This article discusses the general tax principles relating to the settlement of relationship property in New Zealand, including the potential effect of the new ‘bright line’ test for residential property introduced on 1 October 2015.
Using Like-Kind Exchanges after the TCJACBIZ, Inc.
As changes were made to reduce taxes in some areas, such as the new corporate tax rate, others were made to offset the total cost of the law. Like-kind exchanges under Section 1031 fell into the latter category. If you used like-kind exchanges in the past, it will be important to note how the rules have changed since the TCJA went into law.
Commercial Real Estate Hot Topics - January 2018CBIZ, Inc.
CBIZ’s Real Estate practice is uniquely positioned to help you
minimize risk and capitalize on market opportunities.
We work with owners, managers, operators and investors, as well as commercial real estate developers and partnerships in all of the major CRE sectors: retail, office, hotel, multi-family, shopping centers and real estate investment trusts.
August 2016 - New Proposed Regulations Restricting Valuation Discounts for Fa...Julia (Julie) Weaver, J.D.
The proposed regulations from the Treasury Department would greatly restrict the availability of valuation discounts for family-controlled entities. This could significantly increase some families' federal estate tax exposure by limiting discounts that allow more wealth to pass to heirs outside of estate taxes. The proposed regulations would disregard many restrictions that currently result in valuation discounts and contain broad family attribution rules. Key considerations for families include whether federal estate taxes are a current risk and whether planning strategies should be implemented in light of the potential changes to current estate planning laws if the regulations are finalized.
- The document proposes instituting a mandatory insurance surcharge on property and casualty insurance policies in states like New York and New Jersey to generate funds for infrastructure resiliency initiatives.
- Using a proven credit structure, the funds could be accessed through capital markets to efficiently and quickly maximize proceeds for projects to mitigate potential damage from future natural disasters.
- Over half of property and casualty insurance premiums in the target states come from automobile and homeowners' policies, providing a substantial untapped source of funding that could reduce future economic costs from climate events.
Webinar: Sales Tax Issues to Keep an Eye Out For!Withum
This document discusses sales tax issues and provides an overview of nexus rules and the impact of the Wayfair decision. It summarizes key sales tax concepts such as nexus, economic nexus, marketplace facilitators, and taxability of software. The document advises reviewing a company's existing and post-Wayfair nexus footprint, assessing taxability of products/services, considering technology needs, and preparing to register and comply with new state sales tax requirements.
This report analyzes whether an arrangement between Rosy and James for Rosy to pay James $40,000 annually for accounting work is a "tax avoidance arrangement" under New Zealand tax law. The report examines two tests: 1) whether the arrangement has a tax avoidance purpose or effect, and 2) whether the arrangement is consistent with Parliament's purpose based on a commercially and economically realistic interpretation. While the $40,000 fee could be viewed as remuneration for services, factors like their close family relationship and the unreasonably high fee suggest the arrangement was primarily intended to reduce Rosy's tax liability, in violation of general anti-avoidance provisions.
Related Party Transactions- A Closer PerspectiveChhavi Sharma
The shared slide provides an insight into the auditing & accounting aspects of the related party transactions. A brief description of certain relaxation norms under Companies Act 2013, SEBI's corporate governance norms and treatment under Income Tax Act, 1961 has been envisaged herein.
Using Like-Kind Exchanges after the TCJACBIZ, Inc.
As changes were made to reduce taxes in some areas, such as the new corporate tax rate, others were made to offset the total cost of the law. Like-kind exchanges under Section 1031 fell into the latter category. If you used like-kind exchanges in the past, it will be important to note how the rules have changed since the TCJA went into law.
Commercial Real Estate Hot Topics - January 2018CBIZ, Inc.
CBIZ’s Real Estate practice is uniquely positioned to help you
minimize risk and capitalize on market opportunities.
We work with owners, managers, operators and investors, as well as commercial real estate developers and partnerships in all of the major CRE sectors: retail, office, hotel, multi-family, shopping centers and real estate investment trusts.
August 2016 - New Proposed Regulations Restricting Valuation Discounts for Fa...Julia (Julie) Weaver, J.D.
The proposed regulations from the Treasury Department would greatly restrict the availability of valuation discounts for family-controlled entities. This could significantly increase some families' federal estate tax exposure by limiting discounts that allow more wealth to pass to heirs outside of estate taxes. The proposed regulations would disregard many restrictions that currently result in valuation discounts and contain broad family attribution rules. Key considerations for families include whether federal estate taxes are a current risk and whether planning strategies should be implemented in light of the potential changes to current estate planning laws if the regulations are finalized.
- The document proposes instituting a mandatory insurance surcharge on property and casualty insurance policies in states like New York and New Jersey to generate funds for infrastructure resiliency initiatives.
- Using a proven credit structure, the funds could be accessed through capital markets to efficiently and quickly maximize proceeds for projects to mitigate potential damage from future natural disasters.
- Over half of property and casualty insurance premiums in the target states come from automobile and homeowners' policies, providing a substantial untapped source of funding that could reduce future economic costs from climate events.
