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 A Tax Professional's Guide to Credits and Incentives, Courtesy of Alpharesults
 Vol. X No. 7 July 2016
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In this issue
Costs to Obtain Tax Credits
Spotlight on Missouri Credits and Incentives

Hello!

Welcome to Alpha-Mail, the monthly newsletter about tax credits and incentives for tax professionals.

This month, learn that even though tax credits provide great cash flow for your clients, you need to be aware of their potential costs!   Also, some of you may have clients who own businesses in Missouri, so be sure to see our overview of Missouri credits and incentives. 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&JimSigsSM1     
 Dale Stapler    Jim Tinsley
     Alpharesults, LLC 
 
 
 

Costs to Obtain Tax Credits                           
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As you explore tax credit opportunities for your clients, you need to be aware of the potential costs of tax credits. These costs may include:
  • Out of pocket - You and your staff's non-billable time and expenses to investigate, analyze and present ideas to your client.
  • Fees - What will this costs your client for your services and other providers' fees?
  • Opportunity costs - The alternative to tax credits is that your client doesn't utilize the tax credit and pays the income taxes.
  • Risks - If you don't bring this up to your client, is it worth the risk of them asking why you didn't mention tax credits to them, or someone else telling them?
  • Learning curve - Your time, effort and resources required to get up to speed. If this is a strategic client, a competitive situation or vertical market that you are pursuing (for example, distribution), it may be worth the investment. Where can you go to quickly determine if the tax credit can benefit your client?
  • Keeping up - What is your cost to stay abreast of tax credits? This may include keeping up with legislative issues, regulatory changes, expiration/sunset of the tax credits and other issues. Are there resources to help with this effort?
There could also be other costs associated with tax credits. These costs can be short term (such as non-billable hours) or long term (for example, client moving to a different CPA firm). So remember -- regardless of the costs -- reach out to your clients and find their tax credits!  

 
JimSig  

Missouri Credits and Incentives            
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As we've mentioned before, our Georgia clients frequently ask us to investigate potential credits and incentives in other states where they have operations, potential acquisitions or strong relationships with customers or vendors. In addition, private equity groups ask us about potential $$ for their portfolio companies.
 
We were recently asked about credits and incentives in Missouri, and their state economic development professionals gave us some details (mo.gov incentives site click here).
 
Missouri offers a middling selection of credits and incentives for new and existing businesses called Missouri Works.  CNBC ranked Missouri #31 in their 2016 America's Top States for Business survey (Georgia was #8 in the same survey).    
 
Incentives and Credits include:  

Missouri Works -- Tax credit programs called Zone Works, Rural Works, Statewide Works, and Mega Works.  Complex process, pre-approval is always required.

Missouri Works Training -- provide funding assistance when companies need to upgrade worker skills due to:
  • New products or processes.
  • New Technologies.
  • Competition driving quality or productivity improvement.
  • Relocation or expansion.
Other Incentives -- Emphasis on industrial bond and other financing programs.
 
Compared to Georgia, Missouri has:
  • Slightly higher corporate and same personal income tax rates.
  • Higher combined state and local tax burden
  • A far narrower range of incentives.
  • Pre-approval required for all incentives
To summarize, Missouri is below average for business tax incentives, not much else to say! 
 
 
DaleSig
   
 

About Us
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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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Contact Information
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email:  alpha-mail@alpharesults.com                   phone: 770-667-1332
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