Why You Should Attend: Do  you stay in touch with your business clients throughout the year?  The Colorado Unclaimed Property Act [CRS 31-13] requires businesses in Colorado to identify and report abandoned property as of June 30 each year, and report and remit that property to the Department of Treasury, Unclaimed Property Division by November 1.

The Colorado Unclaimed Property Act was enacted in 1987.  Despite its several decades of existence, many businesses (and CPAs) find that they are not aware of the Act and its requirements.  This often overlooked regulation helps your clients by reducing their long outstanding liabilities and risk of fraud, and improving SOX compliance.  If a business is found to have overlooked the requirements of the Act, it may be subject to an audit by the Unclaimed Property Division, as well as interest and penalties.

Learn how you can help your clients become familiar with the regulation and its requirements, their responsibilities, and risks of non-compliance.  If your client has not been reporting, you can still help them avoid interest and penalties by conducting a voluntary self review.

Course Description: This instructor-led course will provide you with an overview of the Colorado Unclaimed Property law; explain holder responsibilities and reporting processes; provide tips for CPAs to conduct or help clients perform voluntary compliance audits; and also discuss the claims and reimbursement processes.

What you will learn: By attending this course, you will obtain a better understanding of the Colorado unclaimed property requirements in order to educate your clients and assist them in meeting their obligations under the law.

Faculty:
Patty White, Director
Garth Farrend, CPA Audit Manager
Clyde Isenhart, Auditor
John Olson, Auditor
Colorado Unclaimed Property Division

Samantha Petersen, Managing Director
Jim Weigand, Manager
True Partners Consulting LLC

Location:
Department of Revenue
Auto Industry Division Conference Room 110
1881 Pierce Street
Lakewood, CO  80214

When: June 13, 2012
Time: 1:00 PM – 3:00 PM  Mountain Time
Fee: There is no fee to attend this course

How to register:
Contact Clyde Isenhart at 303-866-6159 or by  email at Clyde.Isenhart@state.co.us

View Flyer

Thursday June 21, 2012 – UBS Tower and Conference Center
9:00am – 4:30pm

Thursday June 21, 2012 – Webcast
9:00am – 4:30pm

All NEW program designed specifically for attorneys and other professionals working with and for businesses. Receive critical updates and benefit from a high-level curriculum that includes expert commentary and practice advice on major business topics such as valuation, sale and merger, employment matters, and tax regulations. Plus, network with your colleagues at a lunch sponsored by Stout Risius Ross, Inc., Chicago.

This invaluable, new IICLE® institute program focused on the most pressing business issues for attorneys and other professionals. You will benefit from a high-level curriculum that includes expert commentary, updates and practice advice helping you to become well-versed in today’s business challenges and questions.

Moderator: Gian G. Ricco, Stout Risius Ross Inc., Chicago

The Developing New World of Non-Compete Agreements
Fallout from Reliable Fire Equipment vs. Arredondo before the Illinois Supreme Court …Did it clarify the Law? Drafts, Litigation and Arguing the Case
Anthony C Valiulis, Much, Shelist, Denenberg, Ament & Rubenstein, P.C., Chicago
Irving M Geslewitz, Much, Shelist, Denenberg, Ament & Rubenstein, P.C., Chicago

Life after the Deal
The business owner’s life is usually tied to the success or failure of a business. Most often a business owner is so involved with the business they fail to integrate the success of their business with their family’s long term financial goals. In this session we will discuss the top five considerations a business owner should think about when accumulating his wealth, managing his risk, and planning for life after the business. We will explore how portfolio construction, taxes, legal issues, and family dynamics impact a business owners’ long term wealth.
Jim King, CPA, CFP, Balasa Dinverno & Foltz, Itasca

Valuation Issues Surrounding Shareholders’ Agreements
Frequently, disputes involving shareholders’ agreements derive from faulty, incomplete, or contradictory language concerning valuation issues. This presentation will demonstrate key areas of concern and propose appropriate language to address potential disputes. Various aspects of valuation typically embedded within a shareholders’ agreement will be addressed.
Christopher P. Casey, CPA, CFA, ASA, Stout Risius Ross, Inc., Chicago

Merger and Acquisition Financing Update
The topic will be Mergers and Acquisition Financing Updates. Improving M&A trends in 2012 (and beyond) compared to the last few years will be discussed. We will go over what your business owner clients need to know when beginning a M&A deal, so their banker feels comfortable with the transaction. We will also cover what criteria is important to banks when underwriting a M&A deal. Financing terms and amortizations based on level of collateral will also be highlighted as well.
Darren C. Baker, Schiff Hardin, LLP, Chicago
Vincent J. Pappalardo, Stout Risius Ross, Inc., Chicago
Jason Chess, MBA, The Private Bank, Lake Forest

Unclaimed Property
Unclaimed property audits are on the rise as states look for new ways to increase revenue. Even companies with long histories of compliance are now targeted for audits, with assessments reaching into the millions. The session provides an overview of the unclaimed property issues facing companies, including the impact of increased financial disclosure requirements, media scrutiny, to determine whether your client is at risk, how to resolve past exposure, and what to do if contacted for an unclaimed property audit.
Robert Tucci, True Partners Consulting LLC, Chicago

Electronics in the Workplace – effective and appropriate management and policies
Facebook, blogs, twitter, IPhones, placing and protecting information on your website and using material you find on the web
Eugene Boyle, Neal Gerber & Eisenberg LLP, Chicago

IP Law & Case Law Update
Current IP Trends and Case Law
Michael Baniak, McDonnell Boehnen Hulbert & Berghoff, LLC, Chicago

It is our goal that, after attending this course, an attorney will be better able to:

• Analyze the benefits and risks of social media and implement effective procedures for control.
• Write effective policies for employee use of smart phones, iPads and other technologies at work.
• Protect customers and sensitive information when an employee leaves the company.
• Provide good direction to clients about their options following the sale of a business.
• Write and evaluate solid shareholder agreements to avoid disagreements regarding valuation issues.
• Learn about how to handle and treat unclaimed property.Protect clients’ intellectual property (IP) and identify issues that might compromise IP rights.

Minimum CLE/CPE Accreditation: IICLE is an accredited sponsor for Illinois and most other states having minimum CLE requirements and mandatory CPE requirements for CPAs. Reporting instructions will be available at the programs.

Register

When the Government issued temporary and proposed “repair” regulations in December 2011, they said that implementation procedures would be forthcoming.  On March 7, 2012, the Government issued Revenue Procedure 2012-19, providing automatic consent procedures regarding the deduction and capitalization of expenditures made to acquire, produce, or improve tangible personal property.  At the same time, they also released Revenue Procedure 2012-20, addressing depreciation, disposition, and related method changes for tax years beginning on or after January 1, 2012…

Full Article

American Express, InComm, and Blackhawk Pull Out of State

By now, most national retailers are familiar with the changes brought about by 2010 N.J. Laws Chapter 25, (“the Act”), impacting the treatment of gift or stored value cards (“Gift Cards”) and the subsequent litigation challenging the Act. Although sections of the Act focused on the issuers of money orders and travelers checks, much of the recent media attention has focused on the impact of the Act on issuers of Gift Cards…

Read Full Article

True Partners Consulting’s National Unclaimed Property Practice Leader, Cathleen Bucholtz, will present in Bloomberg BNA’s Unclaimed Property Webinar

Unclaimed Property: Defending Against Aggressive Enforcement Tactics

Speakers: Cathleen Bucholtz, True Partners Consulting and Ethan Millar, Alston & Bird LLP

Date: April 26, 2012
Time: 11:30 am – 1:00 pm CT
Register: Click Here

As states struggle to close budget gaps, many have aggressively pursued unclaimed property audits and expanded the types of property subject to escheat laws to include items such as gift cards. Enforcement practices such as the hiring of contingent-fee auditors and the use of certain estimation methodologies have created situations in which a business that is a “holder” of unclaimed property could end up paying a state more than is actually owed.

Adding to the compliance headache is that each state has adopted its own unclaimed property laws, which makes it difficult of multistate companies to comply with the resulting patchwork of non-uniform requirements.

Recent litigation in New Jersey over a significant expansion of the state’s unclaimed property laws highlights the new compliance requirements states are imposing, and the growing willingness of businesses to challenge them.

The presentation will explore the current landscape in unclaimed property reporting and enforcement.

Presentation Objectives

The webinar will:

• explain what constitutes “unclaimed property”, with a particular focus on “controversial” property types such as gift cards, rebate cards and other promotional incentives
• cover recent developments and trends with respect to unclaimed property
• provide an overview how unclaimed property laws evolved to their present state
• describe the current application of unclaimed property laws across the 50 states
• highlight some of the multistate issues property holders are likely to face
• alert attendees to potential structuring options to reduce state unclaimed property liabilities
• discuss efforts underway to reform unclaimed property laws

The objectives of this webinar include providing participants with a conceptual understanding of:

• the different types of unclaimed property that holders are generally responsible for identifying and reporting to the states
• the various contexts in which unclaimed property issues are likely to arise
• the obligation to comply with state unclaimed property laws
• some of the various techniques state auditors use to uncover unclaimed property

Upon completion of this program, participants will:

• understand the various types of property that may be claimed by states as unclaimed property
• identify the basic legal requirements and audit scenarios arising from unclaimed property laws
• gain insights regarding current developments and trends in unclaimed property law
• understand various structuring techniques to reduce unclaimed property liabilities

Since Fall 2011, New York’s Office of the State Comptroller has been feverishly sending letters to companies that it believes may not be in compliance with New York’s Abandoned Property Law (“Law”), inviting them to participate in the State’s Voluntary Compliance Program (“Program”). In recent weeks the State has been sending “REMINDER – FINAL NOTICE” letters, alerting companies to a final 30-day window to respond. These letters should not be ignored, regardless of your company’s current compliance with the New York Abandoned Property Law.

Download Full Article

Visit us at: www.TPCTaxAppeals.com

WEDNESDAY, MARCH, 21, 2012
9:00 A.M. TO 2:30 P.M.
HYATT REGENCY SANTA CLARA
5101 Great America Parkway
Santa Clara, California
Directions
Please join us for a practical workshop co-sponsored by DLA Piper and True Partners. We will discuss examples of the following hot topics and industry trends:

• Providing stock comp deferreds
  • Modifications
  • Terminations
  • Replacement
• Witholding taxes – reporting and special issues
• Tax updates
• And more

AGENDA:

9:00 a.m. – 9:30 a.m.	Registration and continental breakfast
9:30 a.m. – 12:30 p.m.	Welcome and introduction
12:30 p.m. – 1:30 p.m.	Lunch
1:30 p.m. – 2:30 p.m	Conclusion and questions

4 CPE credits
(CPE credits will be provided by True Partners Consulting)

Register for the seminar here.
Cost $125 per person
(Please make checks payable to True Partners Consulting)

For more information contact Tara Herrera
at tara.herrera@tpctax.com.

