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2017 Year End Tax Planning Tips

December 6, 2017 Scott News Articles

Narelle MacKenzie was interviewed by San Diego’s KUSI 9 on year end tax planning tips in light of tax reform. Some of the items discussed were:

Deferring or accelerating income depending upon your expected tax rate for the year
Accelerating deductions for state income taxes since there will be no deduction in 2018
Accelerating your itemized deductions such as charitable contributions if you will be claiming the standard deduction next year
Accelerating alimony payments since under the House version of the tax reform bill there will be no income tax deduction in 2018.

She did not have time to cover the changes in the deductibility of mortgage interest, however it’s important to note that there will no deduction for interest on equity lines of credit; even if you are able to itemize your deductions. Please consult with your local CPA on your optimal year end tax planning.

There are also significant changes in the international tax area. Including potential US tax for foreign partners upon the sale of their interest US partnerships. Also an opportunity to rethink the location of Intellectual Partnership (IP”) and possibly migrating the IP back to the USA for a low effective tax rate. Additionally, even if your foreign operations did not throw off subpart F income, any accumulated earnings in your foreign corporations (if they are CFCs) will result in an income inclusion and US tax, based on the balance at January 1, 2018.

Please feel free to contact your CPA or Narelle MacKenzie for additional insights.

Additional Resources

Year End Tax Planning Tips – 2017

Unreimbursed Employee Expenses

2018 Tax Rate Tables – better or worse

Narelle MacKenzie Interview at Kusi News

April 12, 2017 Scott News Articles

Narelle MacKenzie was interviewed on Good Morning San Diego by Kusi News’s Carlos Amezcua. Watch the video here.

Americans are missing out on tax deductions

March 19, 2017 Scott News Articles

SAN DIEGO- Tax day is less than one month away. A local CPA says Americans are missing out on deductions. Some apply to people who claim the standard deduction and don’t itemize.

If you pay rent, you may be eligible for the California Nonrefundable Renter’s Credit. Single filers can are eligible for a $60 credit. Married couples that file together get $120. Did you move for a job last year? Even if you take the standard deduction and you didn’t itemize, you can deduct any moving cost not covered by your employer.

For those of you who do itemize, CPA and San Diego State University lecturer, Narelle Mackenzie says you’re allowed to deduct other work related expenses. “If you’re an employee and your employer doesn’t reimburse you for all your expenses that’s another example of where you can claim mileage. If you’re traveling away from home you can claim 50% of your meals.”

The CW6 – March 16, 2017 by Amy Dupont

Read Full Article Here

Charitable Donations Won’t Ease Tax on Oscar Swag for Most Celebrities

March 2, 2017 Scott Consulting

High-net-worth celebrities who think they can avoid paying the tax man by donating the goody bag’s contents to charity might be sorely disappointed when they realize how little they can actually deduct.

“They can make a charitable contribution, but the problem is charitable contributions are going to be limited to 50 percent of their adjusted gross income, and you have a phase-out for itemized deductions when your adjusted gross income exceeds certain values,” said Narelle MacKenzie, an accounting lecturer at San Diego State University’s Fowler College of Business Administration.
Bloomberg – Mar 1, 2017 / by Allyson Versprille

Read Full Article Here

How Oscar Celebs Can Cope With Taxes On ‘Swag Bags’: Tips For You Too

February 25, 2017 Scott Arts & Culture, Consulting

Narelle Mackenzie was a contributor to this recent Investor’s Business Daily article about the the tax pitfalls Hollywood’s A-listers face when receiving Oscar night swag-bags. The February 2017 article explored some of tax questions that might concern recipients of these gifts which could be valued up to $200,000 or more. Narelle provided some insights into how celebrities could manage their tax burden when receiving one of these pricy gifts.

Read the full article here.

The Panama Papers: What Is a Tax Haven?

April 20, 2016 Scott Thought Leadership

Narelle MacKenzie was quoted in a recent US News & Word Report article on The Panama Papers and tax havens. She provided context on what they are, who uses them, and their legitimate uses.

In the April 16th article, Narelle MacKenzie explained tax havens this way: “Simply put, a tax haven is generally a country with a low rate – or even a zero rate – of income tax” further adding “Countries considered tax havens also don’t typically reveal the financial accounts of foreign investors”

The article goes on to describe some of the different countries around the world that serve as tax havens, and explains that while tax havens can be a legitimate means of lessening ones tax burden; issues of legality occur when failing to disclose off-shore accounts to the IRS.

Read the full article here.

