The document outlines a Quantitative Services lunch and learn agenda covering various technical tax topics: introduction to QS, Uniform Capitalization rules, research credit, accounting method changes, Section 199 deduction, transaction costs, and Tangible Property Regulations. QS assists clients with applying tax regulations and laws to their specific situations. Good targets are any companies, especially those coming out of net operating losses or seeking to decrease effective tax rates. The presentations provide overviews of the various technical topics and opportunities clients may have regarding compliance, credits, deductions, and accounting methods.
KEY Group a Phenix Consulting company - For the success of our clients we connect Finance, Tax and Technology. We want to be recognized as a leading boutique for Finance, Tax and Technology by our clients, employees and business partners.
An informative webinar featuring Robert A. Kolosky and Chuck Pribble of McGladrey LLP, who will discuss changes in Illinois tax laws that affect the Graphic Arts companies in the state as well as continued compliance. We also will discuss the possible sunset on August 30, 2014, of the Manufacturer’s Purchase Credit (MPC) earned on purchases of graphic arts and manufacturing machinery and equipment.
Market disruptions coupled with regulatory and legal changes have transformed how CPAs should be guiding their marine manufacturing clients forward. Today’s effective advisors are business partners - advising their marine manufacturing clients on not only their tax return and financial statement, but ever-changing industry and market trends and disruptions. Every marine manufacturer should be focused on these key areas when working with their CPA: R&D Credits, 199A Deduction, Sales & Use Tax and Market Consolidation.
In order to get buy-in from senior management it is often about setting the right priorities, understanding the root cause of underperforming and select a method for measurement that best fits. The deck explains what a tax function could do to get indirect tax higher on the priority list of senior management.
Jimmy Gentry presents "Teaching Financial Statements" during the Reynolds Center for Business Journalism's annual Business Journalism Week, Jan. 4, 2014. Gentry is the Clyde M. Reed Teaching Professor at the University of Kansas' School of Journalism and Mass Communications.
The annual event features two concurrent seminars, Business Journalism Professors and Strictly Financials for journalists.
For more information about business journalism training, please visit http://businessjournalism.org.
KEY Group a Phenix Consulting company - For the success of our clients we connect Finance, Tax and Technology. We want to be recognized as a leading boutique for Finance, Tax and Technology by our clients, employees and business partners.
An informative webinar featuring Robert A. Kolosky and Chuck Pribble of McGladrey LLP, who will discuss changes in Illinois tax laws that affect the Graphic Arts companies in the state as well as continued compliance. We also will discuss the possible sunset on August 30, 2014, of the Manufacturer’s Purchase Credit (MPC) earned on purchases of graphic arts and manufacturing machinery and equipment.
Market disruptions coupled with regulatory and legal changes have transformed how CPAs should be guiding their marine manufacturing clients forward. Today’s effective advisors are business partners - advising their marine manufacturing clients on not only their tax return and financial statement, but ever-changing industry and market trends and disruptions. Every marine manufacturer should be focused on these key areas when working with their CPA: R&D Credits, 199A Deduction, Sales & Use Tax and Market Consolidation.
In order to get buy-in from senior management it is often about setting the right priorities, understanding the root cause of underperforming and select a method for measurement that best fits. The deck explains what a tax function could do to get indirect tax higher on the priority list of senior management.
Jimmy Gentry presents "Teaching Financial Statements" during the Reynolds Center for Business Journalism's annual Business Journalism Week, Jan. 4, 2014. Gentry is the Clyde M. Reed Teaching Professor at the University of Kansas' School of Journalism and Mass Communications.
The annual event features two concurrent seminars, Business Journalism Professors and Strictly Financials for journalists.
For more information about business journalism training, please visit http://businessjournalism.org.
Aegon 2h 2018 results and new targets presentationAegon
Aegon published its 2H 2018 financial results on February 14, 2019. In this presentation CEO Alex Wynaendts and CFO Matt Rider outline the key facts and figures for the review period and outline the strategy behind Aegon's new financial targets for 2019-2021.
Bodmin - Essential 6-monthly Finance Directors' Update – Nov/Dec 2016 PKF Francis Clark
Our six-monthly Finance Seminars provide a high level overview of the most important technical developments in financial reporting and taxation. The seminars address the key topical financial matters, the opportunities they present, how they affect your business and the pitfalls you can avoid.
