Last week, I caught up with an old friend who was in town for a conference. We hadn’t seen each other in person since 2017 and had only exchanged a few emails since then. We spent hours over food and drinks catching up on our jobs, families, mutual friends, the state of the world, and said our goodbyes only when the restaurant staff started closing the place around us.
It got me thinking about how professional conferences offer a chance to reconnect with friends and colleagues, both in your profession and out of it. Conferences sponsored by the Society of Professional Journalists have given me both a professional network and longtime friends. I don’t think I would’ve ever had a chance to visit and enjoy Seattle, Little Rock, San Diego, Dallas, or Atlanta if SPJ hadn’t had meetings there.
As we continue emerging from the pandemic, in-person professional conferences are ramping up. Starting today, the Tax Executives Institute is hosting its midyear conference in Washington, D.C. In May, the American Bar Association’s Tax Section, National Tax Association, and National Association of Enrolled Agents also will meet in the nation’s capital. These are tremendous opportunities to take a break from the daily grind, to recharge and remind yourself that what you do matters.
At Bloomberg Tax, we work to keep tax professionals motivated all year long with thoughtful news analysis and insights, sharp commentary, profiles of practitioners, and more. We offer a chance to connect in between conferences through our social media sites, especially The Exchange on LinkedIn. Stop by and say hello—registration is free, there’s no travel expense, and we’re always glad to see you.
The Exchange—It’s where great ideas intersect.
—Rebecca Baker
Quick Trivia
What US city hosts the most conventions and professional meetings?
Answer at the bottom.
Corporate Insights
The rules surrounding “wet signatures"—those signed with pen and ink—has created confusion for corporations submitting certain forms to the IRS. Greenberg Glusker’s Zachary M. Nolan, Sally C. James, and Michael Wiener examine existing guidance to clarify the rules for satisfying the agency’s original signature requirements to file an S or QSub election.
Companies are struggling to calculate research and experimental expenditures under changes made to Section 174 of the tax code. EY’s Cate Stewart and Alexa Claybon discuss how businesses can identify and quantify costs subject to Section 174 capitalization requirements.
Special purpose acquisition companies might want to take a proactive approach to mitigating tax-related risks, especially as some auditors are refusing to sign off on a SPAC audit unless nexus study conclusions are disclosed in the financial statements, say Riveron’s Mary Montague, Anne Heffington, and Ryan Gamble.
State Insights
A plan to gradually phase out Kentucky’s state and local tax on bourbon, and any other distilled spirit, is moving forward but meeting resistance along the way. Attorneys Mark F. Sommer and Elizabeth M. Ethington of Frost Brown Todd discuss the history and impact of the tax, as well as the legislation to end it.
California’s wealth tax proposal is unlikely to pass, thanks in part to Gov. Gavin Newsom’s opposition, but ultrawealthy taxpayers should be wary of what it portends, says Colony Group’s Michael Nathanson.
Federal Insights
Marcum LLP’s Ariana N. Warren explains how leveraging debt can earn passive income, using an example of a nonprofit that purchases a building while earning rental income from it, and how to accurately calculate debt-financed income to report and pay tax on unrelated business income.
Hiring an outside vendor to handle unclaimed property compliance can reduce costs and reporting errors. Baker Tilly’s Cathleen Bucholtz and Michelle Moloian break down four factors—availability of resources, expertise, cost, and buyer stress—that can help companies decide whether to outsource the task or assign it to their tax department.
Global Insights
Eloise Walker of Pinsent Masons LLP explains the tax considerations and some attractive exemptions that apply when using a UK holding company to hold shares in other companies in the UK or overseas.
The Italian Budget Law recently amended the definition of permanent establishment, introducing a new exemption for asset managers. Giuliana Polacco of Bird & Bird looks at the new provision and the conditions that have to be met to take advantage of the tax benefits available.
Commentary
US multinational companies that perform research and development both at home and abroad are being penalized through the forced capitalization of their R&D expenses—and by a loss of foreign tax credits from jurisdictions where refundable tax credits are available, says Bridget Goutopoulos of Charles River Laboratories.
With a Democratic president and a Republican speaker of the House, the path for bipartisan reform is narrow. But Washington would be smart to learn lessons from other countries’ tax mistakes and find common ground, says Daniel Bunn of the Tax Foundation.
A Closer Look
In what may be a silver lining for most trial lawyers, the IRS’ Generic Legal Advice Memorandum has provided a playbook of what to avoid and why when deferring tax on contingent fees, says Structured Consulting’s Jeremy Babener in our latest installment of “A Closer Look.”