Webinar: Sales Tax Issues to Keep an Eye Out For!Withum
This document discusses sales tax issues and provides an overview of nexus rules and the impact of the Wayfair decision. It summarizes key sales tax concepts such as nexus, economic nexus, marketplace facilitators, and taxability of software. The document advises reviewing a company's existing and post-Wayfair nexus footprint, assessing taxability of products/services, considering technology needs, and preparing to register and comply with new state sales tax requirements.
This report analyzes whether an arrangement between Rosy and James for Rosy to pay James $40,000 annually for accounting work is a "tax avoidance arrangement" under New Zealand tax law. The report examines two tests: 1) whether the arrangement has a tax avoidance purpose or effect, and 2) whether the arrangement is consistent with Parliament's purpose based on a commercially and economically realistic interpretation. While the $40,000 fee could be viewed as remuneration for services, factors like their close family relationship and the unreasonably high fee suggest the arrangement was primarily intended to reduce Rosy's tax liability, in violation of general anti-avoidance provisions.
Related Party Transactions- A Closer PerspectiveChhavi Sharma
The shared slide provides an insight into the auditing & accounting aspects of the related party transactions. A brief description of certain relaxation norms under Companies Act 2013, SEBI's corporate governance norms and treatment under Income Tax Act, 1961 has been envisaged herein.
2011 aia presentation the good bad and the ugly of strategic relationships (2)bhealey
The document discusses the benefits and risks of forming strategic alliances. It notes that strategic alliances can provide cost sharing, risk sharing, and allow companies to enhance their strengths and compensate for weaknesses. However, improperly formed alliances can create unwanted legal exposure, such as unexpected liability to third parties if a joint venture is determined to be a partnership under law. A partnership comes with obligations to other partners, questions around ownership of shared property, and potential regulatory violations. The document provides examples of cases where alliances resulted in large damage awards or disputes due to lack of clarity around the legal relationship.
This document discusses the different types of relationships that can exist between a property manager and owner, including employer-employee, trust, and principal-agent relationships. It describes the key elements of a management contract, such as the parties involved, period covered, responsibilities of the manager and owner, fees, and termination. The document also outlines takeover procedures when a new manager assumes responsibility for a property and the importance of continuing communication between manager and owner through monthly reports and personal contact.
The MTC’s Restatement on PL 86-272 Expands State’s Ability to Impose Income T...Withum
P.L. 86-272 says that a state cannot impose an income tax if a company's only connection to that state is soliciting sales of tangible personal property. Historically, certain activities have been protected under P.L. 86-272, such as soliciting orders, providing samples, and maintaining property for salespeople. However, other activities can cause a company to lose P.L. 86-272 protection, like fulfilling orders, performing repairs, owning inventory in the state, or having employees perform non-sales activities. As the economy has evolved, it has become more difficult for companies to limit their activities to just solicitation and remain under P.L. 86-272's protections.
2021 Year End Tax Planning for Law Firms and AttorneysWithum
This document provides an overview and summary of a webinar on 2021 year-end tax planning for law firms and attorneys. It discusses various federal tax law updates and proposals, as well as strategies for year-end tax planning including deferring income, accelerating expenses, maximizing deductions, and utilizing available exemptions and exclusions for estate and gift tax purposes before potential changes in 2022. The webinar covers individual, business, retirement, and pass-through entity tax considerations and implications.
The IRS is pursing all manner of estate planning transactions involving family-controlled entities ("FCEs") and now has gone straight to the heart of the matter - valuation.
The Intersection of Bankruptcy and... Tax Law (Series: Bankruptcy Intersectio...Financial Poise
The issues created by the intersection of bankruptcy law and tax law are complex and marked by the tension between the fundamental goal of the federal bankruptcy laws is to give debtors a financial "fresh start" from burdensome debts and the applicable federal income tax laws. As a result, certain tax liabilities are not dischargeable in bankruptcy. Moreover, a debtor generally continues to be subject to applicable federal income tax laws and must timely file federal income tax returns and pay federal income tax.
To listen to this webinar on-demand, go to: https://www.financialpoise.com/financial-poise-webinars/intersection-of-bankruptcy-and-tax-law-2020/
Doing business in the united states presentation 101028 (1)Denis Dovgopoliy
The document provides an overview of key considerations for doing business in the United States, including:
1) Regulatory environment covers areas like antitrust, consumer protection, intellectual property, accounting standards.
2) Choice of entity includes LLC, LP, C Corp, S Corp which provide liability protection.
3) Transfer pricing is important for related party transactions to reflect arm's length prices and avoid penalties.
The document discusses India's General Anti-Avoidance Rules (GAAR) which come into effect on April 1, 2017. GAAR allows officials to deny tax benefits to transactions that do not have commercial substance or are aimed solely at reducing taxes. It targets offshore structures used to avoid taxes in India. As of April 1st, arrangements without commercial purpose can be declared "impermissible" and taxed accordingly, with penalties such as disregarding steps to avoid taxes or treating connected parties as one entity. The government aims to discipline multinational companies with rigorous tax planning with GAAR while not halting legal tax planning. Documentation and tax governance are crucial to demonstrate business purpose and avoid GAAR penalties.
