Under the Affordable Care Act, Many Plans Subject to PCORI Fee
Under the Patient Protection and Affordable Care Act “PPACA,” certain types of health insurance arrangements will be required to pay a new fee by July 31, 2013. The fee is called the Comparative Effectiveness Research Fee or the PCORI fee because the monies will be used to help fund the Patient-Centered Outcomes Research Institute. The types of arrangements subject to the fee are:
- Fully insured medical plans
- Self-insured medical plans
- Plans sponsored by private, government, nonprofit and church employers
- Individuals on a temporary U.S. visa who reside in the U.S.
- Retiree-only plans
- Health Reimbursement Accounts (HRAs)
- Certain Flexible Spending Accounts (FSAs) if the employer contribution is greater than $500 and it is more than the employee contribution
The fee will be reported to the IRS via Form 720, but the revised Form 720 has not yet been made available.
In general, plans with year-ends between October 1, 2012 and December 31, 2012 must file Continue reading »
Maryland Increases and Decreases Security Clearance & SCIF Credits
The Maryland legislature has increased the income tax credit for employer costs related to obtaining federal security clearances and constructing or renovating sensitive compartmented information facilities (SCIF) within Maryland (L. 2013, c. 482, § 1). The legislation also enacted an additional credit for first year rental payments for spaces leased in Maryland by a small business performing security-based contracting. The modifications to the Maryland Employer Security Clearance Costs (ESCC) Tax Credit take effect on Continue reading »
A “Wynne” for Maryland Taxpayers
On May 17, 2013, the Maryland Court of Appeals denied the Comptroller’s motion for reconsideration of the Court’s taxpayer-favorable decision issued earlier this year in Comptroller v. Wynne. The Court held the resident credit for taxes paid to other states must include the local tax in addition to the state portion of the tax. Specifically, the decision ruled that the failure to allow a credit for the county tax for out-of-state taxes paid to other states on “pass-through” income earned in those states unconstitutionally discriminates against interstate commerce.
Maryland’s income tax has a state portion with a maximum rate of 5.75% and a county portion with rates that range from 1.25% to Continue reading »
Sale for Resale – An Easy Concept That’s Costly if Missed
A recent Virginia sales and use tax ruling illustrates how ignoring basic sales and use principles can be costly for businesses. The concept is simple – a sales tax is a consumption tax imposed on the end user of a product. Thus, if your company purchases tangible personal property with the intent of reselling the property (i.e., not consuming it), it generally should not pay sales tax on that purchase. This concept holds true for leases as well. However, a purchaser must notify a seller of this intent by providing a certificate to the seller indicating that the purchased product will be resold. Otherwise, the seller is obligated to collect sales tax.
The failure to apply this foundational sales and use tax concept had a costly result for Continue reading »
Health Care Reform Issues for Construction Contractors with Aronson LLC
The passage of the Patient Protection and Affordable Care Act, commonly known as Obamacare or Health Care Reform, has created many questions for employers throughout the construction industry.
Join Aronson LLC and Independent Benefit Services on May 8, 2013 for an informative presentation on the various provisions of healthcare reform that will have a profound impact on how healthcare is delivered and funded in the United States. Our experts will cover the major changes for 2013 and 2014, including new W2 reporting requirements, the Summary of Benefits and Coverage, The Employer Mandate, The Individual Mandate, and The Exchange. Continue reading »
Obama’s FY14 Budget Proposal NOT Retirement Plan Friendly!
The Obama Administration’s recently released fiscal year 2014 budget contains several provisions that are less than advantageous as they relate to retirement plans. These provisions are by no means final, however, as Congress has yet to work its way through them.
The proposed budget contains two specific provisions that would greatly reduce the attractiveness of retirement plans to small businesses: Continue reading »
Fiscal Cliff Legislation Lets D.C. Empowerment Zone Incentives Expire
The “Fiscal Cliff” legislation (H.R. 8: American Taxpayer Relief Act of 2012) enacted by Congress earlier this month did not extend the tax benefits provided pursuant to Internal Revenue Code sections 1400 through 1400C with respect to District of Columbia Enterprise Zones (“DC Zones”). Although the legislation retroactively extended the Federal Empowerment Zone incentives for calendar years 2012 and 2013, the December 31, 2011 expiration date for the designation of certain DC Zones being eligible for empowerment zone designation was left unaddressed by the Fiscal Cliff legislation.
As a result, the following DC Zone incentives will no longer be available for tax years beginning on or after December 31, 2011: Continue reading »
Cloudy with a Chance of Sales Tax in the DC Metro Area
The taxation of cloud computing services is an evolving area of sales and use tax. Cloud computing, which includes a wide variety of service offerings, generally allows businesses the potential to reduce IT costs by outsourcing hardware and software maintenance and support. Still, remote access to software, or “software as a service” (SaaS), is only a small part of what is referred to as “cloud computing.” The term also includes offerings such as Continue reading »
Construction Contractor Tips to Prepare for Year End Financial Statement Audits
With the arrival of the New Year, it is also time for many construction contractors to begin planning and preparing for their annual financial audit. The importance of this preparation cannot be understated. Adequate planning and preparation will potentially decrease audit fees for your construction company, and it will save your staff valuable time throughout the audit process during a very busy time of the year. Listed below are some of the top ways to plan and prepare for your construction company’s annual audit.
New Roth Conversion Provisions in 401(k) Retirement Plans
The legislation to avoid the “Fiscal Cliff” did not spawn widespread retirement plan changes as many had feared. However, there is a minor change related to Roth conversions in eligible retirement plans. 401(k) plans that allowed for Roth 401(k) contributions also allowed for the conversion of participant accounts to Roth accounts, but only if the participant had a distributable event. Such events are typically termination of employment, reaching normal retirement age, reaching early retirement age, permanent disability, death, or attainment of age 59 ½. Under the new legislation, participants can Continue reading »
