Tax

Digital assets, including cryptocurrencies like Bitcoin and Ethereum, have become significant players in the global economy. As their use has grown, so has the need for regulatory oversight to ensure compliance with tax laws. According to data from the Federal Reserve, 7% of U.S. adults used cryptocurrency in 2023, either as an investment tool or for making financial transactions. To address this growing sector, the IRS recently issued final regulations (T.D. 10000) detailing the reporting requirements for digital assets.

The Georgia Manufacturing Investment Tax Credit is a financial incentive aimed at supporting businesses in the manufacturing and telecommunications sectors. By making capital improvements more affordable, this state credit encourages companies to expand and upgrade facilities, promoting economic growth and job creation throughout the state. The credit can offset up to 50% of a company’s Georgia corporate income tax liability, and any unused portion can be carried forward for up to 10 years.

On May 10, 2024, Tennessee Governor Bill Lee signed Public Chapter 950 into law, eliminating the property measure for computing the franchise tax starting January 1, 2024. This change is expected to benefit many businesses across Tennessee, particularly those with substantial real and tangible property, such as in the real estate, retail, transportation, and manufacturing sectors. With the property measure removed, the net worth measure is now the sole method for calculating the franchise tax.

The Inflation Reduction Act, signed into law in 2022, called for new taxes to tackle the rising deficit while investing in clean energy technology. A key component of the legislation was the introduction of clean vehicle tax credits to purchase new and used electric vehicles (EV). This includes the new vehicle tax credit, used vehicle tax credit, and the commercial clean vehicle tax credit. Each provides purchasers with an immediate federal tax credit for purchasing an eligible EV. Since its passage, several updates have been to the temporary guidance addressing specific aspects of the incentives. However, earlier this month, the Department of Treasury issued final regulations, including guidelines for batteries, critical minerals, and the need for Foreign Entity of Concern (FEOC) compliance.

As the 2024 presidential election approaches, tax policy remains a pivotal issue in the platforms of both major candidates: former President Donald Trump and President Joe Biden. Each has outlined distinct visions that promise to reshape the nation’s fiscal outlook, impacting individual taxpayers and the business community. Trump advocates for deeper tax cuts, while Biden proposes increased rates for higher earners and corporations, making understanding these policies crucial for effective financial planning and strategy.

The 2024 legislative session in Georgia concluded on March 28th, marking a significant period of legislative activity that promises to reshape the state’s financial landscape. During this session, the General Assembly passed several tax bills, including a substantial $500 million in tax cuts for both individual and corporate taxpayers in Georgia. Additionally, several constitutional referendums will be placed on ballots, giving voters a direct say in the state’s tax policies.

The Department of Treasury and the Internal Revenue Service have released Announcement 2024-19, which provides detailed guidance on the federal tax implications of rebates under the Department of Energy (DOE) home energy rebate programs. These programs are funded through the Inflation Reduction Act of 2022 and are designed to promote the adoption of energy-efficient technologies in residential settings. This announcement is crucial for homeowners and industry professionals, helping them understand how these rebates integrate into the broader federal tax system. To help clients, prospects, and others, Wilson Lewis has summarized the key details below. Background on DOE Home Energy Rebate Programs The DOE Home Energy Rebate Programs were launched to promote widespread energy-saving retrofits and high-efficiency home electrification projects, contributing to national energy efficiency and environmental sustainability goals.

On March 11, President Biden presented a budget proposal that seeks to enact nearly $5 trillion in tax adjustments over the next decade. Key facets of this proposal focus on modifying the tax obligations of corporations and individuals earning above $400,000 annually. Notably, the initiative revisits and expands upon elements from previous budgets, incorporating both established and new measures aimed at tax reform. While inclusion in the presidential budget does not guarantee that the provisions will be enacted, it does provide important insight into the administration’s priorities. To help clients, prospects, and others, Wilson Lewis has summarized the key details below.

Many businesses regularly conduct research and development projects to improve processes and efficiencies and to uncover ways to make new and more valuable products. Companies with dedicated research and development functions invest significant human and financial resources in the process. Others without a formal department often invest in such activities continuously with a limited scope. These activities are essential because they help to create new or improved products and uncover efficiencies and enhancements. While helpful, these activities can be pretty expensive, leaving management unable to continue efforts in the long term.

In late November, the IRS announced a delay in the $600 reporting threshold requirement for payment apps and online marketplaces. The decision was made due to feedback received from tax professionals and payment processors and general taxpayer confusion. The 2023 tax year will serve as another transition year leaving prior threshold reporting requirements in place. This means only payees who made gross payments of more than $20,000 or more than 200 transactions will remain. The delay is welcome news for businesses that would otherwise be required to prepare and submit Form 1099-K.