Year-End Tax Planning and Financial Planning Ideas - Dec. 2011RobertWBaird
This document provides year-end tax and financial planning ideas for private wealth management clients. It discusses reviewing capital gains and losses to realize losses to offset gains, considering realizing gains to use up losses, and avoiding wash sales. It also recommends ensuring adequate tax withholdings and payments to avoid penalties, accelerating or deferring income and deductions as needed, and completing charitable donations by year-end to take the deduction. The tax rates for 2012 are expected to remain the same as 2011 but could change significantly after that.
This document discusses establishing Florida residency and escaping taxes in northeastern states. It provides an overview of residency concepts like domicile and statutory residency. It compares Florida's definition, which focuses on filing a declaration of domicile, to other states like New York, New Jersey, and Pennsylvania. It also outlines factors considered for residency in Georgia and compares requirements in other states throughout the U.S. The document aims to help individuals determine if and when they should change their residency status.
The IRS is making several changes to their tax lien process to help struggling taxpayers, including increasing the dollar threshold for when liens are issued which should result in fewer liens. They are also expanding installment agreement programs for small businesses and the streamlined offer in compromise program. Critics say the changes do not go far enough, while others see it as a step in the right direction to provide more flexibility for taxpayers getting back on track with their tax obligations.
The American Taxpayer Relief Act of 2012 made several changes to estate, gift, and generation-skipping transfer tax laws. It made the $5,250,000 estate and gift tax exemption permanent and increased the tax rate for transfers over the exemption amount from 35% to 40%. It also extended provisions like portability of exemption amounts between spouses and the deduction for state death taxes. The Act increased some annual gift and retirement account transfer limits and extended education savings incentives.
Investment Tax Landscape Countdown To 2013dvanderjagt
The document discusses the tax landscape between now and 2013 as Congress wrestles with budget deficit issues. It may represent a stay of execution for higher taxes rather than a pardon. Several types of investors should pay attention to planning, including those with substantial capital gains, those reliant on dividends/bonds for income, and those investing in small businesses. Capital gains and dividend tax rates may increase after 2012, and tax-free municipal bonds may become relatively more attractive for high-income investors. The 100% capital gains exclusion was extended for qualifying small business stock issued before January 2012.
The document summarizes key provisions of the Bush-era tax cuts that are set to expire at the end of 2012 unless extended by Congress. It discusses lowering of individual income tax rates, capital gains rates, the estate tax exemption, and the alternative minimum tax. It also provides an update on efforts by Mexico to expand its tax information exchange agreement with the US.
PrietoDion Consulting Partners LLC _Comparing State Tax Amnesty to Voluntary ...Sylvia F. Dion, MPA, CPA
This document summarizes and compares two programs for resolving state tax delinquencies - state tax amnesty programs and state voluntary disclosure programs. State tax amnesty programs offer benefits like penalty and interest abatement in exchange for filing delinquent returns during a limited-time amnesty period. However, amnesty programs have drawbacks like requiring taxpayers to file returns for many prior years and potentially waive appeal rights. State voluntary disclosure programs allow taxpayers to negotiate terms before disclosure and typically offer a limited look-back period and penalty waiver. While voluntary disclosure brings taxpayers onto state tax rolls, it requires addressing all owed tax types and subjects taxpayers to future audits. The document analyzes benefits and issues to consider with both approaches.
This chapter introduces federal taxation in the United States. It discusses the four major types of federal taxes: income taxes, employment taxes, estate and gift taxes, and excise and customs taxes. It also provides an overview of tax revenue statistics, the differences between tax avoidance and tax evasion, the history of the federal income tax, the tax legislative process, and the objectives of tax law.
Although you can’t avoid taxes, you can take steps to minimize them. This requires proactive tax planning — estimating your tax liability, looking for ways to reduce it and taking timely action.
The Real Estate Investment News is the Monthly Publication of Mid-America Association of Real Estate Investors. This month at MAREI: Tax Planning, Asset Protection, Retirement Fund Growth and Record Keeping with Quickbooks.
La prueba PISA mide las habilidades de los estudiantes de 15 años en lectura, matemáticas y ciencias. Se aplica cada 3 años en más de 70 países y evalúa si los estudiantes pueden aplicar sus conocimientos y habilidades a situaciones de la vida real. Los resultados de la prueba ayudan a los países a mejorar sus sistemas educativos y políticas.
2011 aia presentation the good bad and the ugly of strategic relationships (2)bhealey
The document discusses the benefits and risks of forming strategic alliances. It notes that strategic alliances can provide cost sharing, risk sharing, and allow companies to enhance their strengths and compensate for weaknesses. However, improperly formed alliances can create unwanted legal exposure, such as unexpected liability to third parties if a joint venture is determined to be a partnership under law. A partnership comes with obligations to other partners, questions around ownership of shared property, and potential regulatory violations. The document provides examples of cases where alliances resulted in large damage awards or disputes due to lack of clarity around the legal relationship.
This document discusses the different types of relationships that can exist between a property manager and owner, including employer-employee, trust, and principal-agent relationships. It describes the key elements of a management contract, such as the parties involved, period covered, responsibilities of the manager and owner, fees, and termination. The document also outlines takeover procedures when a new manager assumes responsibility for a property and the importance of continuing communication between manager and owner through monthly reports and personal contact.