The U.S. economy is bouncing back from the recession that began in 2007, but is far from a full recovery. The U.S. still faces a continuing decline in home values, increases in foreclosures and personal bankruptcies, ongoing federal debt issues, and rising gas and food prices. A pressing issue is the persistent high unemployment rate, hovering just below 9%. States strive to help the recovery by…

To read full article click here.

There are a number of business tax provisions that expired after December 31, 2011 (commonly referred to as “extenders”), which will impact companies both in terms of their 2012 interim tax provision calculations as well as their 2012 quarterly estimatedtax payments. Two of these are international provisions which may require some in-depth analysis to determine the impactof their expiration. True Partners Consulting can assist you with this analysis.

To read the full article click here.

Firstly, a Happy New Year!

2012 is already into week 3 and you may be thinking about New Year resolutions having already fallen by the wayside, but if your resolution for 2012 was to reduce your tax liabilities be it, Corporation tax, income tax, employment taxes, National Insurance, VAT, Withholding taxes etc or to recover all the overpaid duties that you never knew you had overpaid, well help is at hand to keep your resolution alive! As with any New Year, there are changes to a number of tax areas which companies need to consider as part of 2012 planning such as:

• location of finance companies,
• shifting IP into a low tax jurisdiction,
• changing supply chain models and implications on tax
• debt write-off’s
• worldwide debt cap rules and planning
• entity reduction in Europe
• transfer pricing documentation requirements,
• permanent establishment risks,
• VAT registrations,
• Employee incentives and share scheme advisory,
• Withholding taxes,
• Control foreign company legislation changes in the UK,
• Introduction of patent box regime,
• R&D tax credits
• Expat remuneration
• Planning to avoid 50% tax charge
• Extraction of funds from companies in the most tax effective way
• Customs duty mitigation etc

This briefing note highlights some of the issues which UK companies and Overseas parent companies
need to consider for 2012. To the extent you have any queries or would like to discuss any of these in greater detail or any area of tax planning, please contact me. Help is at hand!

To download full pamphlet, click here.

As part of its new outreach initiative, Myer Blank, a Senior Manager at True Partners Consulting, appeared on WGN-TV’s morning news show. He discussed how True Partners works to save taxpayers money. He discussed the needs for homeowners to check their exemptions and for all property owners to closely monitor their assessed values.

View Full Clip

Michigan’s Department of Treasury announced in December 2011 that it will be offering companies that have not previously reported unclaimed property, or which have underreported unclaimed property in the past, an opportunity to voluntarily get into compliance with the State’s unclaimed property reporting requirements through a new Voluntary Disclosure Program (“Program”). Under the terms of the Program, Michigan will agree to waive all penalties, as well as applicable interest, on unclaimed property reported and remitted to the State by companies participating in the Program. In order to take advantage of this opportunity, companies must enroll in the Program by completing and submitting the Michigan Unclaimed Property Voluntary Disclosure Agreement (Form 4869) by the January 31, 2012 due date. Once a company has enrolled, it must complete the filing of the report for the current year and the previous four years by July 1, 2012.

To read the full article click here

Green shoots peek through state’s economic frost
Illinois companies embark on comeback, as Illinois’ growth trails the nation’s

January 1, 2012 – For Cary McMillan, CEO of True Partners Consulting LLC, one signal of a strengthening economy in the past year came with a sharp edge: A competing firm offered jobs to about 20 of his staffers and succeeded in luring away about six.

“If business was terrible, they would not have come after my people,” he said. He shared the anecdote with good humor but added, “It was not funny at the time.”

The corporate tax consulting company, founded in 2006 by former Arthur Andersen partners, expects revenue to grow 8 to 10 percent next year and envisions hiring 30 people, not the gangbusters growth the Chicago-based firm saw prerecession but solid nonetheless.

“It would go up more if clients were doing more work on their (tax accounting) systems, but we’re waiting to see how that turns out,” McMillan said. “It’s something they don’t have to do; they can always put it off another year.”

To read full Chicago Tribune article click here

On December 23, 2011, the Government released long-awaited temporary and proposed regulations to clarify the difficult distinctions between currently deductible business repairs and capital improvements. These regulations replace prior proposed regulations issued in 2006 and 2008…

To read the full article click here

True Partners Consulting (UK) LLP will be holding a 40 min webinar on Tuesday 21st February 2012 at 3:00pm UK GMT (US – 9:00am CST).

The purpose of the webinar is to provide an overview and guidance to UK and European Financial Controllers, Finance Directors, In-house tax managers etc on a structured approach for the identification of transfer pricing risk as part of the audit of tax provisions (i.e. statutory accounts preparation and reporting of tax numbers).

The presentation will also focus on risk assessments for trading transactions.

Our presentation will involve specialists from our European affiliates.

Who is this webinar most appropriate for?
• All UK companies and partnerships with employees including ‘Not for Profit’ sector; and
• Any overseas company with operations in the UK and Europe

To register, please contact Abbas Sadak (contact details listed below). Dial in details for the webinar will be provided nearer the time.

Abbas Sadak
Director – UK and European Tax
True Partners Consulting (UK) LLP
P 0207 868 2434 • F 0207 868 1800 • M 07957 303 892
Abbas.Sadak@TPCtax.co.uk

www.TPCtax.co.uk

True Partners Consulting (UK) LLP is holding a 40 min webinar on European and UK VAT on 24th February at 4:30pm UK GMT (US-10:30am CST).

Our experts will cover the following areas:

• Overview of main forms of indirect tax
• Key concepts and issues
• Outline of the UK VAT system
• European Developments
• VAT and Transfer pricing interaction – Intercompany charges
• Case studies

Who is this webinar most appropriate for?

• All UK companies and partnerships with employees including ‘Not for Profit’ sector; and
• Any overseas company with operations in the UK and Europe

Target Audience: CFO’s, Finance Directors, Financial Controllers, VAT teams, International Tax teams, EMEA Tax controllers.

Key client issues:

• Need to comply with ever increasing compliance obligations
• Need to maximise VAT recoveries
• Need to reduce negative impact of VAT on cashflow
• Aim to minimise HMRC Risk rating and reduce risk of penalties
• Desire to simplify administration

Questions for audience to consider as part of the webinar:

• Are you confident that you are accounting for the right VAT at the right time?
• Are you recovering all VAT which you are entitled to reclaim?
• What steps have you taken to train staff to ensure compliance and awareness of major issues?
• How VAT-efficient is your current arrangements?
• When did you last review your current policies and procedures?

Presenters from UK and Germany.

To Register: contact Abbas Sadak

Abbas Sadak
Director – UK and European Tax
True Partners Consulting (UK) LLP
P 0207 868 2434 • F 0207 868 1800 • M 07957 303 892
Abbas.Sadak@TPCtax.co.uk

www.TPCtax.co.uk

True Partners Consulting (UK) LLP is holding a 40 min webinar on Employment Tax Planning & Pitfalls on 7th February at 2pm UK GMT and our experts will discuss how UK employers can comply with HMRC requirements including the Senior Accounting Officer rules while minimizing costs and administration.

Areas that will be covered will include:

• Employment Tax Compliance Reviews
• Drafting Expense policies to ensure compliance and minimise costs
• Mitigating that the risks of engaging self-employed consultants
• Structuring termination packages tax and NIC efficiently
• International NIC planning including 52 week exemptions from UK NIC and the impact of EU Rues; and
• Payroll savings involving converting pay currently liable to tax and NIC into a form that is exempt from PAYE and/or NIC including scale rate payments, pension contributions, car-parking, green travel, child-care etc

Who is this webinar most appropriate for?

• All UK companies and partnerships with employees including ‘Not for Profit’ sector; and
• Any overseas company with employees working in the UK

Target Audience: CFO’s, Finance Directors, Financial Controllers, Payroll team, HR teams.

Key client issues:

• Need to mitigate payroll costs;
• Need to comply with ever increasing compliance obligations
• Wish to Lower HMRC Risk rating
• Desire to simplify administration

Questions for audience to consider as part of the webinar:

• What steps have you taken to manage your payroll costs?
• What steps have you taken to train staff to ensure compliance?
• How tax efficient is your current arrangements?
• When did you last review your current policies and procedures/

True Partners Consulting (UK) LLP approach

• Flexibility – arrangements can be tailored to suit individual client’s objectives;
• Effective –“Win- Win” for company and its employees;
• Tax management – minimises costs of employing staff;

Presenters:

Sue Ollerenshaw – Sue spent five years working in the Inland Revenue as a PAYE Auditor. Since she has spent over twenty five years gaining extensive experience in the profession including working for “Big 4” and “Group A” firms. Sue has headed national practices and the Central region Employer Solutions practice of a Big 4 firm with responsibility for 6 offices and 40 staff. This experience allows Sue to advise clients how to maximize their employees’ total reward while mitigating the company’s payroll costs and ensuring compliance with the onerous employment taxes reporting requirements. Sue has advised a wide range of clients from small owner managed businesses, to not for profit sector organizations up to fully listed blue chip companies across a wide range of sectors.

Abbas Sadak – Abbas Sadak’s longstanding relationships with clients are driven by his high energy, readiness for challenge, and relentless pursuit of tax-saving solutions. He has developed a reputation for integrity, honesty, and commitment during his 15 years in practice. Mr. Sadak trained as an auditor before specializing in UK corporation tax, international tax, and transfer pricing. He is a chartered certified accountant as well as a UK chartered tax adviser. His professional experience includes assisting clients with UK tax compliance matters, European tax advisory and compliance, tax risk management, SOX compliance, assisting multinational groups with multijurisdictional transfer pricing and international tax issues, dealing with UK inbound and outbound investment issues, and co-ordinating VAT and employment taxes work. He has also worked on secondment with the tax projects team at Shell International plc and HMV Group Plc. Mr. Sadak is an accomplished writer and educator. He co-authored Tolley Guidance’s transfer pricing module, and developed “A Tax Checklist for Global Cash Management” for Business Finance magazine’s website.

To register, please contact:

Abbas Sadak
Director – UK and European Tax
True Partners Consulting (UK) LLP
P 0207 868 2434 • F 0207 868 1800 • M 07957 303 892
Abbas.Sadak@TPCtax.co.uk

www.TPCtax.co.uk

As the national real estate market continues to struggle, property taxpayers need to position themselves for potential significant increases to their bills.  Specifically, as residential property values continue to decline in many areas, there may be dramatic tax burden shifts to businesses to pay for the cost of local government.  Taxpayers throughout the country need to be aware of changes to values within their areas, how their properties are valued relative to other properties in their areas, and the specific dates and deadlines for appealing valuation when appropriate.  Failure to appeal could mean increases in future tax liabilities.  In addition to taking action through pursuing property tax appeals, taxpayers also need to budget for the future and plan accordingly.

