Interest
  • Tax Reform Act of 2014 Big Bank Tax
  • Tax Reform Act of 2014  New limitation on completed-contract method  New rules on derivatives  Sale of securities must use LIFO  Income from private activity bonds taxable  Simplification of certain S Corp rules  Repeal partnership guaranteed payment rules  New REIT rules  New deferred compensation rules  New safe harbor for worker classification Other “Stuff”:
  • Tax Reform Act of 2014  New restrictions and changes to foreign income  New UBTI rules for not for profits  Changes to cruise ship, and employees taxation  Taxation of excess compensation of officers of tax-exempt organizations  Excise tax on certain investment income of private colleges  Taxations of “professional football leagues”  Taxpayer Bill of Rights Other “Stuff”:
  • Tax Reform Act of 2014 Estate & Gift
  • Questions? Michael D. Koppel, CPA, MBA, PFS, CITP mkoppel@gggcpas.com mike@thekoppels.com P: (781)407-0300 | D: (781)407-3254 C: (617)775-2129
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  • Disclaimer The content of this webinar is intended for educational purposes only. This webinar provides a brief summary based on our understanding and interpretation of current law. All tax references are to federal tax law only, unless otherwise stated. The information contained in this webinar is general in nature and is based on authorities that are subject to change. It is not, and should not be construed as accounting, legal or tax advice or opinion provided by Gray, Gray & Gray, LLP. The material presented may not be applicable to, or suitable for, specific circumstances or needs, and may require consideration of non-tax factors and tax factors not described herein. Contact Gray, Gray & Gray or another tax professional prior to taking any action based upon this information. Changes in tax laws or other factors could affect, on a prospective or retroactive basis the information contained herein; Gray, Gray & Gray assumes no obligation to inform the reader/webinar attendee of any such changes. The material presented in this webinar is not intended to, and cannot be used to, avoid IRS penalties. This material supports the marketing and promotion of accounting services. Seek advice based on your particular circumstances from independent tax, legal accounting, insurance, investment and financial advisors. Michael D. Koppel, CPA, PFS is a Certified Public Accountant in Massachusetts and serves as Tax Advisor at Gray, Gray & Gray, LLP.