Tax

The Corporate Transparency Act (CTA) passed in 2021 includes several provisions designed to prevent illegal activities such as money laundering and tax evasion. A key component of the legislation is the requirement for businesses to file Beneficial Ownership Information (BOI) to the Financial Crimes Enforcement Network (FinCEN). The reporting opened January 1, 2024, but has experienced several delays due to ongoing litigation. The culmination has been a delay in the reporting requirement since mid-January.

The U.S. has announced new tariffs of 25% on all imported steel and aluminum, set to take effect on March 12, 2025. The measure eliminates prior exemptions for Canada, Mexico, the European Union, the United Kingdom, Japan, and other key trading partners. For business leaders, the immediate concern is the rising cost of raw materials and potential supply chain disruptions. The move is part of a broader effort to boost domestic manufacturing, but industries reliant on imported metals, including construction, automotive, and energy, are expected to face higher expenses. Economists estimate the tariffs will impact $50 billion worth of goods.

Starting January 1, 2025, Illinois changed how sales tax applies to leased tangible personal property (TPP). Instead of taxing the purchase of leased equipment, the state now requires sales tax to be collected on lease payments. This update, part of Public Act 103-0592, revises the Retailers’ Occupation Tax to bring Illinois in line with how most other states tax leases. While the new system simplifies tax collection for the state, it introduces new compliance requirements for businesses that lease equipment. Lessors will need to adjust how they collect and report sales tax, and lessees should be aware of how rental costs will change. These updates apply to in-state companies, but also those out of state businesses that meet certain thresholds.

The Georgia Investment Tax Credit is an incentive currently being offered by the state to provide opportunities for industrial and telecommunications companies to earn tax credits for qualified investments.  Manufacturing businesses, or those that offer telecommunications support, can earn investment tax credits if they have been operating in Georgia for 3 or more years. These credits can be used for expansions or upgrades to the business. The value varies between 1-8% of qualified capital investments of $100,000 or more per project or location per tax year.

On December 3, 2024, a federal court temporarily blocked enforcement of the Corporate Transparency Act (CTA), which requires most U.S. businesses to file Beneficial Ownership Information (BOI) reports. For now, businesses do not need to file, but this could change quickly. The Department of Justice (DOJ) is appealing against the decision, and the Fifth Circuit Court of Appeals is expected to rule by December 20th. If enforcement is reinstated, businesses will face the January 1, 2025, deadline with little time to act.

The Tax Cuts and Jobs Act (TCJA) of 2017 introduced significant changes to the U.S. tax code, offering tax savings, reductions, and other benefits to individuals, businesses, and families. The more popular provisions included an immediate reduction in the business tax rate, a new pass-through entity deduction (Section 199a), Net Operating Loss carrybacks, and changes to the annual estate tax exclusion. However, several of these provisions are scheduled to expire at the end of 2025, creating uncertainty for businesses. As the deadline approaches, it is important to be aware of the changes and how to prepare.

The IRS announced yesterday new tax relief measures that extend certain federal tax deadlines until May 1, 2025. This has extended various filing and payment deadlines and applies to all Georgia residents and businesses. The relief applies to income tax returns normally due in March and April. It also covers 2023 individual and corporate returns with valid extensions and estimated quarterly payments.

Millions of U.S. businesses must now comply with Beneficial Ownership Information (BOI) reporting rules, with the deadline set for January 1, 2025. Under the Corporate Transparency Act, businesses are required to submit BOI reports to the Financial Crimes Enforcement Network (FinCEN). The goal is to increase transparency and prevent financial crimes, such as money laundering and terrorism financing. As of August 2024, only 2.7 million of the 32.6 million businesses required to report have done so. These rules mandate businesses to provide detailed ownership information to the federal government.

Recent changes in Tennessee tax law now allow businesses to claim refunds for franchise taxes on previous payments. On May 10, 2024, Public Chapter 950 was signed into law, eliminating the property measure from the franchise tax calculation. Starting January 1, 2024, businesses will calculate franchise taxes based only on net worth, simplifying the process and potentially lowering tax liabilities.

The Georgia Department of Revenue (DOR) has issued new guidance regarding the state’s Job Tax Credit, a valuable incentive for businesses that create new jobs. This guidance is particularly relevant for companies with questions about meeting minimum wage requirements and how to treat jobs transferred between locations. The recent changes' central focus is the minimum wage requirements and the treatment of transferred jobs.