To download the full article click here

CHICAGO, Nov. 28, 2011 /PRNewswire/ — True Partners Consulting LLC (TPC), the fastest growing tax consulting firm in the nation, announced today the addition of James A. Sadik as a senior manager in its industry-leading National Unclaimed Property Practice…

“Jim is one of the country’s most well-known and respected experts in the field with a long history of fostering a cooperative working relationship with both state regulators and holders of unclaimed property,” said CEO Cary McMillan. “Tight state budgets have led to aggressive auditing and enforcement of unclaimed property laws that allow states to seize property from companies. Jim’s experience working with state regulators and with corporations gives him the perspective of both sides and allows him to steer even the largest Fortune 500 firms through these audits and ensure compliance in the most efficient way possible.”

To read the full article click here.

Minah Hall will present the following session at the Institute for Professionals in Taxation 2011 Credits and Incentives Symposium in Monterey, California

Main Street Stimulus: Best Practices for Improving the Bottom Line

Session Description:
The current economy’s “new normal” has forced companies to reassess their operations and look for untapped opportunities to continue lean, profitable practices. Many companies leave money on the table by failing to negotiate tax and business incentives with state and local governments. In this session, our speakers will focus on the best practices related to credits and incentives from identifying programs, through negotiations and realizing the full value of the benefits.

Conference Description:
Nov. 9 – Nov. 11 – This two and one-half day program provides a comprehensive but focused education on credits and incentives. The program begins with a review of the state of the economy and its role in motivating state credits and incentives programs, current trends and observations, and differing state perspectives. Along the way the program also provides presentations and concentrated discussions on types of incentives, best practices, legislative and judicial developments, “green” credits, audit defense, etc. Audience participation is strongly encouraged and while some working knowledge of credits and incentives is helpful, the program is structured so that all attendees will gain valuable insights regarding credits and incentives.

Download the symposium’s brochure:
2011 CI Symposium Brochure

Nancy Barrett and Don Bast present the real world aspects and applications of sales and use tax by discussing current trends, technology integration, and risk tolerance. The upcoming seminar is in Marlborough, Massachusetts on January 13, 2012. For more information on the seminar, click here.

Oct. 23 – Oct. 25 2011 – Minah Hall will be part of an outstanding program of speakers featuring women from among major site location consulting firms, corporate real estate and economic development who haven been invited to speak about corporate site selection on topics from best practices to advancement as an ED women professional , roundtable sessions and peer networking at this informative B2B conference event. Organized by Area Development magazine’s Consultant’s Forum group the Women in Economic Development Forum is built on the a reputation of a no-nonsense, insightful and strong program where you’ll learn about the latest deciding factors in the site selection process from the best “minds” in site consulting, corporate RE and economic development.

For more information on the forum click here

Les Secular participated as an expert panelist for Financier Worldwide Magazine’s Transfer Pricing Round Table.  The article explores the challenges transfer pricing poses to multinational enterprises and Les Secular’s insights into successfully addressing these issues are quoted extensively .

“Secular: Transfer pricing is, and will remain, a real challenge for multinational corporations (MNCs) of all sizes in times of record deficits. Governments are short of cash and are not receiving it through corporate tax payments as losses abound. Tax authorities are therefore looking to raise cash through: investigating the transfer pricing position, either to increase margins or challenge the method of remuneration, particularly where a cost plus method is applied; and levying penalties for incorrect returns or failure to have adequate transfer pricing documentation. The levying of penalties is the easiest route for tax authorities where resources are limited, as a transfer pricing dispute can be a long drawn out affair, especially where competent authority applies under a double tax treaty, and MNCs should, in theory, only suffer the tax rate arbitrage. Penalties are not subject to competent authority and are a true cost to the group.”

To read the full article click the link below:

Transfer Pricing Round Table

Cary McMillan:  A little luck, and a lot of the right experience

“Cary D. McMillan is chief executive officer of True Partners Consulting LLC, a tax and business advisory firm that has grown since its founding in 2005 to over 200 professionals in 10 locations in the U.S. and eight member firms in Europe and Asia (http://tpctax.com). He was one of several former Arthur Andersen professionals who formed the firm to meet a demand for a tax and advisory firm that was not burdened by potential Sarbanes-Oxley-related conflicts that other firms offering audit services faced. In addition to his corporate directorships that he discusses below, he is a board member of several nonprofit organizations in Chicago, where True Partners is headquartered.”

to read the full article click:  Directors & Boards Profile of Cary McMillan

Allea Newbold and Angela West will present a course titled, “Maximizing the Benefits of Credits and Incentives”

Course Description:
Learn how to maximize the benefits of credits and incentives. Even with states facing economic uncertainty, there are numerous opportunities at the state and local level for tax incentives. The ability to reduce the overall costs of a project has taken on renewed importance. Learn how to recognize the economic factors normally considered to qualify for an incentive, the major types of credit and incentive programs offered and the difference between statutory and negotiated incentives.

Conference Description:
The Annual Conference for Women in Accounting is a joint educational offering of the American Society of Women Accountants (ASWA) and the American Woman’s Society of CPAs (AWSCPA) to provide a program that offers a myriad of opportunities to help professionals meet their continued education goals as well as an opportunity to network with other women of similar backgrounds. The conference runs from October 23, 2011 to October 26, 2011.

For more information on the Annual Conference for Women in Accounting, click here

Acquisition Bolsters Already Strong Accounting for Income Tax Practice

CHICAGO; October 18, 2011 — True Partners Consulting LLC (TPC), the fastest growing tax consulting firm in the nation, announced today that it has purchased Affinity Tax Group LLC, a New York-based firm. This move expands TPC’s strong ASC 740 (formerly FAS 109/FIN 48), tax compliance and state tax service lines. ASC 740 is the set of rules governing how companies report the impact of income taxes on their financial statements.

“The Affinity team brings knowledge and experience in important and complex areas of tax consulting,” said Cary McMillan, the firm’s Chief Executive Officer. “Adding this expertise to our growing New York practice will provide clients the critical support needed during the upcoming tax season.”

The move follows True Partners Consulting’s other expansion efforts during the previous 18 months. During that time, the Chicago-based firm has added offices in Manhattan, Dallas and Denver.

Similar to TPC’s New York practice, Affinity has worked with both public and privately held corporations as well as private equity firms. Federal tax issues are handled by Peter Crocco, who, prior to joining Affinity, spent a decade at Big Four accounting firms, including a rotation with the National Tax Office of PricewaterhouseCoopers LLP in its Mergers & Acquisition Tax Group in Washington, D.C. and New York.

Wayne Trumbull heads Affinity’s State and Local Tax Practice, providing analysis of state tax implications of proposed business reorganizations, analysis of state tax filing for refunds and prospective favorable filing positions and representing clients in state tax controversy matters. Prior to joining Affinity, Wayne had 10 years of experience in the State and Local Tax Practice in the New York Office of Ernst & Young, LLP. Wayne is a member of the New York and Connecticut Bar.

_____________________________________________________________________________

True Partners Consulting LLC
Press Release
October 18, 2011

About True Partners Consulting

True Partners Consulting is a world-class tax and business advisory firm that helps large public and private enterprises navigate complex financial regulations without the Sarbanes-Oxley created conflicts inherent in offering both tax consulting and audit services. The firm provides a broad range of tax compliance services such as tax accounting, implementing tax software solutions and tax return reviews and preparation, as well as tax consulting services, including analysis and counsel concerning the tax impact of business issues such as organic or acquisition-driven growth, filing practices, business restructuring or bankruptcy. The firm also conducts refund reviews, analyzes clients’ tax exposure and prepares responses to audit inquiries, in addition to helping clients address compliance issues.

The firm has offices in Chicago; New York; Los Angeles; San Jose, Calif.; Tampa Bay, Fla.; Dallas, Denver, Boston; and London. There are also member firms in Beijing and Shanghai, China; Frankfurt, Munich, and Stuttgart, Germany; Hong Kong; Turin, Italy; Selangor, Malaysia; Amsterdam, The Netherlands; Poznań, Warsaw, and Wroclaw, Poland; Singapore; Seoul, South Korea; and Barcelona, Spain, , through the True Partners Consulting International network. Additional information can be found at http://www.tpctax.com.

True Partners Consulting

As an expert in the tax field, True Partners Consulting is available to provide content expertise regarding:
• Federal Tax
• State and Local Tax
• International Tax
• Property Tax
• Sales and Use Tax
• Unclaimed Property
• Transfer Pricing

Gemma Urquiza, Eduardo Castrejon, and Cary McMillan are featured in Reuter’s article, “Accounting can be door to U.S. professional class”. Gemma’s experiences lead off the article. Cary is quoted speaking of True Partners Consulting’s efforts to recruit first-generation Americans as an important effort to hire the best talent. Finally, Eduardo’s quote on the professional recognition of being an accountant concludes the article.

WASHINGTON, Oct 16 (Reuters) – When Gemma Urquiza interviewed for her job at True Partners, a Chicago tax and consulting firm, she remembers talking about her university honors, her ambitions and her dad’s restaurant.

Urquiza, 25, is the eldest of four children of Mexican immigrants and, like many first-generation Americans, she’s found accounting to be a perfect fit.

Her employer likes her work ethic and multicultural upbringing, as well as her technical mastery and spreadsheet savvy. She likes the variety of the job and its stability.

Accounting has long provided a path for first-generation Americans into the professional classes. Good pay and a focus on numbers makes it an attractive career choice.

To read the full article, click here

WEDNESDAY, NOVEMBER 16, 2011
9:00 A.M. TO 3:30 P.M.
HYATT REGENCY SANTA CLARA
5101 Great America Parkway
Santa Clara, California
Directions

Please join us for this practical workshop co-sponsored by DLA Piper and True Partners. We will discuss examples of the following hot topics and industry trends:

• Accounting for income taxes
• International tax structures
• Tax audits
• Research and development
• Tax updates

AGENDA:
9:00 a.m. – 9:30 a.m.	Registration and continental breakfast
9:30 a.m. – 12:30 p.m.	Welcome and presentation
12:30 p.m. – 1:30 p.m.	Lunch
1:30 p.m. – 3:30 p.m.	Conclusion and questions

4 CPE credits
(CPE credits will be provided by True Partners Consulting)

To Register for the seminar Click here

Cost $125 per person
(make checks payable to True Partners Consulting)

For more information contact Tara Herrera at tara.herrera@tpctax.com.

Contact True Partners Consulting’s Property Tax Assistance Hotline to be immediately connected to our team of expert property tax consultants.  True Partners Consulting can efficiently and effectively address your property tax concerns.

Call toll-free:
Property Tax Assistance Hotline: (877) 403-7746
Monday – Friday, 9:00 am – 4:00 pm
or E-Mail us at Residential.Appeals@TPCtax.com

BRISTOL, Va. — Olive Garden will join a spate of other new national chain restaurants scheduled to open near Interstate 81’s Exit 7….

“The Red Lobster has been doing well and when one concept does well, they [Darden] begin looking at expanding to the other concept – the Olive Garden,” Newbold said. “When they look at an area, they evaluate it for a number of years.”