The MTC’s Restatement on PL 86-272 Expands State’s Ability to Impose Income T...Withum
P.L. 86-272 says that a state cannot impose an income tax if a company's only connection to that state is soliciting sales of tangible personal property. Historically, certain activities have been protected under P.L. 86-272, such as soliciting orders, providing samples, and maintaining property for salespeople. However, other activities can cause a company to lose P.L. 86-272 protection, like fulfilling orders, performing repairs, owning inventory in the state, or having employees perform non-sales activities. As the economy has evolved, it has become more difficult for companies to limit their activities to just solicitation and remain under P.L. 86-272's protections.
2021 Year End Tax Planning for Law Firms and AttorneysWithum
This document provides an overview and summary of a webinar on 2021 year-end tax planning for law firms and attorneys. It discusses various federal tax law updates and proposals, as well as strategies for year-end tax planning including deferring income, accelerating expenses, maximizing deductions, and utilizing available exemptions and exclusions for estate and gift tax purposes before potential changes in 2022. The webinar covers individual, business, retirement, and pass-through entity tax considerations and implications.
The IRS is pursing all manner of estate planning transactions involving family-controlled entities ("FCEs") and now has gone straight to the heart of the matter - valuation.
The Intersection of Bankruptcy and... Tax Law (Series: Bankruptcy Intersectio...Financial Poise
The issues created by the intersection of bankruptcy law and tax law are complex and marked by the tension between the fundamental goal of the federal bankruptcy laws is to give debtors a financial "fresh start" from burdensome debts and the applicable federal income tax laws. As a result, certain tax liabilities are not dischargeable in bankruptcy. Moreover, a debtor generally continues to be subject to applicable federal income tax laws and must timely file federal income tax returns and pay federal income tax.
To listen to this webinar on-demand, go to: https://www.financialpoise.com/financial-poise-webinars/intersection-of-bankruptcy-and-tax-law-2020/
Doing business in the united states presentation 101028 (1)Denis Dovgopoliy
The document provides an overview of key considerations for doing business in the United States, including:
1) Regulatory environment covers areas like antitrust, consumer protection, intellectual property, accounting standards.
2) Choice of entity includes LLC, LP, C Corp, S Corp which provide liability protection.
3) Transfer pricing is important for related party transactions to reflect arm's length prices and avoid penalties.
The document discusses India's General Anti-Avoidance Rules (GAAR) which come into effect on April 1, 2017. GAAR allows officials to deny tax benefits to transactions that do not have commercial substance or are aimed solely at reducing taxes. It targets offshore structures used to avoid taxes in India. As of April 1st, arrangements without commercial purpose can be declared "impermissible" and taxed accordingly, with penalties such as disregarding steps to avoid taxes or treating connected parties as one entity. The government aims to discipline multinational companies with rigorous tax planning with GAAR while not halting legal tax planning. Documentation and tax governance are crucial to demonstrate business purpose and avoid GAAR penalties.
Year-End Tax Planning and Financial Planning Ideas - Dec. 2011RobertWBaird
This document provides year-end tax and financial planning ideas for private wealth management clients. It discusses reviewing capital gains and losses to realize losses to offset gains, considering realizing gains to use up losses, and avoiding wash sales. It also recommends ensuring adequate tax withholdings and payments to avoid penalties, accelerating or deferring income and deductions as needed, and completing charitable donations by year-end to take the deduction. The tax rates for 2012 are expected to remain the same as 2011 but could change significantly after that.
This document discusses establishing Florida residency and escaping taxes in northeastern states. It provides an overview of residency concepts like domicile and statutory residency. It compares Florida's definition, which focuses on filing a declaration of domicile, to other states like New York, New Jersey, and Pennsylvania. It also outlines factors considered for residency in Georgia and compares requirements in other states throughout the U.S. The document aims to help individuals determine if and when they should change their residency status.
The IRS is making several changes to their tax lien process to help struggling taxpayers, including increasing the dollar threshold for when liens are issued which should result in fewer liens. They are also expanding installment agreement programs for small businesses and the streamlined offer in compromise program. Critics say the changes do not go far enough, while others see it as a step in the right direction to provide more flexibility for taxpayers getting back on track with their tax obligations.
The American Taxpayer Relief Act of 2012 made several changes to estate, gift, and generation-skipping transfer tax laws. It made the $5,250,000 estate and gift tax exemption permanent and increased the tax rate for transfers over the exemption amount from 35% to 40%. It also extended provisions like portability of exemption amounts between spouses and the deduction for state death taxes. The Act increased some annual gift and retirement account transfer limits and extended education savings incentives.
Investment Tax Landscape Countdown To 2013dvanderjagt
The document discusses the tax landscape between now and 2013 as Congress wrestles with budget deficit issues. It may represent a stay of execution for higher taxes rather than a pardon. Several types of investors should pay attention to planning, including those with substantial capital gains, those reliant on dividends/bonds for income, and those investing in small businesses. Capital gains and dividend tax rates may increase after 2012, and tax-free municipal bonds may become relatively more attractive for high-income investors. The 100% capital gains exclusion was extended for qualifying small business stock issued before January 2012.
