What the tax code changes could mean for TBED activities
Please note: this article is not intended as a comprehensive review of Public Law No. 119-21, nor should our reading of the law be treated as tax or legal advice.
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Election 2023: Gubernatorial Campaigns, State Legislatures & Ballot Measure Initiatives
Three states are holding gubernatorial elections this fall, with voters in one of those states (Louisiana) having already chosen a new governor to replace a term-limited incumbent. In the remaining states, Kentucky and Mississippi, elections will be held next week (Nov. 7), with the incumbents facing tough opponents in their reelection bids.
IRS provides new direction on R&D expenses
The Internal Revenue Service recently published new interim guidance for companies to use when amortizing research or experimental expenditures — a new requirement for tax year 2022 created in the Tax Cuts and Jobs Act.
Indiana passes new legislation impacting college affordability and military tax exemptions
The Indiana General Assembly recently passed three bills that have the potential to impact the workforce in the state. Two bills address college affordability while the third exempts active-duty military from paying individual state income tax.
The Indiana General Assembly recently passed three bills that have the potential to impact the workforce in the state. Two bills address college affordability while the third exempts active-duty military from paying individual state income tax. House Bill 1449 will automatically enroll eligible students in a state program that offers 100% tuition coverage at public colleges, and Senate Bill 167 mandates high school students to complete and submit the Free Application for Federal Student Aid (FAFSA) to increase students applying for financial aid. Meanwhile, House Bill 1034, now signed into law, exempts active-duty military from paying individual income taxes starting with fiscal year 2024.
Concerns raised about 2017 tax law’s impact on industry R&D
While the Tax Cuts and Jobs Act of 2017 was passed more than five years ago, many businesses seem to be just discovering the effects of one of its sections this tax season. The law stipulated that, for tax years beginning in 2022, companies could no longer choose to expense their entire “research and experimentation” costs in one year and must instead amortize those cost over five years (with a half year look-back).
Treasury releases Opportunity Zone Guidance, states begin releasing RFIs
The IRS and CDFI Fund released their first guidance for the federal Opportunity Zones incentive. This wave of guidance addresses zone selection issues only — the most important clarification is that the certification window will expire on March 21, with the option to request one 30-day extension.
The IRS and CDFI Fund released their first guidance for the federal Opportunity Zones incentive. This wave of guidance addresses zone selection issues only — the most important clarification is that the certification window will expire on March 21, with the option to request one 30-day extension. The guidance includes a list of all eligible census tracts, which were covered by SSTI last week, as well as a list of tracts that are not low-to-moderate income but may be included in contiguous Qualified Opportunity Zones.
What the tax plan means for innovation
The Republican tax plan passed Congress this week. The legislation, which is part tax cut — $1.5 trillion over 10 years — and part reform — replacing multiple deductions and credits with overall lower rates — will affect the U.S. economy for years to come. Education, employment, capital access and business investment are likely to be directly affected as soon as next year, and, if state budgets hold any value as predictors, regional innovation economies will be particularly affected through future reductions in federal spending.
How the House tax plan might affect innovation
From investment returns to education savings, R&D incentives and more, tax policy and innovation are inextricably linked. Not surprisingly, the U.S. House GOP’s tax plan, released last week and updated through a significant amendment on Monday, could have significant impacts on the innovation economy.
Current[1] proposals with implications for innovation include:
Foundations look for 50% tax cut
Presently, the IRS provides private foundations a tax break if they show a trend of exceeding qualifying distribution requirements (grants).
Presently, the IRS provides private foundations a tax break if they show a trend of exceeding qualifying distribution requirements (grants). The legislative intent is for the tax reduction to serve as an incentive or reward for those foundations that are more generous with their grants over a five-year period than the 5 percent minimum distribution required by law. The Council of Foundations wants all philanthropists to get the tax break regardless of the trends in their generosity and disbursements. Four senators apparently agree with the council as they have included the provision in S. 1343, the recently introduced bill addressing several tax provisions dealing with charitable giving. The bill was introduced by Sens. John Thune (R-S.D.) and Bob Casey (D-Pa.), both members of the tax-writing Senate Finance Committee, with Sens. Pat Roberts (R-Kan.) and Ron Wyden (D-Ore) as co-sponsors.