To read the entire story, click here

Relationship-building Key for CFOs Seeking Operational Experience

Chief financial officers wanting to move higher up in the C-suite should look for opportunities to build relationships with their firm’s customers, and sales and marketing teams, according to Cary McMillan, former CFO of Sara Lee. McMillan eventually moved on to become CEO of one of the manufacturer’s units and later started his own company.

To read the full article, click here.

ON THE MOVE: Property tax expert Myer Blank has joined True Partners Consulting LLC as senior manager. He had been executive director of the Chicago Tax Assistance Center, the City Hall agency that helps people understand their property taxes. The office faces the axe under Mayor Rahm Emanuel.

To read the full article, click here.

Firm expanding property tax relief services as clients face difficult economic times, complex appeals process

CHICAGO; September 20, 2011 – True Partners Consulting (TPC), fastest growing tax consulting firm in the nation, has hired Myer Blank as a Senior Manager in the firm’s property tax practice. Mr. Blank will help business and residential clients navigate the complex assessment, payment, and refund processes for the purpose of reducing their property taxes. He will join James Kane and Dorothy Radicevich and the National Property Tax Consulting team headquartered in the firm’s Chicago office.

“Myer Blank brings a wealth of experience regarding property tax policy and procedures,” said Cary McMillan, the firm’s Chief Executive Officer. “With the downturn in the economy, businesses and residential taxpayers are looking to decrease their expenses, and local property taxes are one of their biggest concerns.”

In 2001, Mr. Blank was named the Chicago Tax Assistance Center’s (CTAC) first executive director. He held that position until recently. CTAC, a City of Chicago service center, assists homeowners with property tax appeals, exemptions and refunds. Prior to that, Blank was director of policy analysis for The Civic Federation, a local taxpayer watchdog group.

“True Partners Consulting is well-positioned to address the changing property tax environment, specifically the decline in property values,” said Mr. Blank. “While many property values are decreasing during the recession, taxpayers face the challenge of securing correct valuations and lowering their taxes.”

– True Partners Consulting (TPC), fastest growing tax consulting firm in the nation, has hired Myer Blank as a Senior Manager in the firm’s property tax practice. Mr. Blank will help business and residential clients navigate the complex assessment, payment, and refund processes for the purpose of reducing their property taxes. He will join James Kane and Dorothy Radicevich and the National Property Tax Consulting team headquartered in the firm’s Chicago office.

 True Partners Consulting is a world-class tax and business advisory firm that helps large public and private enterprises navigate complex financial regulations without the Sarbanes-Oxley created conflicts inherent in offering both tax consulting and audit services. The firm provides a broad range of services, including analysis and counsel concerning the tax impact of business issues such as organic or acquisition-driven growth, filing practices, business restructuring or bankruptcy. The firm also conducts refund reviews, analyzes clients’ tax exposure and prepares responses to audit inquiries, in addition to helping clients address compliance issues.

The firm has offices in Chicago; New York; Los Angeles; San Jose, Calif.; Tampa Bay, Fla.; Boston; and London. There are also member firms in Paris; Turin, Italy; Barcelona, Spain; and Beijing, China; through the True Partners Consulting International network. Find additional information at tpctax.com.

On Monday, August 15, 2011, Illinois Governor Pat Quinn signed into law House Bill 1560, which shortens the dormancy period for “unclaimed wages, payroll, and salary, in any form” from five years to one year.  The bill included language providing that the new legislation is effective immediately.

Click here to download full PDF

By Anne Szustek
August 9, 2011

The Ways and Means Committee, the tax-writing body in the US House of Representatives, debated whether to institute a nationwide consumption tax during a panel on July 26.

Even though questions surrounding the US debt ceiling have been set aside for the time being, the utility and feasibility of such a tax is still a point of deliberation.

The Fair Tax Act would get rid of federal income, payroll, estate and gift taxes in favour of a retail tax that would be applied equally across the 50 states. States would also be charged with collecting these taxes and paying them to the US Treasury.

The retail tax would not exactly be a VAT, but it would bear some similarities. Rather than taxing each stage of a given item’s production costs, it would simply be a blanket 23% sales tax. The Bill also includes a provision for a monthly rebate payment to US residents up to the poverty level. After 2015, a Sales Tax Bureau and Excise Tax Bureau would be established in lieu of the Internal Revenue Service (IRS), with the former handling the new nationwide consumption tax and the latter administering any taxes that would have been under the auspices of the IRS.

This Bill repeatedly has been up before Congress. Should it pass before Congress adjourns in December it may take several years before anything would be instituted.

“There are a lot of challenges for [a nationwide consumption tax] to happen,” said Tracey Sellers, managing partner at True Partners’ Tampa office. “There’s a lot to be hammered out, in terms of government authorities understanding how it would be instituted, and special interest groups pursuing their cause.”

The Bill’s proposed timeline still might not offer relief soon enough, said Anthony Lacoudre, international tax director at accountancy firm WeiserMazars, who sees a VAT as an effective tool to combat the nation’s debt crisis.

“As far as the timeframe is concerned, many experts believe that the US will default in the course of 2012 or 2013, so the sooner a VAT is introduced, the better,” he said.

“As far as a tax increase is concerned, implementing a federal VAT in the near future looks quite plausible to me. Direct taxes in the US are already at a very high level, especially when compared to Europe and I don’t see too much room for substantial direct tax increases in the US,” he added.

“On the contrary, the US does not tax consumption as highly as they do in Europe, which means that there is clearly some room for indirect tax increases in the US.”

Unlike in Europe, individual states in the US each have their own sales tax, which they would likely be loath to adjust. For example, Florida has no personal income tax and relies on general state sales taxes for 70% of the state’s income.

Given that Canada and the US have similar structures in terms of provincial- and state-level taxation, the US’ neighbour to the north was suggested as a potential model for a nationwide consumption-based tax, should the US decide to pursue it.

________________________________________________________________________________________

For more information, contact Tracey Sellers
Tracey.Sellers@TPCtax.com
(813) 434-4004

July 25, 2011 – True Partners Consulting was recently named one of Florida’s Best Companies To Work For.

One-hundred companies were recognized in small, medium and large company categories. The rankings – the third annual statewide Best Companies list – appear in the August issue of Florida Trend and on FloridaTrend.com.

The Best Companies To Work For in Florida program was created by Florida Trend and Best Companies Group and endorsed by the HR Florida State Council.

“Companies that retain the best employees with strong workplace programs typically stand out from the crowd by offering exceptional customer focus from a friendly, upbeat staff,” says Florida Trend Publisher Andrew Corty.  “It’s our pleasure to recognize these great organizations and encourage others to join them in building Florida’s competitive advantage.”

To be considered for participation, companies or government entities had to employ at least 15 workers in Florida and be at least a year old.

Companies that chose to participate in the Best Companies To Work For in Florida process underwent a two-part survey process. The first part consisted of evaluating each company’s workplace policies, practices, philosophy, systems and demographics. The second part consisted of an employee survey to measure employee satisfaction. The combined scores determined the top companies and the final ranking. Best Companies Group managed the overall registration, survey and analysis process and determined the final rankings. Companies were not required to pay a participation fee to go through the online assessment process.

“One strong theme in this month’s Best Companies coverage is how companies keep good employees. We highlight companies that take sophisticated, enlightened approaches to training, communicate the company’s values clearly, and listen to employees as they try to improve the workplace and make the company more productive.” says Mark Howard, executive editor.

For a complete list of the 100 Best Companies to Work For in Florida, go to www.FloridaTrend.com/BestCompanies

About Florida Trend

Florida Trend magazine provides excellent, forward-looking, and in-depth reporting on business, finance and public policy in Florida. Florida Trend reaches more than 250,000 business executives, government officials and civic leaders. In addition, the magazine’s website reaches approximately 80,000 unique visitors monthly. For more information, please visit www.FloridaTrend.com.

About Best Companies Group

Best Companies Group works with national and local partners around the country and in Canada to establish and manage “Best Places to Work,” “Best Companies,” and “Best Employers” programs on a national, statewide and regional basis. Through its thorough workplace assessment, utilizing employer questionnaires and employee-satisfaction surveys, BCG identifies and recognizes companies that have been successful in creating and maintaining workplace excellence. For more information, please visit www.BestCompaniesGroup.com.

John Cummings July 5th, 2011

Commercial property values in most parts of the country have seen a precipitous decline since the market peaked in 2007. The latest figures from Moody’s, released last week, show a 3.7 percent fall in actual transaction prices in April, bringing the firm’s national all-property aggregate index down to around 50 percent of its value at the peak. That’s the lowest point since the company started tracking the data in 2000. (Real estate consulting firm Real Capital Analytics offers the full Moody’s report here in pdf form.)
 
The news is not all bad; Moody’s sees strong signs of recovery in major markets such as San Francisco, New York, and Washington. And transaction volume nationwide is on the increase — a very good sign for a potential broad recovery.
 
The other silver lining in all this, of course, is the opportunity for companies to press for lower property taxes. After all, taxes steadily increased when the market was booming — why shouldn’t they go down now that property prices have declined?
 
A lot of businesses are thinking along those lines, according to Jim Kane, managing partner at tax and business advisory firm True Partners Consulting. But many are missing out simply because their tax departments are too disorganized to seize the opportunity. Most organizations don’t have a dedicated property tax function, so the responsibility falls on whoever in the finance or tax departments has the available time at any given moment.
 
“It’s common for a company to simply track property tax bills as they arrive in the mail and pay them as long as they don’t increase ‘significantly,’ Kane notes. “Bills get ignored and significant penalties and interest are paid because a proper property tax function is not in place.”
 
Effective software support is often lacking, he adds. While some larger corporations use property tax software programs such as PTMS (Property Tax Management System), they don’t always have the personnel to administer the system and populate it with accurate and timely information. In addition, beyond the basic features, “most companies don’t fully utilize the features of property tax software appropriately.”
 
So is it worth the effort to go up against the assessors? “The short answer is yes,” says Kane. “Taxpayers should always inspect property records and keep in contact with assessors. Oftentimes, an assessor is not aware of significant changes to a business or property until it’s too late. Keeping the assessor informed through informal discussions can help avoid significant effort down the road, when the cost-benefit analysis to appealing a property may discourage an appeal.”
 
Something to keep in mind while commercial property prices are still scrabbling around trying to find a bottom.

By Tammy Whitehouse
July 6, 2011

Deficit-laden state governments are increasingly eying unclaimed property and are putting more pressure on companies to turn over abandoned assets.

They are also taking a broader view of what constitutes unclaimed property meaning companies must assess their risks and brush-up their compliance efforts on that point.

Recent, high-profile actions by states involving corporate giants like John Hancock, McKesson, and Staples have made clear that state governments are more aggressive than ever in collecting unclaimed property, says Noel Hall, principal and leader of the abandoned and unclaimed property practice at tax firm Ryan. “These audits are unlike anything I’ve seen in 30 years of doing this,” he says. “I’ve sat in on some of the conference calls with auditors and in some cases it’s clear that it’s a fishing expedition.”

