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This article originally appeared in the April 2022 TaxStringer, a publication of the New York State Society of Certified Public Accountants. The IRS directed partnerships to report capital accounts on the tax basis starting in 2020. In this article, author Dean L. Surkin, JD, LLM addresses the prior rule, why the IRS wasn’t happy, the change they wanted, how to process the transition, and the need to maintain both the former capital account and the IRS-prescribed method. Overview The partnership agreement determines each partner’s share of partnership items, provided it meets two requirements— the agreement must provide for allocation, and the […]

 The incoming administration has floated a number of tax proposals. Any and all proposals are subject to negotiation with Congress. As of this writing, the Democrats control the House, albeit with a smaller majority than in 2018, and the Senate is up for grabs, awaiting the results of the January 5th Georgia runoff elections.  If the Republicans continue to control the Senate, it is unlikely that any of Mr. Biden’s proposals will be enacted. If the Democrats control the Senate, the fact that they would hold a bare majority (50 seats plus Vice-President-Elect Harris as tie-breaker) makes it unlikely that […]

In every presidential election year, there is interest in whether the next year will see changes in the tax laws. Predicting tax law changes is speculative, because it depends upon too many variables: who wins the presidency, which party controls the House, which party controls the Senate, whether there is unified or divided control of the government, and whether the economic and political climate after the election favors or disfavors any proposals that may have been floated during the campaign. As with any change in the tax laws over the last several decades, changes offer new opportunities for planning. Regardless […]

The “Setting Every Community Up for Retirement Enhancement” Act (the SECURE Act), which is part of the Further Consolidated Appropriations Act, 2020 (P.L. 116-94) signed into law by the President on December 20, significantly modifies many requirements for employer-provided retirement plans, individual retirement accounts (IRAs), and other tax-favored savings accounts. Congress recently passed-and the President signed into law-the SECURE Act, landmark legislation that may affect how you plan for your retirement. Many of the provisions go into effect in 2020, which means now is the time to consider how these new rules may affect your tax and retirement-planning situation. Here […]

On April 12, 2019, Governor Cuomo signed the New York State (“NYS”) Fiscal Year 2019-2020 Budget Bill (“Bill”) which extends some previously enacted changes as well as adding new provisions. Discussed below are the major highlights of the Bill. PERSONAL INCOME TAX Extension of the Millionaire’s Tax: The top NYS personal income tax bracket of 8.82% was scheduled to expire after 2019. The Bill extends the “Millionaire’s Tax” for five years, through 2024. Extension of Charitable Contribution Deduction Limitation: Currently, the NYS itemized charitable deduction is limited to 50% of the federal deduction for individuals with adjusted gross income (“AGI”) […]

The TCJA brought about many federal changes to both personal and business taxes. Many states starting point in determining taxable income is federal income which lead them to decouple from certain changes. New York State (NYS)  is one of them. With respect to personal income tax, the NYS Department of Taxation and Finance has put out guidance highlighting its tax treatment of various federal items of income, deductions and credits. Specifically, it issued TSB-M-18(6). Below are the highlights: Personal Tax Income Alimony or separate maintenance payments NYS opted not to follow changes made by the TCJA to the treatment of […]