New Tax Credit Laws Start NOW
-------------------------------------------------------------------------
There has been a lot of confusion about the changes made in the 2009 tax credit laws. One big item that many of you have asked about involves the "look back" changes affecting when you can amend prior year returns for Retraining (RTC) and Job (JTC) tax credits. The period was reduced from 3 years to one year.
The key driver is the activity and the tax year when it occurred.
The activity could be:
- RTC = train employees
- JTC = headcount increase that meets the threshold for the location
The tax year in which the activity occurred will determine how long the tax return can be amended for RTC and JTC purposes:
- 2009 = can only amend up to one year after the return was due or extended
- 2008 or prior years = can amend if the tax return is open (within 3 years)
When things slow down after tax season and year-end tax planning begins, make sure you talk with your clients about 2009 RTC and JTC activities -- before the tax credit $$ are gone!
|
What is Immaterial About Tax Credits??
-------------------------------------------------------------------------
As you review tax saving opportunities for your clients, you may not have much time to explore activities that qualify for state tax credits. On the surface, tax credits may appear to be too small $$ and not worth your or your clients' time and resources. In addition, the cost to amend the corporate and the equity owners' personal tax returns may cause hesitation.
Sound familiar? Clients have told us that their CPAs throw out buzz words like "immaterial" and "onerous duty" as vague reasons not to pursue the tax credits.
It is funny how a recession can redefine words. When things were great a few years ago, the tax credits had to be BIG $$ to be worth pursuing. Well, this recession seems to have significantly lowered the $$ threshold and changed the meanings of "immaterial and "onerous duty"!!
Suggestion: Re-evaluate your clients' situation and do a quick net-after-tax benefit analysis (after all other fees including fees for amending tax returns). If the hard $$ benefit to each owner is a few $$ thousand, it may be worth it. During these tough times, an "immaterial" event like a tax credit may keep your client happy!
|
About Us
-------------------------------------------------------------------------
Alpharesults has assembled a team with the specialized knowledge and approach required to obtain Georgia income tax credits. We are not a public accounting firm. Rather, our services complement those of public accounting firms and do not create conflicted loyalties, because our professionals do not perform attestation work or other external audit functions.
We focus on small to medium-sized businesses and work exclusively in Georgia with a wide variety of in-state and out-of-state accounting firms. For more information on our services, follow this link.
|