States have held authority over abandoned or unclaimed property since the 1960s, collecting it from corporations or other institutions when it is left unclaimed by its rightful owners. Unclaimed property has long included items such as abandoned bank accounts, uncashed checks, traveler’s checks, stocks, bonds, trust distributions, utility or rent deposits, insurance policies, refunds, and other orphaned assets. The National Association of Unclaimed Property Administrators says state treasurers are sitting on nearly $33 billion in unclaimed funds, waiting for the rightful owners to stake their claim. States pursue unclaimed property to prop up their general funds because they rarely reunite much of that property with the rightful owners. Technically states are the custodians of those unclaimed assets, not the owners, but the low claim rate on such funds makes them a sweet source of revenue without raising new taxes.

It’s no secret that state governments are strapped for cash and looking for revenue, especially in ways that don’t involve raising taxes, says Marc Musyl, a partner with law firm Greenberg Traurig. For fiscal 2012, the combined deficit for 42 states with budget shortfalls and the District of Columbia is expected to be $103 billion, according to the think-tank Center on Budget and Policy Priorities. “States are becoming more aggressive in looking for as broad a definition of abandoned property as they can come up with,” Musyl says. “And they’re looking for ways to recover that as efficiently as they can.”

Actions against Hancock, McKesson, and Staples illustrate the new direction, experts say. In the case of Hancock, for example, California unleashed a third-party audit firm working on a contingent-fee basis to search for unclaimed property. Ultimately, Hancock relinquished $20 million in undelivered death benefits and matured annuities owed to Hancock clients, says Cathleen Bucholtz, managing director of tax firm True Partners Consulting.

“Because they settled, a lot of the particulars will never be known,” she says. “Historically, banks and insurance companies were thought to be in substantial compliance. If a state is going to go after a company that has historically filed its unclaimed property, it will certainly go after companies that they know are non-compliant.”

The Hancock settlement has set off deeper investigations of major insurers, says Mary Jane Wilson-Bilik, a partner with law firm Sutherland Asbill & Brennan. States are sending in not just unclaimed property auditors but also insurance commissioners and other enforcement agencies to search for further market conduct problems. “I’ve never seen this before,” she says. “This is very unprecedented.”

The case against Staples, which has been working its way through the Delaware courts for a few years, boiled over recently, Hall says, when Staples fought back against the state’s assertions that it could estimate unclaimed property liability if records were missing. The company and the state’s auditor are sure to come up with different numbers when estimating such a liability, he says, especially if the state’s auditor is paid on contingency.

Outside the Boundaries

Some disputes are arising over what constitutes unclaimed property, as states attempt to broaden the definition. For example, in a case against McKesson, Delaware has asserted unclaimed property rights over mismatches between inventory received and amounts paid for inventory, prompting McKesson to fight back, says Sarah Niemiec Seedig, a lawyer with Greenberg Traurig. In this case, the state is targeting complementary drug samples. “These are items not traditionally considered unclaimed property,” she says.

In addition to traditional general ledger searches, states also are examining securities transactions, says Diane Zumoff, chief compliance officer at unclaimed property advisory firm Keane. The states’ third-party auditors are looking for any stock-related assets, including common stock, preferred stock, restricted stock, unexchanged or unredeemed proceeds resulting from mergers and acquisitions, and others, she says. “These are broad information requests,” she says. “The volume of information requested and the type of requests are falling way outside the typical boundaries of unclaimed property audits.”

The overarching messages for companies in all sectors is to broaden the view of what falls into the category of unclaimed property and shore up any gaps in compliance, experts say.

Companies need to take stock of their risk and consider entering states’ voluntary disclosure programs, Zumoff says. “There’s a lot of work to be done,” she says. “Most companies are very decentralized in terms of their unclaimed property shop. Typically the new kid on the block gets unclaimed property as his or her job, and there’s a lot of turnover, so the intellectual capital is not really maintained as well as it should be.”

What’s more, companies generally do a poor job at complying with unclaimed property regulations. Hall said industry estimates suggest about 20 to 25 percent of companies are generally compliant with unclaimed property reporting requirements. That leaves plenty of room for improvement, especially among companies that are diligent about reporting one or a few predominant areas of unclaimed property but are overlooking other areas. In Hall’s view, the most vulnerable companies are those in the Fortune 1000 and those incorporated in or doing substantial business in the most aggressive states, such as Delaware and California.

Musyl says companies need to get up to speed on the kinds of unclaimed property states are pursuing, and consider whether they might be at risk. Most companies are aware to watch for uncashed checks, abandoned deposits, dormant accounts, even unused gift cards or prepaid cards or unclaimed layaways, but the net can be much wider.

Marlys Bergstrom, also a partner with Sutherland Asbill & Brennan, says companies that are in the bad habit of writing off outstanding checks or credit balances should adopt some new procedures. “If you’re writing off outstanding checks, that’s immediately a bad sign,” she says. She is advising companies to get their arms around all possible sources of unclaimed property, assess procedures, and determine if a voluntary disclosure program might be a good option. With unclaimed property subject to no statute of limitations, and states showing interest in estimating and extrapolating, the liabilities can become daunting, she says.

Hall warns companies to tread cautiously into voluntary disclosure programs. “I wouldn’t advise anyone to just put some numbers on a form and turn it in,” he says. Staples, after all, began its present dispute with Delaware by entering a voluntary disclosure program, he says.

In one extreme case, a state auditor targeted unredeemed points earned on an Internet gaming site, Musyl says. “As you might imagine, the folks who play these games are hard to identify and find,” he says. “But if someone wins points that are redeemable for tangible property, that’s going to be a hot area of concern for states that are looking to generate additional revenue.”

As states continue to push the bounds of what constitutes unclaimed property, companies will increasingly have to decide to turn over the goods, or fight back. Another possible strategy: Do more to find the rightful owner in the first place.

–Energy companies in the U.S. would face biggest tax hit if “last-in, first- out” inventory accounting method is repealed
 
–Republicans criticize White House support for repealing LIFO practice
 
–Exxon Mobil has largest LIFO reserve of more than $25 billion
 
By Kristina Peterson
 
Of DOW JONES NEWSWIRES
 
WASHINGTON -(Dow Jones)- Oil and gas companies in the U.S. would take the biggest hit if Congress repeals an inventory accounting method that, for decades, has helped firms show slimmer profits and pay lower taxes.
 
As contentious negotiations over how to raise the federal government’s $14.29 trillion debt ceiling continue, Republicans lawmakers this week sharply criticized the White House for wanting to repeal the “last-in, first-out,” or LIFO, accounting method in order to raise revenue. The Joint Committee on Taxation, a nonpartisan Congressional research office, has estimated that repealing the method would generate new revenue of nearly $70 billion over 10 years, but the GOP charged that such a move could cripple struggling manufacturers.
 
Senate Minority Leader Mitch McConnell (R., Ky.) criticized the idea on the Senate floor Wednesday and opposition from other Republican lawmakers will likely pose a steep hurdle to repealing the accounting method as part of the deficit talks.
 
“Let me get this straight–our economy is fragile, millions of Americans are out of work, and this White House is actually proposing an idea that would make things worse for our manufacturers,” Sen. Orrin Hatch of Utah, the top Republican on the Senate Finance Committee, said Tuesday.
 
The six companies with the largest LIFO reserves are energy companies, led by Exxon Mobil Corp. (XOM) with a reserve of more than $25 billion, according to a survey of publicly traded companies published in the January 2010 issue of the Journal of Finance and Accountancy. The proposal comes as large oil and gas companies already face attacks in Congress to reduce their tax benefits, with lawmakers targeting a popular deduction for manufacturing activity and a credit for oil companies that pay taxes to foreign governments.
 
Under LIFO, companies can value the cost of the goods they have sold at their most-recent prices, while their inventories are valued at older prices. The method assumes that the last items bought are the first ones sold. If prices are rising, this means a company’s recorded costs will be higher and its taxable income will be smaller.
 
This is a particular boon for energy companies during a period when oil prices have jumped 26% over the past five years and soared over the last two decades. On Tuesday, oil closed at nearly $93 a barrel on the New York Mercantile Exchange; in June 1996, oil traded at close to $20 a barrel.
 
“There hasn’t been another industry where inflation has really taken over the way it has in the oil and gas industry,” said Robert M. Gordon, managing director of tax-advisory firm True Partners Consulting and a former assistant general tax counsel at BP PLC’s (BP, BP.LN) BP America unit.
 
Under the proposal President Barack Obama offered in his fiscal year 2012 budget, companies would have to switch to a “first-in, first-out,” or FIFO, accounting method that would generally make the cost of goods sold smaller, resulting in a higher taxable income. Companies that have been using the LIFO method would also have to pay taxes over a 10-year period on their cumulative ” LIFO reserve,” an accounting entry that reflects the difference between the two accounting methods.
 
Energy companies had the six biggest–and nine of the 20 largest–LIFO reserves as of October 2008, according to the study, which culled data from 9, 917 actively traded companies. After Exxon, Chevron Corp. (CVX) had the second- largest reserve at just under $7 billion, followed by ConocoPhillips (COP) at $ 6.7 billion. Heavy equipment-maker Caterpillar Inc. (CAT) had the biggest LIFO reserve of any non-energy company–and seventh-largest in size–at $2.6 billion.
 
Being able to keep their expenses high and income low has helped oil companies to take political shelter when prices at the pump angered the public, one of the study’s authors, Reed Roig, assistant professor of accounting at the University of North Carolina at Asheville, said in an interview.
 
“When gas prices go up and everybody’s yelling about windfall profits, ‘last- in, first-out’ dampens that effect,” Roig said.
 
Energy companies’ embrace of LIFO accounting is far from new. Congress authorized companies to use LIFO for income-tax purposes in 1939 and, by 1953, petroleum and coal products had the highest LIFO ratio–a measure of the LIFO- calculated value against the total book value–of any industry, according to the Survey of Current Business, a Commerce Department report.
 
Repealing the LIFO method would “generate a very substantial tax bill” for the energy industry, said Stephen Comstock, manager of tax policy at the American Petroleum Institute, the main lobbying group for the oil and gas industry. Oil refiners would see a bigger impact than exploration and production companies, he noted.
 
On Tuesday, Republican lawmakers cautioned that increasing taxes for oil and gas companies could result in higher gasoline prices.
 
-By Kristina Peterson, Dow Jones Newswires; 347-882-7215; kristina.peterson@ dowjones.com
 
–Jerry DiColo contributed to this article.

Amazon’s refusal to collect California sales tax won’t be official until an Oct. 1 deadline
By Marc Lifsher and Andrea Chang
July 2, 2011

Amazon.com Inc. is sticking by its vow not to collect California sales tax on Internet purchases — and state officials must decide what to do about it.

But the showdown over the new tax collection law that took effect Friday could be months away. Companies don’t send the taxes to the state until the end of each quarter, which means the California Board of Equalization won’t know officially about Amazon’s refusal to collect them until Oct. 1.