Taunton - Essential 6-monthly Finance Directors' Update – Nov/Dec 2016PKF Francis Clark
Our six-monthly Finance Seminars provide a high level overview of the most important technical developments in financial reporting and taxation. The seminars address the key topical financial matters, the opportunities they present, how they affect your business and the pitfalls you can avoid.
Tax Health Check Services, We provide the customer with the tax health check program that focus very much on the compliance position and tax filing procedures of your company
Doanh Duc Tax Consulting Corporation
www.doanhduc.com
International Tax Reform - Tax Cuts and Jobs Act of 2017gppcpa
This presentation is an overview of the new tax law and how it impacts international taxation including such topics as the Participation Exemption, Transition Tax, Global Intangible Low-Taxed Income, Foreign-Derived Intangible Income, Base Erosion and Anti-Abuse Tax, and Interest Deductibility.
Camping Puente Pexoa , Riachuelo - Corrientes , Argentina
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Aegon 2h 2018 results and new targets presentationAegon
Aegon published its 2H 2018 financial results on February 14, 2019. In this presentation CEO Alex Wynaendts and CFO Matt Rider outline the key facts and figures for the review period and outline the strategy behind Aegon's new financial targets for 2019-2021.
Bodmin - Essential 6-monthly Finance Directors' Update – Nov/Dec 2016 PKF Francis Clark
Our six-monthly Finance Seminars provide a high level overview of the most important technical developments in financial reporting and taxation. The seminars address the key topical financial matters, the opportunities they present, how they affect your business and the pitfalls you can avoid.
Taunton - Essential 6-monthly Finance Directors' Update – Nov/Dec 2016PKF Francis Clark
Our six-monthly Finance Seminars provide a high level overview of the most important technical developments in financial reporting and taxation. The seminars address the key topical financial matters, the opportunities they present, how they affect your business and the pitfalls you can avoid.
Tax Health Check Services, We provide the customer with the tax health check program that focus very much on the compliance position and tax filing procedures of your company
Doanh Duc Tax Consulting Corporation
www.doanhduc.com
International Tax Reform - Tax Cuts and Jobs Act of 2017gppcpa
This presentation is an overview of the new tax law and how it impacts international taxation including such topics as the Participation Exemption, Transition Tax, Global Intangible Low-Taxed Income, Foreign-Derived Intangible Income, Base Erosion and Anti-Abuse Tax, and Interest Deductibility.
Camping Puente Pexoa , Riachuelo - Corrientes , Argentina
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Utilizziamo tecnologie innovative ed un know how in costante evoluzione.
I nostri prodotti ed i nostri sistemi sono contraddistinti da una concezione Made in Italy: sinonimo di affidabilità e funzionalità e frutto di un attento lavoro di squadra.
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Edgewater Ranzal Oracle Ace and Director of Technology Mike Killeen was invited to present on the need for profitability and cost management, at Oracle EPM Day in New York.
Management presentation from Thermal Energy International's 2020 Annual General Meeting of Shareholders. Provides a summary of the results of phases 1 & 2 of the Company's strategic plan; our efforts to mitigate the impacts of the COVID-19 global pandemic; highlights our digital transformation initiatives; and reviews our fiscal 2020 year-end and fiscal 2021 First Quarter financial results.
If your company spends money on improving its product, developing new products or improving processes you could be missing out on hundreds of thousands of dollars.
Learn basic accounting principles you need to successfully run your business. This deck covers the essentials, including financial statements like balance sheets, income statements, statements of cash flow, governance, and tax considerations.Taught by Brendan McCorry, Justin Vogel, and Sonal Shah of Ernst & Young
Original air date: Dec. 6, 2017
Rebroadcast and recording info at http://www.mhmcpa.com
The research and experimentation credit recently was enhanced to give small businesses greater access to its benefits. Eligible small businesses can now elect to offset their liability for AMT or payroll tax with research credits, where many payroll tax returns filed in the fourth quarter of 2017 will first see these credit claims.