The document summarizes key provisions of the Bush-era tax cuts that are set to expire at the end of 2012 unless extended by Congress. It discusses lowering of individual income tax rates, capital gains rates, the estate tax exemption, and the alternative minimum tax. It also provides an update on efforts by Mexico to expand its tax information exchange agreement with the US.
PrietoDion Consulting Partners LLC _Comparing State Tax Amnesty to Voluntary ...Sylvia F. Dion, MPA, CPA
This document summarizes and compares two programs for resolving state tax delinquencies - state tax amnesty programs and state voluntary disclosure programs. State tax amnesty programs offer benefits like penalty and interest abatement in exchange for filing delinquent returns during a limited-time amnesty period. However, amnesty programs have drawbacks like requiring taxpayers to file returns for many prior years and potentially waive appeal rights. State voluntary disclosure programs allow taxpayers to negotiate terms before disclosure and typically offer a limited look-back period and penalty waiver. While voluntary disclosure brings taxpayers onto state tax rolls, it requires addressing all owed tax types and subjects taxpayers to future audits. The document analyzes benefits and issues to consider with both approaches.
This chapter introduces federal taxation in the United States. It discusses the four major types of federal taxes: income taxes, employment taxes, estate and gift taxes, and excise and customs taxes. It also provides an overview of tax revenue statistics, the differences between tax avoidance and tax evasion, the history of the federal income tax, the tax legislative process, and the objectives of tax law.
Although you can’t avoid taxes, you can take steps to minimize them. This requires proactive tax planning — estimating your tax liability, looking for ways to reduce it and taking timely action.
The Real Estate Investment News is the Monthly Publication of Mid-America Association of Real Estate Investors. This month at MAREI: Tax Planning, Asset Protection, Retirement Fund Growth and Record Keeping with Quickbooks.
La prueba PISA mide las habilidades de los estudiantes de 15 años en lectura, matemáticas y ciencias. Se aplica cada 3 años en más de 70 países y evalúa si los estudiantes pueden aplicar sus conocimientos y habilidades a situaciones de la vida real. Los resultados de la prueba ayudan a los países a mejorar sus sistemas educativos y políticas.
Sean Watkins provides a CV that includes personal details, education history, skills, and work experience. He has 10 years of experience programming in Java and 5 years in Android development. Currently, he is a lead Android developer creating mobile applications for network operators to monitor network performance and customer experience. Previously, he held roles in biomedical science, logistics management, and software development and consulting.
1) A group of students and faculty from Charleston Southern University traveled to Brazil as part of an Enactus project to develop a business plan that would fund nonprofit ministry in villages.
2) Over the course of a vacation bible school, 15 children accepted Christ and 18 more were baptized. The students developed strong relationships with the children and their families despite language barriers.
3) Though the main goal was to develop a business plan, the students found that their primary impact was through meaningful relationships with the Brazilian children, who demonstrated strong faith despite their lack of material possessions. The experience had a profound effect on the spiritual lives of the students.
The document summarizes concerns raised by an Auckland accountant about New Zealand's proposed "Bright-Line Test for Residential Land" legislation. Specifically, it notes that the bill uses acquisition and sale dates that taxpayers may not be familiar with, potentially resulting in unexpected tax bills. It also discusses increased compliance costs, unfair penalties for one-time sellers, and complexities around family arrangements and determining repairs vs improvements. The accountant hopes the government will refine the bill to make it fairer and more workable.
For tax years 2018 through 2025, you may be able to deduct
up to 20% of qualified business income (QBI) from each of
your qualified trades or businesses, including those operated
through a sole proprietorship, or a pass-through entity,
such as a partnership, LLC, or S corporation.
Cost segregation studies allow business owners to maximize tax depreciation deductions by analyzing building components and reclassifying costs that were initially categorized as commercial real estate, which has a 39-year recovery period, into components with shorter recovery periods of 5, 7, or 15 years. This results in larger depreciation deductions in the early years, providing a net present value of tax savings ranging from $100,000 to $181,000 on $1 million of costs reclassified. Retroactive cost segregation studies can also be performed to deduct prior unclaimed depreciation. The economic benefits come from both the time value of money and, for properties subject to capital gains rates, the lower capital gains tax rate on appreciation
Puerto Rico: How the proposed Value Added Tax will impact the Construction In...Alex Baulf
Act 72 which amends the Internal Revenue Code for a New Puerto Rico introduces a value added tax system in Puerto Rico that will replace the Sales and Use tax system (“SUT”)
effective April 1, 2016, for state tax purposes.
The SUT will continue to be in place for municipal tax purposes after April 1, 2016.
This guidance from Kevane Grant Thornton LLP specifically relates to the construction industry.
CGT rollover relief on marriage breakdown | Family Business Accountants | Wes...Craig Seddon
The effect of the roll-over relief is that the normal CGT rules don't apply in relation to the disposal, so there are no CGT consequences to the transferor.
