Articles

The U.S. Department of Treasury and the IRS have issued sweeping proposed regulations implementing information reporting and withholding tax provisions for foreign financial institutions (FFIs). Although the proposed regulations are targeted at FFIs, they drive home the need for individual taxpayers with foreign accounts to be vigilant about compliance with their own reporting obligations.

In December, Congress was able to pass only a two-month extension of payroll tax relief — on the condition that Senate and House conferees be appointed to work on a full-year extension. That conference committee now has negotiated an agreement, and the Middle Class Tax Relief and Job Creation Act of 2012 will extend through December 31, 2012, the 2010 Tax Relief act provision that reduced the employee portion of the Social Security tax on earned income from 6.2% to 4.2%.

At a time when reimbursement rates are being squeezed, what you don’t need is someone surreptitiously removing money from your practice. Yet, that’s exactly what some staff members are doing to the practices that employ them.

In the health care reform law, downward pressure on physician reimbursements and the need for capital are all driving an anticipated next wave of physician practice consolidation. Although some doctors have avoided these problems by accepting employment with a hospital, many others are exploring the option of merging with or acquiring other physician practices.

As of 2006, almost 59% of hospitals in the U.S. were tax-exempt under IRC Section 501(c)(3) (organized and operated exclusively for “charitable” purposes).  The Patient Protection and Affordable Care Act of 2010 added IRS Code Section 501(r), addressing a charitable hospital’s fulfillment of its charitable purpose as a tax-exempt organization.

High growth companies are focused on new products, building revenue and expanding, leaving little time or inclination to manage back office operations.  Constantly being asked to do more with less, many CFOs have turned to creative forms of outsourcing and cloud-based automation to improve their financial systems and staffing.  This is especially true of high growth companies that want to keep the majority of their staff focused on developing products, finding and servicing customers.  Collaborative Outsourcing offers an advantageous balance of value and control for today’s CFO.

The IRS has announced a new program that allows eligible employers to voluntarily reclassify workers as employees, rather than independent contractors, for future tax periods. In exchange, the employers’ liability for past payroll tax obligations will be reduced to only a minimal payment. The Voluntary Classification Settlement Program (VCSP) is intended to increase tax compliance and reduce the tax and administrative burdens on employers with misclassified workers.

As the end of the year approaches, it’s always a good idea to review your tax situation and assess whether there are any actions you should take by Dec. 31 to reduce your tax bill. This year is no exception, and many opportunities are available that may significantly reduce your taxes. However, 2011 also presents some unique challenges.

There’s no question that the struggling economy has had a negative impact on the value of many businesses and investments. But it also influences the business valuation. On Nov. 16, Congress passed legislation repealing a controversial law that would have required federal, state and local government entities with total annual expenditures of $100 million or more to withhold 3% of certain payments for goods and services to government contractors and vendors.

There have been discussions about separate private company accounting standards for years. Now standard-setters may actually do something about it. The Financial Accounting Foundation (FAF) — parent organization to the Financial Accounting Standards Board (FASB) — will soon decide whether to adopt recommendations made earlier this year by a blue-ribbon panel on standard setting for private companies.