As we explore many of the activities that qualify small businesses to the research credit, we will also review the eligibility criteria for the payroll tax offset, as well as the manner in which the payroll tax offset works for employers using PEOs to lease employees.
Management presentation from Thermal Energy International's 2019 Annual General Meeting of Shareholders. Provides a summary of the results of phase 1 of our strategic plan and highlights of our strategy going forward.
4. Page 4
What is Quantitative Services (QS)?
► The QS practice is focused on assisting clients with
application of federal tax regulations and laws to their
specific facts and businesses in the following technical
areas:
► Tangible Property Regulations
► Research Credit services
► Accounting Methods
► Inventory
► Section 199 Domestic Manufacturing Deduction
► Transaction Costs
► Meals & Entertainment
► Capitalization and Depreciation
5. Page 5
What makes a good QS target?
► Any company is a good target!
► Taxpayers
► Companies coming out of an NOL position
► Companies that need to clean up exposures and risks
► Companies that want to decrease ETR
9. ► Compliance
► Verify compliance with capitalization rules/regulations.
► IRS can challenge the company’s position:
► IRS Audit
► Company Exposure
► Efficiency
► Improve financial reporting capabilities through greater predictability and
timeliness.
► Substantial time savings in calculation preparation and record-keeping
processes.
Why is this important?
10. Page 10
Potential Opportunities
► Taxpayers that capitalize
accounts that are
excludible for tax
purposes.
► Ex. Warranty, Freight out,
R&D costs, etc.
Negative 263A Costs
12. Page 12
Purpose of the Credit
► Established to encourage U.S. businesses to increase
investments in developing new and improved
technologies, products, and processes.
► Goal was to make U.S. companies more competitive
through creation of technologically improved products and
processes and to encourage businesses to increase their
R&D spending.
13. Page 13
Summary of Research Credit Rules
► Qualifying research expenses
► Wages
► Supplies
► Contract research expenses
► Four-Part Test
► Technical Uncertainty
► Process of Experimentation
► Technological in Nature
► Functional Development
14. Page 14
Opportunities Related to R&D
1
Requirements NON-Software Software
Innovative test
Significant economic
risk test
Not commercially
available test
Non internal-use
software
Dual function software
R&D Credit
Opportunities (IRC §41)
3
3
Technological in nature
Process of
experimentation
New or improved
functions
Technical uncertainty
R&D Credit
Opportunities
(IRC §41)
Internal-use software
R&D Credit
Opportunities (IRC §41)
Proposed
Regulations
Deductible software
development costs
Rev. Proc. 2000-50
Deductible Expense
(IRC §174)
15. Page 15
Existing Clients: R&D Conversation Starters
► Has significant R&D-related expenditures
► Has large amount of software as a new asset appearing on tax
return
► Has annual revenues $1 billion
► Within computer services industry or producer of product held for
sale
► Pays or expects to pay regular tax
► Focused on reducing federal/state ETR
► Already utilizing EY for Section 199 services
16. Page 16
Existing Clients: R&D Risks
► Prohibitive controlled/aggregated group arrangement and/or
research credit computation
► Has “funded” research
► Has research conducted outside the U.S.