Why Washington is Tackling the Tax Inversion Problem All Wrong

December 1, 2015 Admin Thought Leadership

Narelle MacKenzie was recently quoted in Fortune.com’s article “Why Washington is Tackling the Tax Inversion Problem All Wrong”. In regards to corporate inversions, she argues that the more you lower the corporate tax rate, the less common inversions will become. “A 15% corporate tax rate would stop most inversions,” she says.

The full article is available here.

Is the U.S. Leaving Money on the Table with the Current Corporate Tax Structure?

October 22, 2015 Admin Specific Countries, Thought Leadership

WalletHub recently turned to some of the foremost experts in the fields of accounting and tax law in search of insights into the country’s current corporate tax system as well as potential fixes to it. You can check out the questions we posed as well as their responses below. They posed the following question to Narelle: “Is the U.S. leaving money on the table with the current corporate tax structure?” An excerpt of her response is below. You may also read Narelle’s full response online or download a copy of it.

Is the U.S. leaving money on the table with the current corporate tax structure?

There are a number of things that are globally uncompetitive about U.S. corporate income tax rates. Firstly, the U.S. has a double tax system whereby the profits earned by a company are taxed, and then they are taxed again in the hands of shareholders. It is really an internationally uncompetitive tax system. There are a number of ways to minimize double tax, and in the USA many CPAs/tax advisors have businesses established as a S corporation or use LLCs which are taxed as partnerships/sole proprietorships. However, this is not an option for U.S. public companies, as they must be C corporations. Remember, the majority of income taxes (federal and state) are paid by individuals. Read more online.

SDSU Aztecs Abroad: Accounting in Shanghai – Summer 2016

September 19, 2015 Admin School

SDSU Aztecs Abroad: Accounting in Shanghai studies the US federal taxation of individuals, including the interaction of the Chinese taxes for a US expat working in China.

Program Snapshot:
China is a growing area for US businesses, and US businesses send expatriates to China. How are these US expatriates taxed in the USA? What are the US and Chinese tax obligations on their earnings in the USA and China? The US taxes US citizens on a worldwide basis, so understanding the US taxation of individuals as covered in the Acctg 503 class will provide students with an edge in the global economy. Shanghai is one of the current shining business locations in China, as well as a great history of conducting global business trade.

Course:
The purpose and scope of the course is the US federal taxation of individuals, including income, deductions, credits, social security taxes, and property transactions. This course will have an international taxation component, providing the interaction of the tax system of China and the USA for a US person living in China (“US expat.”)

San Diego State University
CES Faculty-Led Programs
Summer
Shanghai, China

Course Dates: July 5-22, 2016
Dates Abroad: July 8-22, 2016
Price: $2,287

For additional details and to register, please visit the SDSU Aztecs Abroad database or click here to download the information.

ACCOUNTING 659: SEMINAR INTERNATIONAL TAX

August 22, 2015 Admin School

Enrollment is now open for ACCOUNTING 659: SEMINAR INTERNATIONAL TAX. People are able to enroll for this class through Open University.

The primary objective of the course is to help you understand the US International Tax rules. You will gain an in-depth understanding of the fundamentals of the US tax law in an international context and apply that understanding with international tax planning concepts. The focus of this course is the US federal income tax rules as it relates to international and cross-border transactions.

By the end of the course students should be able to:

Identify and explain key US international tax concepts.
Apply international tax concepts.
Perform international tax calculations.
Explain the federal constitutional and statutory limitations on federal taxation, and be familiar with some major judicial and statutory authorities.
Draw supportable conclusions regarding tax issues by using research skills (including accessing and interpreting sources of authoritative support) to identify and evaluate issues.
Apply oral and written communication skills to high quality professional presentations and group discussions.

ACCTG 659-01
FALL 2015
Instructor: Narelle E. MacKenzie CPA
Class Days: Wednesday
Class Times: 7pm-9.40pm
Class Location: GMCS 306
Office Hours Times: Wednesday 2pm-3.30pm
Office Hours Location: SSE2429
Units: Three (3)

View the syllabus.

Tax Savings of $750 Million. Contract Review resulted in indirect tax savings of $750 million over the life of the contract by utilizing exemptions, certificates, and where that was not possible, changing the Importer of Record to a related party.

Global Tax Savings of $20 Million. Tax savings accomplished through structured placement of assets that was tax free for US tax purposes but provided a step-up in basis for foreign country purposes.

Reduction of Taxes to $0. Identified a solution for a US joint venture with a US partner and a foreign partner, operating in a third country, which reduced US taxes for the foreign partner, on the foreign operation, to zero.