The transferee acquires the asset with the same CGT nature which it had in the hands of the transferor.
https://www.westcourt.com.au
S&A Knowledge Series - Sec 50C implications under income tax actDhruv Seth
Please find attached a writeup on Sec 50C of the Income Tax Act, 1961 with the latest amendments of the Finance Act 2020.
Sec 50C deals with the deemed income under the Income Tax Act in case of the difference between actual sale value and the defined circle rate value. This section applies only to capital gains and not to business assets such as closing stock.
The Taxperts Group can guide you through tax audits and appeals and help minimize your tax bills for years to come. Our accountants have legal and accounting expertise to help people with their taxes in Toronto, Ontario.
This document summarizes the key tax implications landlords need to be aware of, including income tax, capital gains tax, and inheritance tax. It outlines the rental income landlords must declare and expenses they can deduct. Profit from rental properties is taxed as income. When selling a rental property, capital gains tax applies to any increase in property value over time. Landlords must also consider how rental properties factor into inheritance tax. Proper record keeping of rental income, expenses, purchases and improvements is important for tax reporting.
Landlords are facing changes to tax legislation that will reduce their rental income. Incorporating rental properties into a limited company allows landlords to avoid capital gains tax, stamp duty land tax, and inheritance tax. It also provides 100% tax relief on mortgage interest and corporation tax of only 17-20% on rental income compared to the individual tax rate of 20-45%. Setting up a specialist trust can further protect the shares of the company from inheritance tax.
Why prepare now? 5 things that smart businesses are doing TODAY to prepare fo...Grant Thornton LLP
Tax reform is top of mind for many of today’s businesses as they struggle to understand what it might mean to them, and what they should be doing to prepare. While it may be easy to be paralyzed by the uncertainty of the legislative process, a “wait-and-see” approach is a mistake. The prospect of tax reform creates tremendous new tax planning opportunities, and many of these are effective only if done before tax reform is enacted. No company should be making long-term business decisions without understanding how tax reform could affect the economic impact. Learn the five steps your business can take now to prepare for tax reform.
The document discusses the Deferred Sales Trust (DST) as a strategy for property owners to defer capital gains taxes when selling appreciated assets like real estate. The DST allows the seller to transfer ownership of the property to a trust in exchange for a promissory note, deferred the capital gains tax until payments on the note are received. The trust then sells the property and uses the proceeds to invest and make scheduled payments to the seller over time based on terms in the promissory note. This allows the seller to defer capital gains tax for years while maintaining access to the value of the property through the installment payments. Key benefits of a DST include tax deferral, estate tax benefits, maintaining family wealth, and providing retirement income
- The document discusses the Deferred Sales Trust (DST) as a way for property owners to defer capital gains taxes when selling appreciated assets like real estate or businesses.
- With a DST, the owner sells the property to a trust. The trust then pays the owner over time based on a payment contract rather than immediately. This allows the owner to defer capital gains taxes until payments are received.
- Benefits of a DST include tax deferral, potential estate tax benefits, maintaining family wealth by passing the trust principal to heirs, and providing estate liquidity by converting an illiquid asset into monthly payments.
- The document discusses the Deferred Sales Trust (DST) as a way for property owners to defer capital gains taxes when selling appreciated assets like real estate or businesses.
- With a DST, the owner sells the property to a trust. The trust then pays the owner over time based on a payment contract rather than immediately. This allows the owner to defer capital gains taxes until payments are received.
- Benefits of a DST include tax deferral, potential estate tax benefits, maintaining family wealth by passing the trust principal to heirs, and providing estate liquidity by converting an illiquid asset into monthly payments.
The document discusses the Deferred Sales Trust (DST) as a strategy for property owners to defer capital gains taxes when selling appreciated assets like real estate. The DST allows the seller to transfer ownership of the property to a trust in exchange for a promissory note, paid out over time. This defers capital gains taxes until payments are received. The trust then sells the property and uses the funds to make installment payments to the original owner. This converts their illiquid asset into a stream of income while legally deferring tax liability. Setting up a DST requires working with an approved trustee to establish payment terms tailored to the seller's needs and properly invest trust funds to ensure note obligations are met.
- The document discusses the Deferred Sales Trust (DST) as a way for property owners to defer capital gains taxes when selling appreciated assets like real estate or businesses.
- With a DST, the owner sells the property to a trust. The trust then pays the owner over time based on a payment contract rather than immediately. This allows the owner to defer capital gains taxes until payments are received.
- Benefits of a DST include tax deferral, potential estate tax benefits, maintaining family wealth by passing the trust principal to heirs, and providing estate liquidity by converting an illiquid asset into monthly payments.
The document discusses the Deferred Sales Trust (DST) as a strategy for property owners to defer capital gains taxes when selling appreciated assets like real estate. The DST allows the seller to transfer ownership of the property to a trust in exchange for a promissory note, deferred the capital gains tax until payments on the note are received. The trust then sells the property and uses the proceeds to invest and make scheduled payments to the seller over time based on terms in the promissory note. This allows the seller to defer capital gains tax for years while maintaining access to the value of the property through the installment payments. Key benefits of a DST include tax deferral, estate tax benefits, maintaining family wealth, and providing retirement income
Topic: Tax Law ; Type: Letter Subject: Accounting and Finance; Academic Level: Undergraduate; Style: Turabian Language: English (U.S); Number of sources: 3
Impact of Modi Budget 2014 on Specific Sectors...