17. Page 17
Existing Clients: Increased R&D
Service Offering Opportunities
► Claiming research credit but no contemporaneous documentation
► Claiming federal but not state research credit
► Claiming research credit only based on those conducting R&D; not
on those supporting or supervising
19. Page 19
Purpose
► Tax treatment is established in either first or second year,
and filing method change is required in order to move
forward with new method
► Incorrect method
► Two years of filing, incorrect method is the established method
► Correct method
► One year of filing, correct method is the established method
► May be an advantageous or preferred method
20. Page 20
► Software development costs
► Immediate expense, 36-month, or 60-month deferral
► Companies undertaking enterprise resource planning
► Companies with large software expenditure amortization
► Prepaid expense acceleration
► Expense amounts paid to create any right or benefit for the
taxpayer that does not extend beyond:
► 12 months after the date of realizing the right or benefit
► End of tax year in which payment is made
► Insurance, warranty & service contracts, license, software
maintenance, taxes (business/ real estate/ personal property)
Common Types Filed
21. Page 21
► Revenue deferral
► Recognize income from an advance payment in the tax year of
receipt to the extent the payment is recognized in applicable
financial statements
► Remaining amount recognized in the next succeeding tax year
► Services, sale of goods, use of intellectual property, sale/ lease/
license of computer software, sale of gift cards
► Accounts receivable
► Identify receivables that can be deferred or excluded from income
recognition and/or accelerate deductions related to receivables
Common Types Filed
23. Page 23
Qualified Activities
► Domestic Production Gross Receipts (DPGR):
► Manufacture tangible personal property
► Produce qualified film
► Produce electricity, natural gas, or water
► Construction of real property
► Service of architecture/engineering
► Software Development
1 January 2014 Presentation title
24. Page 24
Software Development
► §1.199-3
► DPGR include gross receipts from computer software
services if:
► 1) Taxpayer also derives gross receipts from lease, rental, or other
disposition of computer software
► 2) Another person derives gross receipts from lease, rental, or
other disposition of substantially identical software
1 January 2014 Presentation title
25. Page 25
Value for the Client
► Reduce Taxable Income
► Permanent tax savings
► Reduce Effective Tax Rate
► Increase Earnings & Profit
► Increase Cash Flow
12 July 2016
27. Page 27
Transaction Cost Analysis
► Fees for professional services in connection with
transactions
► Transactions:
► Third- Party domestic Acquisition
► Internal restructuring
► Initial public offerings
► Bankruptcies
1 January 2014 Presentation title
29. Page 29
Tangible Property Regulations
► Change in accounting method for the treatment of tangible
property.
► Effective for tax years beginning on or after January 1,
2014.
► Breakdown of the TPR
► Materials & Supplies
► Acquisitions
► Improvements
► General Asset Accounts (GAA) and Dispositions
30. Page 30
Moving Forward with TPR
► Maintaining the method
► Ensure clients have not “blown” their methods
► Filing annual elections
► De minimis safe harbor election
► Election to capitalize otherwise deductible repairs
31. Page 31
Retail-Restaurant IIR
► Rev. Proc. 2015-56
► Remodel-Refresh Safe
Harbor
► Deduct 75% and capitalize
25% of qualifying remodel
costs
► Simplified formula
► Conclusions under the
TPR
► Impact of IRC Section
263A
► Dispositions
► Form 3115 and 481(a)
adjustment
32. Page 32
Remodel-Refresh Safe Harbor
Calculation
total fixed asset additions (per AFS)
(subtract listed exclusions)
= qualifying remodel-refresh costs
75% deducted 25% capitalized
25% Improvement Asset
► Recovered over 15 or 39 years
► Section 263A does not apply
► Included in a group GAA
► Depreciate out unless
entire store location is
disposed of
General Operation of the Safe Harbor
33. Page 33
EY Depreciation System (EYDS)
► Technology-based service to assist clients in:
► Compliance with tax depreciation/amortization guidance
► Tax planning opportunities
► EYDS can result in significant tax benefits including:
► Reduces federal and state effective tax rates.
► Streamlines tax compliance in the deprecation/amortization space.
► Streamlines reviews and audits.
► Supports a wide range of federal and state depreciation methods
and reporting.
34. Page 34
Target Market/Profile
► Companies in all industries and all sectors
► Significant investments in capital assets or intangible assets
► Companies willing to amend tax returns or interested in
tax benefits on current year returns.
35. Page 35
Next Steps: Let us know!
► Does your client have any high accrual balances?
► Does your client employ engineers, scientists, software
developers?
► Does your company manufacture goods?
Hey guys, my name is Dan Chang, I’m a staff 2, and I will be introducing you to UNICAP.
let’s use an example
Let’s say a company makes cameras. Now you would THINK you’d know all the costs related to this camera, but according to UNICAP, there are more costs than you think.
Now let’s disassemble the camera into separate parts.
Each cost of these camera parts are directly or indirectly related to the production of the camera.
For example: the freight in costs of direct materials, depreciation of equipment shaping the metal casing, the repair and maintenance costs related to that equipment, compensation & benefits of employees directly working with the camera parts.
So hopefully this example helps you understand how much is involved with UNICAP.
SO why is this so important?