The tax-collecting agency said Amazon accounts for about half the Internet sales in California from large out-of-state firms that, prior to the new law, did not have to collect sales tax for the state. It said the new law would capture about $317 million a year in sales taxes that previously went uncollected.

Amazon, based in Seattle, has said repeatedly that it would not collect the California sales tax, calling it an unconstitutional infringement on interstate commerce.

Such defiance sets up a major legal battle by this fall, though Amazon could first challenge the law in court, as it has in New York. It has lost a trial court ruling there and has an appeal pending.

Amazon is “going to fight in every state where it can fight,” said Tracey G. Sellers, managing director of the Tampa, Fla., office of tax firm True Partners Consulting. “It’s going to be years before this whole issue is settled” in the courts.

Amazon declined to say whether it would sue to overturn the new California statute, though state officials expect a lawsuit.

Experts have mixed opinions about how possible or pending legal challenges might turn out in California and at least seven other states with tax collection laws covering online sales.

“Barring a change in federal law, California has no chance,” said Steve Gill, a professor of taxation at San Diego State University. “There’s literally nothing they can do. The tax law is and has been pretty darn clear on this issue for decades.”

Gill said that a change in sales tax rules at the federal level would need to be hammered out in order for Amazon to comply, but that Congress has “no real appetite” to tackle the issue.

“In my view, California played their hand, and Amazon called their bluff,” he said.

Before suing California, Gill said, Amazon might wait for its New York case to play out. That suit could go to the U.S. Supreme Court, he said, “and then we’ll have a definitive answer.”

John Swain, a state and local taxation law expert at the University of Arizona, argued that California has a good shot at success.

“The smart money is behind the California taxing authority,” he said, if the state’s lawyers can establish that Amazon physically does business here.

The law affects about 2,000 out-of-state Internet companies that have established some business relationships here — workers, partners, offices or other operations.

If Amazon has such connections in California, then it has a “serious problem,” Swain said.

Amazon moved quickly Wednesday to get rid of its connections to the state by axing about 10,000 California affiliates that were paid commissions for funneling business to Amazon through their websites.

The company still has separate business operations in the state, including a laboratory that develops Kindle e-readers in the Silicon Valley, but declined to disclose what, if anything, it planned to do with them.

The new law also gives the Board of Equalization the authority to develop new theories that would establish a nexus or legal connection, making Amazon liable for collecting California sales taxes.

“This swings the gate wide open to establish nexus as we see fit,” said Betty Yee, a board member who spearheaded the agency’s support for the law. But she acknowledged that any other theories the board devises would probably be tested in court.

The difficulty in enacting state laws on tax collection stems from efforts to comply with a 1992 U.S. Supreme Court ruling that a state can require out-of-state companies to collect sales taxes only if those companies have some physical presence in the state.

Internet retailers with no bricks-and-mortar presence in the state said the ability to sell without adding sales taxes helps them offer lower rates, operate on a smaller profit margin and attract and keep customers who otherwise might simply shop at the nearest store.

Gov. Jerry Brown, who signed the measure into law Wednesday, saw an extra $317million in sales taxes annually as a way to help shore up a battered state budget. Brown and local businesses also said that it’s only fair to require Internet companies to do the same thing that bricks-and-mortar shops have been doing.

Even some former Amazon affiliates, such as Tim Ware of Oakland, who owns a Web design and development firm, agreed.

“If people are going to buy books, they can either go to the bookstore in their town or they can go to Amazon. I think either way, they should pay sales tax because it’s unfair competition for local booksellers,” Ware said.

“When you boot up your computer and click on Amazon,” he said, “they are in your state; they are in your room.”

Cook County Assessor Joseph Berrios joined the Chicagoland Chamber of Commerce Taxation Committee at its June 28 meeting to discuss his plans for improving the office and other important initiatives for 2011.

To view the full article click here.

THURSDAY, JUNE 9, 2011
9:00 A.M. TO 3:30 P.M.
HYATT REGENCY SANTA CLARA
5101 Great America Parkway
Santa Clara, California

A practical workshop with examples and discussions of the following hot topics and industry trends:

• Forecasting
• Modeling annual estimated ETR
• Discrete events
• Completing Form UTP, with an example
• Tax law changes impacting 2010 tax returns

AGENDA:

9:00 a.m. – 9:30 a.m. Registration and Continental Breakfast
9:30 a.m. – 12:30 p.m. Welcome and Introduction
12:30 a.m. – 1:30 p.m. Lunch
1:30 p.m. – 3:30 p.m. Conclusion and Questions

To Register for the seminar Click here

4 CPE credits
(CPE credits will be provided by True Partners Consulting)

Cost $125 per person (make checks payable to True Partners Consulting.

Laurie Kulikowski
January 24, 2011
To view this article online Click Here

Location, location, location. It’s the mantra real estate agents live by, but can also be vital for small businesses.

States differ wildly on various tax and business-specific programs that can make or break a business, especially a small start-up.

Whether it’s because of the startlingly high numbers of workers out of jobs or just a tactic to bring revenue to suffering state fiscal budgets, many states are increasingly courting small businesses and start-ups. The conventional wisdom says small businesses create two-thirds all jobs.

“The climate for a start-up almost anywhere frankly is about as positive as I have ever seen it,” says Dr. Charles “Chuck” Morrissey, an associate professor at Pepperdine University’s Graziadio School of Business and Management.

In Rhode Island, for instance, state Rep. Donna Walsh (D-36), who is on the state’s House Committee on Small Business, introduced a bill Jan. 19 to eliminate the corporate tax for many small businesses.

The legislation would eliminate Rhode Island’s minimum corporate tax, now $500 for firms grossing less than $250,000 annually, and set up a graduated tax system based on gross receipts. “Besides equity, its greatest benefit is to provide tax relief for small businesses and start-ups to whom every dollar counts,” Walsh said in a statement.

Ideally for small businesses, states could compete to be known to be as welcoming to them as Delaware is to larger firms. Delaware claims to be where more than 50% of all U.S. publicly-traded companies and 60% of Fortune 500 companies are incorporated.

The state is pro-business and shareholder friendly, with modern corporation statutes and well-developed case law that facilitates business planning; a helpful state legislature; and a non-juried Court of Chancery dealing specifically with corporate issues.

“Once firms get beyond $20 million to $25 million in annual revenue, they should consider changing to a corporation,” says Mariano Sori, a state taxation expert at True Partners, “but small businesses that intend to expand can also take advantage of the environment.”

Morrissey, who led Pepperdine B-school’s entrepreneurship program, notes that many student business plan lack “location strategy,” which could be detrimental to a start-up’s success.
“In many cases the business models assumed they would be in a location that would be [start-up] friendly,” which isn’t always the case, Morrissey says.

“It’s no coincidence that the Apples and Googles just happen to come from very few areas,” he says.

TheStreet is highlighting the five best and worst states for small businesses as compiled by the Small Business & Entrepreneur Council as part of its annual Small Business Survival Index, released in December.

The index ranks states by their public policy climates for small business and entrepreneurship, measuring the costs and burdens of state government on small business and looking at policy areas that enable competitiveness and growth.

Low labor costs and a lack of corporate income tax are common denominators in the best states, while the opposite is true for some of the worst states, experts say.

“A lot of states have instituted programs for small businesses, or even large businesses, that want to relocate to the state,” Sori says, citing grants, tax credits and temporary property tax reductions. When entrepreneurs can choose where to base a business, things to look at include corporate income tax rate, property tax and the sales tax burden.

The top and bottom five, according to the council:

The fifth-best: Washington
The only state named after a president is home to a number of well-known corporations including Microsoft, Boeing, Starbucks and Costco, but it has plenty to offer small businesses.

Washingtonians and their businesses enjoy a lack of taxes for personal income, individual income, corporate income and corporate capital gains. It also boasts low electric utility costs, according to the SBE Council’s report.

That being said, Washington has high unemployment taxes, “very high” consumption-based taxes, a large number of health insurance mandates and a high state minimum wage.

Yet Washington has a renewed focus toward business, particularly small businesses. Democratic Gov. Chris Gregoire signed an executive order in October to facilitate small-business recovery in her state.

Among other things, the order directs state departments to “review current practices, tax and rate structures with the goal of reducing state imposed costs for small businesses,” as well as find ways to reduce the complexity of the state’s sales tax system.

“I want our business owners spending less time understanding what tax rate they should pay and more time ensuring their business succeeds,” Gregoire said in a statement.
Additionally, Gregoire is looking to consolidate small-business licensing, registration and certification guides into one resource and develop strategies to streamline regulatory processes.

Fourth-best: Wyoming
Home to Yellowstone National Park and Grand Teton National Park, Wyoming also boasts no tax on personal income, individual capital gains, corporate income, corporate capital gains or estates.

It also has the lowest electric utility costs, and very low gas and diesel taxes, according to the SBE Council.

On the other hand, Wyoming has high property, consumption-based and unemployment rates, as well as high workers’ compensation costs.

Wyoming’s new governor, Republican Matt Mead, owns farming and ranch operations in the state and is considered likely to make job and small-business measures a priority while in office.

Third-best: Texas
The Lone Star State has no taxes related to personal income, individual capital gains, corporate income, corporate capital gains or estates. Texas also boasts a low level of state and local government spending and low workers’ compensation costs, the SBE Council says.
The state does have high property and consumption-based taxes, as well as a large number of health insurance mandates and a very high crime rate, the council notes.

According to the website of Republican Gov. Rick Perry, Texas has brought in more jobs than any other state in the past 10 years.

Texas boasts a business-friendly atmosphere, particularly for start-up technology firms, including the Texas Enterprise Fund, which functions as a “deal closing” fund to enable the state to compete “directly with incentives offered” in other states, and the Emerging Technology Fund, which helps early stage tech firms as they get their footing, the website says.

Beginning in October, Perry’s office has hosted 14 “Small Business Forums” across the state offering business owners access to information on work force development, training grants, expanding markets and other business growth opportunities.

Second-best: Nevada
It’s understood that “what happens in Vegas, stays in Vegas,” but small-business owners will be happy to know the state also doesn’t want them leaving.

Nevada does not tax personal income, individual corporate gains, corporate income or corporate capital gains. It also has no death taxes and low workers’ compensation costs, according to the council report.

On the downside, Nevada does have high consumption-based taxes, high unemployment taxes and a high state minimum wage.

It is among states hardest-hit by the housing crisis and unemployment — topping 14.5%, according to a Friday press release from the governor’s office.

Bringing in jobs will be a high priority for the state’s new governor, Republican Brian Sandoval.

“We cannot burden struggling businesses with tax increases … We must allow sunsetting taxes to expire at the end of June and provide businesses the environment in which to begin hiring again,” he said Friday, referring to a tax package passed in 2009 that included temporary reductions to payroll taxes for small businesses, among other measures. The package is set to expire June 30.

He is expected to release his budget today.

Best: South Dakota
The top small-business-friendly state is South Dakota, which boasts, like some of the other top states, no taxes on personal income, individual capital gains, corporate income, corporate capital gains or estate transfers.