Dear Friends,
It gives us a pleasure to present the summary of India Budget Synthesis 2014.
While you may already have the snapshot, here is a document which will not only give you crisp highlights, but would also decode the impact of Budget 2014 on You, Your Company and Your Sector.
Hope you find this analysis useful in taking clearer business decisions and align your company's strategy with the overall economic climate in the balance part of financial year 2014-15.
Would love to hear your feedback on the usefulness of the same."
Regards,
Vishal Thakkar | Group Head - Corporate Relations | Synthesis Group
Hand Phone: 91 9320007891 | Boardline: 91 22 24093737 | Fax: 91 22 24093737
Similar to The bright line test and other tax considerations in relationship property settlements (20)
Independent Study - College of Wooster Research (2023-2024) FDI, Culture, Glo...AntoniaOwensDetwiler
"Does Foreign Direct Investment Negatively Affect Preservation of Culture in the Global South? Case Studies in Thailand and Cambodia."
Do elements of globalization, such as Foreign Direct Investment (FDI), negatively affect the ability of countries in the Global South to preserve their culture? This research aims to answer this question by employing a cross-sectional comparative case study analysis utilizing methods of difference. Thailand and Cambodia are compared as they are in the same region and have a similar culture. The metric of difference between Thailand and Cambodia is their ability to preserve their culture. This ability is operationalized by their respective attitudes towards FDI; Thailand imposes stringent regulations and limitations on FDI while Cambodia does not hesitate to accept most FDI and imposes fewer limitations. The evidence from this study suggests that FDI from globally influential countries with high gross domestic products (GDPs) (e.g. China, U.S.) challenges the ability of countries with lower GDPs (e.g. Cambodia) to protect their culture. Furthermore, the ability, or lack thereof, of the receiving countries to protect their culture is amplified by the existence and implementation of restrictive FDI policies imposed by their governments.
My study abroad in Bali, Indonesia, inspired this research topic as I noticed how globalization is changing the culture of its people. I learned their language and way of life which helped me understand the beauty and importance of cultural preservation. I believe we could all benefit from learning new perspectives as they could help us ideate solutions to contemporary issues and empathize with others.
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2. Elemental Economics - Mineral demand.pdfNeal Brewster
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Suzanne Spiteri’s recent report on improving the quality and accessibility of job postings to reduce employment barriers for neurodivergent people.
Decoding job postings: Improving accessibility for neurodivergent job seekers
Improving the quality and accessibility of job postings is one way to reduce employment barriers for neurodivergent people.
In a tight labour market, job-seekers gain bargaining power and leverage it into greater job quality—at least, that’s the conventional wisdom.
Michael, LMIC Economist, presented findings that reveal a weakened relationship between labour market tightness and job quality indicators following the pandemic. Labour market tightness coincided with growth in real wages for only a portion of workers: those in low-wage jobs requiring little education. Several factors—including labour market composition, worker and employer behaviour, and labour market practices—have contributed to the absence of worker benefits. These will be investigated further in future work.
1. Elemental Economics - Introduction to mining.pdfNeal Brewster
After this first you should: Understand the nature of mining; have an awareness of the industry’s boundaries, corporate structure and size; appreciation the complex motivations and objectives of the industries’ various participants; know how mineral reserves are defined and estimated, and how they evolve over time.
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Seminar on gender diversity spillovers through ownership networks at FAME|GRAPE. Presenting novel research. Studies in economics and management using econometrics methods.
The bright line test and other tax considerations in relationship property settlements
1. A
lthough the tax implications of
relationship property settlements
are rarely front-of-mind, they can
have significant consequences. It is important
any tax implications are properly considered
and reflected in the agreement to achieve a
fair settlement. This article discusses the
general tax principles relating to the settle-
ment of relationship property, including the
potential effect of the new ‘bright line’ test
for residential property recently introduced
on 1 October 2015.
The general rule
For relationship property purposes, the
general rule is that the transfer of property
under a settlement of relationship property
does not trigger an income tax obligation.
However, that does not prevent an income
tax liability arising should the transferee
subsequently dispose of the asset.
This is different from the position in the
normal course of business, where the sale of
business assets will generally be treated as
a taxable event, triggering likely tax conse-
quences. This includes tax consequences on
business assets which are sold or realised prior
to the settlement of relationship property
with the intention of using those proceeds
in the settlement.
Relief from income tax for relationship
property purposes covers a range of assets
commonly used in business, including shares
and options, land, timber or timber rights,
patents, trading stock, livestock personal
property and leased assets.
While the transfer of property under a
settlement of relationship property does not
usually trigger an income tax obligation, this
does not mean any income tax obligation
relating to the property will be eliminated,
just that the responsibility will be transferred
to the new owner along with the property
and so effectively deferred to a later time.