My colleagues will talk about different projects QS has…and while their projects may provide a benefit to companies. UNICAP MAY provide benefits to a company, but it mostly provides risk reduction.
Companies need to be compliant to cap rules/regs to reduce the risk of the IRS challenging a companies position, auditing them, and opening for unwanted exposure.
For the past 6-7 months, I’ve worked on many UNICAP calcs and different clients. And almost all my clients have something in common: the trial balances are a mess: they don’t have proper cost centers, departments, and sometimes merge two accounts together that don’t comply with UNICAP rules.
UNICAP ensures that a company would be compliant with cap rules.
It will also provide efficiency:
Many of our clients attempt to calculate UNICAP internally and if you don’t know UNICAP rules, it’s extremely time consuming. Not only that, but if you follow an incorrect method for years….and if the IRS challenges their position, they have no way of explaining their calculation.
Proper UNICAP calculations provide
With proper UNICAP calculations, you have increased accuracy in financial reports: mainly 481(a) adjustments, you save a ton of time in calculating UNICAP in the future, and have a record-keeping process so when the IRS challenges a company, they’re able to provide documentation and easily explain their calculation and how they’re compliant with 263A rules.
Like I said before, UNICAP provides risk reduction, but also can provide benefits such as Negative 263A.
With proper UNICAP calculations, companies can immediately expense these costs and potential have favorable 481(a) adjustments
-Section 199 – Domestic Production Activity Production – Tax deduction for businesses that perform domestic manufacturing and certain other production activities
Created to ease the tax burden on domestic companies in 2004, seen as an incentive to keep factories in the US instead of sending them to other countries
-In 2010 the deduction maxed out at a 9% of the lesser of QPAI or Taxable Income, limited to 50% of W-2 wages
-S corps and Partnerships can utilize this deduction, is allocated based on ownership percentage
-Film : as long as 50% of total compensation relating to production was completed within the US
-Must produce, not just transport
-Lease, rental, or other disposition of computer software MPGE by the taxpayer in US, qualify as DPGR, even if software is provided to employees or over the internet
-Receipt from customer and tech support, online services (online banking), do not constitute as DPGR
If customer is given app to access computer software it will be considered lease, rental etc if:
Taxpayer also derives gross receipts from lease, disposition to customer that are not related person of computer software that, has only minor differences form online software, has been MPGE by taxpayer in US, and has been provided to customer in tangible medium or download onto computer
Another person derives GR from lease, rental, disposition of substantially identical software to its customers pursuant to an activity in part 3 of exception 1
Example 2.
M is an Internet auction company that produces computer software within the United States that enables its customers to participate in Internet auctions for a fee. Under paragraph (i)(6)(ii) of this section, gross receipts derived from online auction services are attributable to a service and do not constitute gross receipts derived from a lease, rental, license, sale, exchange, or other disposition of computer software. M's activities constitute the provision of online services. Therefore, M's gross receipts derived from the Internet auction services are non-DPGR.
Example 4.
O produces tax preparation computer software within the United States. O derives, on a regular and ongoing basis in its business, gross receipts from both the sale to customers that are unrelated persons of O's computer software that has been affixed to a compact disc as well as from the sale to customers of O's computer software that customers have downloaded from the Internet. O also derives gross receipts from providing customers access to the computer software for the customers' direct use while connected to the Internet. The computer software sold on compact disc or by download has only minor or immaterial differences from the online software, and O does not provide any other goods or services in connection with the online software. Under paragraph (i)(6)(iii)(A) of this section, O's gross receipts derived from providing access to the online software will be treated as derived from the lease, rental, license, sale, exchange, or other disposition of computer software and are DPGR (assuming all the other requirements of this section are met).
Look for clients coming out of NOL in near future
Focus on clients who make substantial investment in software
Increased cross-border and contract manufacturing arrangements
-Section 199 – Domestic Production Activity Production – Tax deduction for businesses that perform domestic manufacturing and certain other production activities
Created to ease the tax burden on domestic companies in 2004, seen as an incentive to keep factories in the US instead of sending them to other countries
-In 2010 the deduction maxed out at a 9% of the lesser of QPAI or Taxable Income, limited to 50% of W-2 wages
-S corps and Partnerships can utilize this deduction, is allocated based on ownership percentage