The state, home to historical Mount Rushmore, also has the lowest crime rate, a low level of state and local government spending and a low number of health insurance mandates, the SBE Council reports.

Gov. Dennis Daugaard is saddled with the task of fixing the state’s budget as he takes office this month. He has said he is opposed to raising taxes, instead preferring spending cuts.

Daugaard, a Republican, plans to spur economic growth in the state by fostering innovation and encouraging business in high-tax states to move to South Dakota and businesses already in South Dakota to “increase their production and the number of people they employ,” he said in his State of State Address two weeks ago.

He also said he plans to move money into the $10 million Revolving Economic Development Initiative Fund and revamp the state’s “bureaucratic” microloan program for small businesses, among other measures.

“We have the best business climate in the nation, and I intend to keep it that way. Our first advantage is our low tax burden,” Daugaard says.

Fifth-worst: Vermont
Vermont is among the list of states with high taxes on personal and corporate income, as well as high taxes on individual and corporate capital gains. The state also has high property taxes, high electric utility costs and high workers’ compensation costs, according to the SBE Council’s report, as well as poor private property protections.

On the flip side, the Green Mountain state has very low crime and no individual or corporate alternative minimum tax, SBE Council says.

That being said, Vermont’s new governor, Democrat Peter Shumlin, a small-business owner himself, pledged to create jobs and relieve taxpayers of the high burden of state taxes.

In his inaugural address this month, Shumlin put forth an aggressive agenda in which fostering entrepreneurship and combating the high cost of health care were priorities.

“Finally, my jobs agenda will expand the ability of emerging enterprises and businesses to access capital and credit when they need it the most,” Shumlin stated in his speech. “If our Green Mountain State can be recognized by young entrepreneurs as the innovative leader in financing and venture capital for micro-businesses when banks say ‘no,’ small businesses will thrive.”

Shumlin identified one possibility: taking advantage of the federal EB-5 Immigrant Investor program for venture capital.

Fourth-worst: California
California has high personal and corporate income taxes as well as high taxes on individual and corporate capital gains. And the list goes on. According to the SBE Council, California has the highest gas and diesel taxes, an additional tax for S-corporations, an added estate tax, poor private property protections, a large number of health insurance mandates and high workers’ compensation costs.

California is suffering a $28 billion fiscal deficit and has the worst credit rating among the 50 states, according to new Gov. Jerry Brown, a Democrat who also led the state in the 1970s and early ’80s. The Golden State has one of the highest unemployment rates in the country — 12.4% as of November, according to the Department of Labor. Thousands of Californians face foreclosure on their homes as a result of the housing bust.

Brown proposes a $12.5 billion cut to California’s state budget to close a large deficit and is reconsidering various tax credits, including the small-business-focused Enterprise Zone Hiring Credit, as he takes on a multiyear effort to shore up the state budget.

“The credit was one of the best jobs credit in the entire country, but cost the state much-needed revenue”, True Partner’s Sori says.

Still, the state prides itself on supporting venture capital and the entrepreneurial spirit, especially in technology. It’s that home to Apple of which Morrissey spoke, as well as to countless other high-tech firms packed into its Silicon Valley.

Third-worst: New York
Like California and Vermont, New York has high personal and corporate income tax rates and taxes on individual and corporate capital gains. It also has high property taxes, high consumption-based taxes, high gas and diesel taxes, an added estate tax and poor private property protections, among other things, according to the SBE Council.

“New York is a real killer because the state imposes a 7.1% [corporate tax rate] and New York City has their own tax rate of 8.85%,” Sori says. “If you’re doing business in the city of New York, it’s almost 16%.”

Among Democratic Gov. Andrew Cuomo’s agenda as he relocates to Albany is to transform New York’s economy.

“Business built New York, and we are declaring that New York is once again open for business,” Cuomo said in his State of the State Address.

Priorities include “holding the line on taxes and working to lower taxes in the future,” specifically property taxes. Cuomo is looking to foster job creation, in part by enhancing the state’s Excelsior Tax Credit Program, he says.

Cuomo also wants to expand support for minority- and women-owned small businesses, including “directing state agencies to double the current [Minority and Women-Owned Business Enterprises] participation goal from 10% to 20%; ease bonding restrictions for these business owners and expand the Owner-Controlled Insurance Program model to improve opportunities for small businesses,” according to his address.

Second-worst: New Jersey
New Jersey has a history of being unfriendly to business.

Like others on the list, New Jersey has high personal income and corporate income taxes as well as individual and corporate capital gains. It also has the second-highest property taxes in the nation, behind New Hampshire, according to the SBE Council’s report.

On the other hand, the Garden State has fairly low consumption-based taxes, a low crime rate and low gas and diesel taxes, the report notes.

Gov. Chris Christie seems dedicated to keeping businesses in New Jersey, but his plans are unclear.

The Republican governor “quietly dismantled” the state’s program for minority- and women-owned small businesses last year, according to media reports, but signed into law Senate Bill No. 2370, which calls for expanding New Jersey’s Business Retention and Relocation Assistance Grant program.

The program has helped businesses preserve jobs, expand operations and reinvest through the award of corporation business tax credits. Through the program, corporations will get a maximum tax credit of $2,250 per year for six years, per job retained in the state, versus a maximum one-time tax credit incentive of $1,500 per job retained.

In an address this month, Christie said he plans to put forth proposals to reform the state tax system.

“If New Jersey is to be a home for growth, we need to reform the taxes we place on business and individuals and begin to roll them back,” Christie said.

Worst: District of Columbia
Topping the list of worst states for small businesses is the District of Columbia. Our nation’s capital has the second-highest corporate tax rate income, behind Pennsylvania, and high personal-income, individual capital-gains rates and corporate capital-gains taxes.

The Washington, D.C., area also has high property taxes, an added tax for S-corporations, high electric utility costs, an imposed estate tax and the highest crime rate among the 50 states, according to the SBE Council.

Democratic Mayor Vincent Gray says he is looking to support small businesses in the area. One way is by increasing the opportunities for small businesses in the area to compete for government contracts.

Firms that make most of their money in Illinois will feel biggest hit
By Kathy Bergen, Tribune reporter
January 22, 2011
To view this article online Click Here

When Chicago-based investment research house Morningstar Inc. pays its state corporate income taxes for this year, the sting from the recent rate hike is expected to be negligible.

For the city’s financial exchanges, the rub is likely to be a bit more uncomfortable, with some analysts estimating it could shave 1.5 to 3.6 percent from 2011 earnings.

And for an Illinois medical-device firm, the hike and the suspension of a key deduction could bring its state tax bill from zero to as much as $95,000 — a stunning blow for a company that only became profitable in 2008. As a result, it may scrap plans to hire two research and development associates.

While the politically charged rhetoric continues to fly over the 46 percent increase in the corporate income tax, from 4.8 to 7 percent of Illinois earnings for the next four years, interviews with local companies and financial experts indicate the level of pain will vary significantly, depending on a company’s circumstances and structure.

While established companies with far-flung operations may wince briefly, those that make most of their money in-state will bear a greater burden.

And within that Illinois-centric group, those heading into the black for the first time and those returning to profitability after the deep slump will take it on the chin. That’s because for the next four years, they cannot offset their annual tax bill by taking a deduction for previous net operating losses. State lawmakers suspended that deduction at the same time they raised the tax rate.

“If you are kind of already struggling to get by year to year, even though you’ll be able to carry over net operating losses in 2015, that is a long time for a company that does not have a lot of wiggle room,” said Kathleen Thies, a state income tax analyst with CCH, a Riverwoods-based tax research firm.

The bottom line, say a number of observers, is that while some Illinois companies will threaten to leave the state to escape the tax increase (Jimmy John’s Gourmet Sandwiches is one that has voiced the threat) an exodus appears extremely unlikely. But economic recovery may be slowed and the state’s appeal as a place to expand a business or build a new one may be diminished — a possibility that has Indiana and Wisconsin sharpening their knives and corporate relocation marketing campaigns.

“I don’t think businesses are going to flock out of Illinois over this,” said Jim Kane, managing director of True Partners Consulting, a Chicago-based tax advisory firm. “The bigger effect will be on new investments a company wants to make.”

For Morningstar, which sells its investment research and consulting services worldwide, the tax hike “is not a significant change at the corporate level,” said Scott Cooley, chief financial officer. To get a sense of the added expense, the firm recalculated its 2009 tax burden using the new rules, and the extra cost was $266,000, less than 1 percent of an overall U.S. tax tab of more than $35 million.

Northern Trust Corp., another locally based company with global reach, last week estimated a $4 million annual hit to earnings. For a company with $669.5 million in earnings last year, this likely would amount to a reduction of less than 1 percent.

For the companies that operate two prominent Chicago financial exchanges, the potential hit is greater because much of their income is subject to Illinois taxes. While analysts have not yet altered their earnings projections for next year, they have indicated it is a possibility.

The corporate income tax hike could shave 1.5 percent from 2011 earnings for CME Group, which operates the Chicago Mercantile Exchange, according to an estimate by Sandler O’Neill & Partners. JPMorgan puts the potential hit at 3.2 percent.

The impact to the Chicago Board Options Exchange could be 2.4 percent, according to Sandler O’Neill. JPMorgan analysts estimate it could be closer to 3.6 percent.

The companies declined interview requests but issued separate written statements expressing their displeasure with the tax hikes. “These significant tax increases, which are not tied to any corresponding spending cuts, will negatively impact jobs and business opportunities for Illinois residents and stifle economic growth in our state,” the CME Group stated.

Corporations also pay a 2.5 percent tax on income, called the personal property replacement tax, which is collected by the state and flows to local government. That brings the effective rate on corporations to 9.5 percent, the third-highest in the country, according to the Tax Foundation.

That could translate into a 2011 tax bill of as much as $95,000 for a medical-device firm that launched in 2000, first became profitable eight years later and is expecting to make a $1 million profit this year, according to Jim Schultz, a partner at Effingham-based Open Prairie Ventures, an investor in the firm. He declined to identify the company, citing competitive issues.

The firm had planned to take a deduction for earlier losses, which would have canceled out its tax liability, but the state suspended such deductions for four years.

“It’s devastating to them,” said Schultz. The firm’s board now must rework its budget and scale back its hiring plans, he said.

The rule change also could cause cash-flow problems for Midwestern firms linked to the auto industry, many of which had losses in recent years and are just starting to make money again, noted Bill Danielson, a tax director at accounting firm Plante & Moran in Elgin.

“You can’t send Illinois receivables, you have to send cash,” he said.

For all the uproar over the corporate tax, only about one-third of the firms filing state income tax returns typically pay taxes. The rest either have no profits in Illinois or have sufficient deductions or tax credits to offset what they owe, though the ability to apply deductions will dwindle during the next four years due to the suspension of the net operating loss deduction.

And closely held firms and partnerships do not pay the corporate income tax, except for a reduced personal property replacement tax of 1.5 percent of Illinois income. Their company profits flow to shareholders and partners and are taxed at individual rates, which the state hiked from 3 to 5 percent until 2014.

