My wife and I were talking at the dinner table last night about how much the cost of one year of college tuition would be in the year 2036. The year 2036 holds a special place in our heart, as it is the year that our three-month old son will (potentially) be leaving the nest for four (or more) years at an educational institution to prepare him for the “real world.” The numbers we were throwing around were so large they seemed laughable, but they may become reality in eighteen short years. Although the potential cost of college seems daunting for almost everyone, there is some help available for parents (or grandparents, aunts, uncles, or really anyone) that want to set aside money to be used for future education expenses. Some of that helps comes by the way of a 529 Plan.
In this two part series covering New York States' Response to the Federal Tax Reform, we will address the state's major goals and changes.
New York is the first of many high-tax states to pass changes in laws to combat the impact the TCJA will have on NY taxpayers. Under the Trump administrations tax overhaul, itemized deductions for state and local income, property and sales taxes are limited to $10,000 a year. The proposed tax reform for NY determines that limitations from the TCJA will cost NY taxpayers an additional $14.3 billion a year. Governor Cuomo has pushed through a plan at an attempt to shield NY state residents from this hike through the Executive Budget. Provided below is an outline of proposed tax reform for New York State:
All for-profit businesses are required to pay federal income taxes on their gross income. This is true even if a taxpayer is operating an illegal business. You might be asking yourself, "Why would an illegal business voluntarily pay taxes?" Well... what about the medical and adult recreational use marijuana businesses?
So you have hired a valuation professional to put a price tag on your business. Although you trust the valuation analyst, you may ask yourself how it is possible for anybody to put a dollar value on the blood, sweat, and tears that went in to starting and building your company? With all the information and complexities of your business, where does the analyst even begin? Business Valuation can sometimes be as much art as science, however, there are three primary methods that are generally used in the valuation world. A brief overview of each method is included below, to give you an idea of how a valuation professional will begin to determine value.
Will I benefit from the Tax Cuts and Jobs Act? Good question! The sweeping tax reform that was passed into legislation last year became effective January 1, 2018. Among the changes made by the law, that impacts virtually every taxpayer, were the repeal of the personal exemption, increase in the standard deduction, modification to itemized deductions and doubling of the child tax credit.