On transfer, this means the new owner
acquires both the property and also its
tax-relevant characteristics. This includes
the transfer of the owners’ intentions at the
date of acquisition. For example, if ‘John’
purchased a classic car with the intention
of later resale, any subsequent gain on sale
made would be likely to be taxable. If this car
was then transferred to ‘Jess’ on separation,
she would not only receive the car but also
the ‘intention’, meaning any subsequent
gain on sale would remain taxable income.
The transferee essentially steps into the
shoes of the transferor, and so they should
be aware if any such intentions exist, prior
to agreeing to the asset transfer.
Who do (and don’t) the
concession rules apply to
To qualify for the relief described above, the
property transfer must be made under a set-
tlement of relationship property, involving the
parties to a relationship property agreement.
Currently, only married couples, the
parties to a civil union, or people in a de
facto relationship, are defined as parties
to a relationship property agreement. This
means that if your clients agree on other
options for dealing with their assets, such
as transferring property into a trust, the tax
concessions cannot apply (because the trust
is not a party to the relationship property
agreement).
This may create unintended tax conse-
quences. For example:
A couple decide to separate after 10
years together. They have entered into
a relationship property agreement and
agreed that the husband will transfer the
commercial property that was owned by
him personally to a trust settled by the
wife. The husband has claimed $50,000
in building depreciation (before 2011)
and the property has increased in value.
As the transfer to the trust does not
qualify as a settlement of relationship
property, the tax concessions that would
otherwise apply are not available. The
husband will have to declare $50,000 of
taxable income (depreciation recovered)
in the year of transfer.
To counter situations like this, amendments
have been introduced that will broaden the
circumstances when the concessions will
be available. These proposed changes are
contained in the Taxation (Annual Rates for
2015–16, Research and Development, and
Remedial Matters) Bill. The revised definition
of ‘settlement of relationship property’ is:
“a transaction under a relationship
property agreement that creates a
disposal and acquisition of property
between –
i. a person who is a party to the relationship
agreement or is associated with a party
to the agreement:
ii. another person who is a party to the
relationship agreement or is associated
with a party to the agreement:”
At the date of this article the bill has been
through its second reading, and so appears
likely to be passed in its current form. The
changes will take effect from enactment
with no retroactive change, so they will not
affect the financial position of anyone who
has previously settled relationship property.
Be aware of the bright-line
Recent changes to the tax rules made with
a view to dampening the strong Auckland
residential property market now mean that
where residential property that is not a
primary residence is sold within two years of
acquisition, any financial gains are generally
subject to tax at the owner’s marginal rate
of tax.
In particular, on 1 October 2015, what
is referred to as the ‘bright-line’ test came
into play to help tax authorities identify
residential property transactions that fall
into this category.
As explained, the transfer of property
under a relationship property settlement
is not currently considered a taxable event.
Accordingly, the transfers of property under
a relationship property agreement will not be
subject to a tax liability under the ‘bright-line’
test. The property is deemed to have been
transferred at cost and the original acquisition
date still applies.
However, any subsequent sale of the
transferred property may be subject to the
bright-line test, if it occurs within the two
year period from when it was purchased.
While this doesn’t apply to the main home,
it does cover any holiday homes or rental
properties.
The introduction of the ‘bright-line’ test
indicates the need to identify any residential
properties (other than the family home)
that have been acquired after 1 October
2015, as these could give rise to a potential
tax obligation following separation for the
party to whom the property is transferred
if held for less than two years.
There may also be a value impact on the
property for relationship property purposes
due to a reduced ability to sell the property
in the short term without triggering a tax
liability. This is particularly in situations
where one of the parties is forced to sell
the property due to their changed personal
circumstances. As such, where the sale of
the property appears likely or necessary
at the separation date, it may be that the
relationship property settlement reflects this
tax liability in some way or provides for some
form of tax warranty should a liability arise.
Summary
While the general rule is that transfers of rela-
tionship property do not give rise to a taxable
event, this does not mean tax implications
can be ignored. As the new “bright-line” test
on residential property demonstrates, tax
considerations can directly impact the values
at which relationship property is settled and
so should be carefully considered as part of
any settlement discussions.
Jay Shaw is a Partner at Grant Thornton.
He has 15 years’ experience in assisting with
the financial aspects of relationship property
settlements, including business valuations and
financial investigations. You can contact him
at jay.shaw@nz.gt.com.
DanLoweisataxassociateatGrantThornton.
He has significant tax consultancy experience
withaparticularfocusoneffectivetaxstructuring
including for relationship property purposes.
You can contact him at dan.lowe@nz.gt.com.
The ‘bright-line’ test and other
tax considerations in relationship
property settlements
JAY SHAW AND DAN LOWE
Financial issues
in relationship
property
Grant Thornton New Zealand Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member
firms are not a worldwide partnership. GTIL and its member firms are not agents of, and do not obligate, one
another and are not liable for one another’s acts or omissions. Services are delivered by the member firms.
We can help.
Grant Thornton offers high quality, independent and clear financial
opinions that can help you navigate the complexity of your situation.
Contact:
Jay Shaw
Partner, Corporate Finance
T +64 (0)9 300 5804
E jay.shaw@nz.gt.com
www.grantthornton.co.nz
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