This is still a relatively low individual rate — the Tax Foundation ranks Illinois the 14th-best state on this tax — but some local employers say it too will contribute to a weakening of the business climate.

Caterpillar Inc., of Peoria, estimates the hike in the individual rate will mean an additional $42 million will be taken from employee paychecks, making it more expensive for the manufacturer of earthmoving equipment to maintain employee pay levels in the state.

“It’s no secret that when making investments, businesses have to consider the costs,” Doug Oberhelman, chairman and CEO, stated in a recently published opinion piece.

Tax rates are a key factor weighed by businesses as they plan expansions and relocations, noted Brent Pollina, a relocation consultant based in Park Ridge. But many other issues come into play, too, among them the education level of the work force, the cost of utilities and the quality of state incentive programs, he said.

As well, “businesses don’t like to go to a state that is about to go insolvent,” said J. Fred Giertz, an economics professor at the University of Illinois at Urbana-Champaign. “If Illinois hadn’t done anything, it was on the verge of breakdown. It was a no-win situation.”

For steelmaker Evraz Inc. NA, which announced Thursday it was moving its headquarters from Portland, Ore., to Chicago, the tax hikes were not an issue, particularly because Illinois rates remain below those in Oregon, said Mike Rehwinkel, the company’s president and CEO.

The city’s key attraction was its central location and its major airports, which will allow executives to fly out to visit far-flung customers and plants more quickly and cheaply, he said.

“We truly believe being close to customers will allow us to grow our revenue base … so we’re willing to take a risk on the cost of a move,” he said.

“Higher taxes are always disappointing … and I believe it may stunt the growth of the economy,” Rehwinkel said. “Hopefully things will improve and they will reverse them in several years.”

By Laurie Kulikowski
January 13, 2011
 
Business owners beware: The massive tax hikes passed Wednesday in Illinois may be implemented in other states as legislators look to quash escalating budget deficits.
 
Illinois’ state legislature sent ripples in the tax community with this week’s passage of huge tax increases to personal and corporate income.
 
As part of the changes, the individual income tax rate for Illinois residents will rise this year by two-thirds, to 5% from 3%, before falling to 3.75% beginning in 2015 and to 3.25% in 2025.
 
The bill also calls for corporate income tax rates to rise to 7% from 4.8%. That level will fall to 5% in 2015 and back to 4.8% in 2025.
 
Furthermore, the bill calls for a four-year suspension of the net operating loss deduction, a commonly used tax strategy for business owners. The suspension is expected to cost $250 million annually, small-business advocates say.
 
The moves are significant, especially to small businesses that are not typically incorporated and instead pay individual income taxes.
 
“Most business owners are sole proprietors — S-corps, LLCs — so when you raise the personal income you’re hitting the bottom line of businesses,” says Ray Keating, the chief economist at the Small Business and Entrepreneurship Council.
 
Observers say the new rates will stifle business recovery in the state, limit start-ups and deter investors from Illinois-based businesses. But more importantly, some wonder whether other states will take a page from the Illinois state legislature and also raise taxes.
 
“I think every state has to look at their financial picture, and most of them are running deficits right now,” says Jim Kane, a managing director and co-founder of Chicago-based tax consultant firm True Partners Consulting.
 
Kane says the move by the Illinois state legislature was risky given the economic environment, in which multiple federal measures have been put together to spur economic growth, particularly for small businesses.
 
“If they are operating as a corporation then this will probably cause them not to operate as a corporation,” he says of entrepreneurs. “If they’re looking to start a business and there is a choice, this is a pretty high rate. They may choose another state if they have that flexibility.”
 
Wisconsin Gov. Scott Walker issued a statement in direct response to its neighbor’s tax hikes, saying the state is “open for business.”
 
“In these challenging economic times while Illinois is raising taxes, we are lowering them,” Walker said in a statement. Under Walker’s direction, the state legislature is “taking up bills to provide tax relief to small businesses, to create a job-friendly legal environment, to lessen the regulations that stifle growth and to expand tax credits for companies that relocate here and grow here.”
 
But if moving your company is not an option — small businesses are typically entrenched in the community they serve — owners will have to take a hard look at their expenses.
 
Kim Maisch, National Federation of Independent Business’ state director for Illinois, says state lawmakers will have “tremendous pressure” to help business owners reduce costs in other areas so as not to raise prices.
 
“One of the few highlights of Illinois economic policy was that we had a low flat income tax,” Maisch says. “We have now thrown out that tool and we’ve now gone to one of the highest corporate income tax” among all 50 states.
 
Maisch says business owners don’t have many options to offset higher taxes. They can either raise prices on goods and services; trim employee health care benefits, often resulting in employees being forced to pay more; or try to shop around for better workers’ compensation programs, for example.
Small-business owners should get politically involved, Keating says.
 
“Your voice carries more weight in the political process than does the average person because you’re a business owner. You matter greatly to the state’s economy, so it is critical for you as a business owner to voice your opinion,” he says.

SmallBusinessChicago
 
Small businesses brace for higher income tax rates
By Ann Meyer
January 13, 2011
 
The 67 percent income tax hike that Illinois lawmakers approved last night to address the state’s financial crisis will cause small businesses pain but probably won’t spur them to leave the state or do business differently, observers said.
 
By increasing the personal income tax rate to 5 percent from 3 percent and the corporate income tax rate to about 9 percent, the plan is expected to generate about $6.8 billion in new revenue a year, putting a large debt in the state’s $15 billion deficit over the next four years. After that period, the personal income tax rate will drop to 4 percent.
 
Split down party lines
 
Democratic lawmakers moved quickly to pass the measure before a new General Assembly was sworn in at noon today that could have changed the outcome, according to Crain’s Chicago Business. The proposal passed the House Tuesday night by a vote of 60-57, with no Republicans voting for it.  Gov. Pat Quinn, who supports the measure, is expected to sign it.
 
While legislators scaled back the increase in the corporate income tax rate to 7 percent from a proposed 8 percent hike, when the personal property replacement tax is factored in, the corporate tax rate rises to about 9 percent, experts said.
 
Business groups oppose plan
 
The plan was strongly opposed by business groups, including the Chicagoland Chamber of Commerce, which said the increase would discourage new businesses from coming to Illinois. “We want to bring new businesses to Illinois. When you have the highest tax rate in the country, it’s really hard to do that,” James Kane, head of the Chicagoland Chamber’s taxation committee, said in a recent interview on Fox News. Kane, who is also managing director at True Partners Consulting in Chicago, could not be immediately reached for comment. When the personal property replacement tax is added to the corporate income tax, the corporate tax rises to about 9 percent.
 
Business owner Angelika Coghlan, president of Catwalk Consulting, an IT firm in Schaumburg, opposed the plan but doubts it will drive away companies who see a business opportunity in Illinois. “It won’t prevent you from doing business here,” she said.
 
Small business needs `overlooked’
 
But Coghlan also would have liked to see the state earmark some funds for small business development. “It’s still difficult to get money to run our businesses,” she said. “There’s more that could be done at the state and federal level to provide more opportunity ” for small businesses to get loans, but those needs were “overlooked,” Coghlan said.
 
In addition, Coghlan would have like to see the tax hiked imposed on a sliding rate. “Other states have put programs in place that raised income tax but it was based on salary level, which makes more sense,” she said.
 
Still, rather than complain about the new pain the tax hike creates, Coghlan said, “We deal with it. We’ll adjust.”
 
Looking at the big picture
 
Taking a long-term view, some small business owners supported the plan. “Having a state that’s solvent is the big picture,” said Susanne Hack, president of Susanne Hack & Associates, a lobbying firm in Chicago, who was at the state Capitol last night when the measure passed.
 
“Speaking for myself, I realize it was absolutely necessary,” Hack said. “Of course I don’t want to pay more, but I realize we have to pay our bills and move on.”
What’s more, Hack said, failing to act would have been worse. “There’s going to be some pain by individuals and corporations, but it would have been an economic and social disaster if there wasn’t some sort of revenue stream,” Hack said.

FOX Chicago News
The Illinois legislature will go back to work Monday to try to reach agreement on a state income tax hike.

They’re still trying to gauge the impact of any tax increase. James Kane, head of the Taxation Committee of the Chicagoland Chamber of Commerce, joined us.

To watch the interview Click here.

Tucci brings more than 12 years of experience in unclaimed property

CHICAGO– November 08, 2010 – True Partners Consulting LLC today announced Robert Tucci, 46, has joined as a director in the National Unclaimed Property Practice.

Tucci brings more than 12 years of experience in unclaimed property consulting, specializing in the performance of comprehensive diagnostic reviews, multi-state audit defense, and the development and implementation of policies and procedures. 

“Robert is one of the nation’s preeminent experts in Unclaimed Property — an issue rising rapidly in significance in today’s economic climate,” said Cary McMillan, chief executive officer.  “True Partners remains one of the fastest-growing tax and business consulting firms in the country precisely because of our ability to attract top talent like Robert and provide differentiated expertise to our clients.”

In his new role, Tucci, who will be based in Dallas, Texas, will be responsible for assisting large and mid-sized companies with their unclaimed property needs.  In addition, Tucci will be counted on to be an integral part of the firm’s initiative to establish the True Partner’s National Unclaimed Group as the nation’s preeminent unclaimed property services provider.

“I’m delighted to be part of a seasoned team at True Partners featuring some of the top experts in the industry working side-by-side to address many of the most complex tax and regulatory challenges facing companies today,” said Tucci.

Tucci has provided unclaimed property consulting services to public and private clients, including the Fortune 500, in numerous industries including retail, healthcare, manufacturing, financial services and energy. 

Before joining True Partners Consulting, Tucci held the position of co-leader of the National Unclaimed Property Practice at Grant Thornton LLP. He was also the central region leader of the National Unclaimed Property Services Group at Deloitte & Touche.

Tucci received a Bachelor of Science degree in Accounting from Philadelphia University and has also served as a speaker for educational seminars sponsored by the Unclaimed Property Professional Organization and other professional groups.

About True Partners Consulting LLC
True Partners Consulting is a world-class tax and business advisory firm that helps large public and private enterprises navigate complex tax and financial regulations without the Sarbanes-Oxley created conflicts inherent in offering both tax consulting and audit services.  The firm provides a broad range of income, sales, use and property tax services, including maximizing the tax benefits associated with complex corporate transactions, acquisitions, dispositions, restructuring and bankruptcy; audit defense, accounting for income taxes and uncertain tax positions, refund reviews, negotiating and claiming credits and incentives, preparation or review of tax returns, unclaimed property, tax risk and process reengineering, international tax and transfer pricing.

The firm has offices in Chicago, New York, Los Angeles, Woodland Hills, San Jose, Tampa, Boston, Denver and London.  The True Partners Consulting International Network includes member firms in the following countries:  France, Italy, Spain, Hong Kong, China, Singapore, Germany, The Netherlands and South Korea.  Find additional information at www.tpctax.com.