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Alpha-Mail 
The Tax Professional's Guide to Georgia Tax Credits, Courtesy of Alpharesults
Vol. VI No. 2 February 2012
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Hello!
Welcome to Alpha-Mail, the monthly newsletter about Georgia tax credits for Georgia tax professionals.
This month, we want to show you how to "Crack the Code" to find hidden tax credits in your clients' NAICS code designations. Also, find out how the Georgia Legislature is doing with implementing tax credit changes. And last but not least, get our update on the GSCPA Healthcare Conference. We hope you can use this information to strengthen your client relationships! Thank you for reading Alpha-Mail -- please click reply to tell us what you think. All the best, 
Dale Stapler Jim Tinsley
Alpharesults, LLC |
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"Crack the Code" to Get More Tax Credits!
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Did you know that the little 6 digit NAICS code (North American Industry Classification System, 2007 edition, click here), on the first page of your clients' Georgia corporate income tax return, can help you find tax credit $$? In fact, they may qualify for multiple tax credits resulting from business activities:
- Job Tax Credit: Must be a Business Enterprise (Manufacturing, Telecommunications, Distribution, R&D, Processing, Tourism, Broadcasting, Services to elderly/disabled). If more than one business activity is conducted at your client's location(s), only those jobs engaged in a qualifying activity will be eligible. But the jobs' activities can help you find a hidden business enterprise inside (click here for a listing of Job Tax Credit qualifying NAICS codes).
- Investment Tax Credit: Must have manufacturing or telecommunications activity. The same principle applies -- that is, your client may have multiple business activities at its locations (click here for a listing of Investment Tax Credit qualifying NAICS codes).
Here's an example of a retail establishment that on the surface can only use the Retraining Tax Credit. Their NAICS is 453998 - All Other Miscellaneous Store Retailers. However, behind the retail front they also engage in a manufacturing activity, NAICS 311800 - Bakeries and Tortilla Manufacturing. This manufacturing activity makes them eligible for multiple tax credits - Retraining, Job & Investment Tax Credits.
So if you have a new client, or if you need to energize your relationship with an old one, dig into their business activities to determine if their NAICS code is correct. Or find one that was hidden in plain sight! Ask your clients a few more questions during this tax season, and you may flesh out $$ today and in the future!
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Tax Credit Legislative Update
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So far, the recommendations of the Georgia Competitiveness Initiative have surfaced in one bill, with more activity to come. Here's a summary:
HB 868 - Representative Doug Collins of the 27th (Governor's floor leader) and others amends Article 2 of Chapter 7 of Title 48 of OCGA relating to "imposition, computation, and exemptions from state income tax, so as to provide for the comprehensive revision of income tax credits for business enterprises located in less developed areas, designated by tiers, for business enterprises located in less developed areas consisting of contiguous census tracts, for existing manufacturing and telecommunications facilities located in certain tier counties, and for establishing new quality jobs or relocation quality jobs; and for other purposes."
But this bill doesn't represent all of the GCI recommendations: the twists and turns of the Ga General Assembly continue. The bill was voted out of subcommittee and slated for full Ways and Means as we write this. No revisions so far, which could come in the Senate. The bill has to get passed by the full house by Day 30 to remain alive.
The other dynamic affecting passage of the bill in the House is a percolating effort to resurrect some of the Tax Council's recommendations from last year. All things with fiscal impact to the state are related! So perhaps some clarity soon? Certainly not a linear process around here.
The other GCI reccomendations are reportedly to be a part if a larger bill to be seen sometime this week. So look out for a complex procedure involving "bill substitution," "vehicles," "shells," "content stripping," and "new content!" New content may involve things like the removal of sales tax on energy for manufacturers and some "untold goodies."
Stay tuned!
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GSCPA Healthcare Conference Update
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We exhibited at the annual GSCPA Healthcare Conference this month. There were over 240 attendees. Here are some highlights: - John Fox, CEO of Emory Healthcare: The business of healthcare is quickly moving to an outcome based pay for performance model, away from fees based on procedures. The new physicians entering the work force are looking for work-life balance, work environment and stability as key factors in their job search. He emphasized that we can't continue with the current "Tower of Babel" approach of multiple EMRs (electronic medical records systems) that can't talk with each other. He said that integration and cooperation will drive down cost by increasing patient quality and increasing efficiencies.
- Physician practices that are merging with other practices or selling to hospitals: There were several sessions about selling a practice and business valuation. The key drivers for added valuation (that is, above the classical EBITDA multiple) are how tightly integrated are the practice's workflows and EMR, how well is patient quality tracked, and what other services are performed (such as physical therapy, CT, and other related services).
This was a great conference to hear speakers, meet healthcare CPAs, and stay abreast of the rapidly changing healthcare environment. We hope to see you there next year!
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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. |
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