Columnists
A recent study of 16 African nations’ tax systems concluded there was little concern for reducing gender inequality. Those who drive a broad gender justice agenda and those who advance the gender tax agenda may find common ground in analogous struggles—for US civil rights and for African anti-colonial independence, Don Griswold writes.
Spotlight
Our Spotlight series highlights the careers and lives of tax professionals around the world. This week’s Spotlight is on Van Carlson, the founder and CEO of SRA 831(b) Admin, a strategic risk alternatives company in Idaho that administers 831(b) plans, which allow businesses to set aside tax-deferred funds for uninsured or underinsured risks.
News Roundup
It’s been another busy week in tax news from state capitals to Washington. Here are some stories you might have missed from our Bloomberg Tax news team.
*Note: Your Bloomberg Tax login will be required to access Tax News.
- Experienced analysts combing through the financial statements of now-collapsed Silicon Valley Bank could have told that a chunk of the bank’s assets was underwater, if they had dug deeply enough to figure it out.
- KPMG LLP has drawn criticism for giving Signature Bank a clean audit opinion on March 1, just 11 days before regulators shut down the bank after a run by depositors. Here’s another wrinkle: The ties between Signature and KPMG run deep, with the bank’s top leaders and some board members having previously worked at the Big Four accounting firm.
- Policy makers in a handful of states are seeing an opportune moment to adjust their personal income tax brackets to inflation as the financial stress of housing costs and high grocery bills continues.
- The GOP is starting to take aim at energy tax provisions from last year’s tax-and-climate law, advancing a bill to repeal a charge on methane emissions they say brings the EPA into the “tax collection business.”
- The Employee Retention Credit, a pandemic-era tax credit, is causing handwringing among some tax practitioners helping their clients file amended income tax returns for the 2020 and 2021 tax years.
Our Wish List
What’s on our Bloomberg Tax Insights wish list right now? For March, we want to know how you’re getting through the busy tax season. It can be anything from ways to relieve stress to advice on managing corporate clients. What changes in the tax code are affecting partnerships and S corps? And what can tax professionals do today to set themselves up for an easier busy season in 2024?
Our Insights articles—about 1,000 words—are written by tax professionals offering expert analysis on current tax practice and policy issues, tax trends and topics, and tax and accounting firm practice and management. If you have an interesting, never-published article for publication, we’d love to hear about it. You can contact our Insights team at TaxInsights@bloombergindustry.com.
Our Team
We talk about tax a lot. But there’s much more that you might hear us talking about if you popped into one of our Teams meetings. Here’s a quick look at what some of us are watching, reading, and listening to this week:
Watching:
- Rebecca Baker (Editor-at-Large, Insights and Commentary, Bloomberg Tax): “Delicious,” a film on Amazon Prime about how a cook who was fired from the palace of Versailles created the first modern restaurant in the late 1700s. The story is fiction, and it’s in French, but watch it with subtitles and get swept away by the characters, sharp writing, and amazing food prep sequences.
- Maria Menezes (Practice Lead, International Tax, Bloomberg Tax): “The Gold,” on BBC 1 in the UK, based on the Brink’s-Mat bullion robbery in 1983. It’s a slick drama, but the best bit is the trip down memory lane—1980s cars and clothing, and it’s very London.
Reading:
- Andrew Leahey (Columnist, Insights and Commentary, Bloomberg Tax): “The Search for the Green River Killer.” So far, it’s great. I hope they catch this guy—he sounds like a doozy.
- Melanie Cohen (Senior Content Editor, Insights and Commentary, Bloomberg Tax): “The Dictionary of Lost Words” by Pip Williams. It’s a novelization of the origins of the Oxford English Dictionary and takes place during the women’s suffrage movement.
Listening:
- Jessie Kamens (Editor-at-Large, Insights and Commentary, Bloomberg Law): I’m listening to a fun podcast that will have a new season shortly called “Normal Gossip.” Listeners send in their anonymized gossip and the host and a guest deliciously unwind the stories and lightly philosophize about them.
Save the Date
Learn how to find and develop the talents of your employees by joining Bloomberg Tax and Bloomberg Law Insights and Commentary teams on March 29 from noon to 1 p.m. ET for “How to Develop Hidden Talent in Your Organization,” part of our free virtual Lunch & Learn series.
Nimesh Patel, the chief diversity, equity, and inclusion officer at Akin Gump Strauss Hauer & Feld, and Don Smith, the chief talent and inclusion officer at Crowell & Moring, will provide strategies that they’ve found to be successful. Check our homepage, The Exchange, later this week for details about how to log in.
Quick Trivia Answer
With more than 10.5 million square feet of convention and meeting space, Las Vegas hosts nearly 60 of the 200 largest conventions and 20,000 meetings annually.
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