State and local tax obligations present some of the most complex challenges that businesses must navigate. Constantly changing regulations and differing compliance requirements across numerous jurisdictions can make staying current with your various tax obligations challenging.
Anchin’s State & Local Tax Group (SALT) and Tax Controversy Services Group have developed a special expertise in state and local tax issues and can work with you to help lower your tax exposure and remove the administrative burden of compliance.
We work with a wide range of businesses from entrepreneurial startups to large public corporations to design solutions to best fit their business needs. Anchin keeps current on ongoing changes in tax laws and regulations in a wide variety of jurisdictions so we are well-positioned to create tax saving opportunities for our clients.
State and local tax planning services for a range of industries:
- Strategic corporate refund/opportunity review
- Federal audit changes/RAR services
- Responsible Party Defense
- Review sales tax compliance - state by state
- Sales tax reverse audits/refund studies
- Review company’s internal controls and procedures for sales/use tax
- Tax examinations, filing protests and answering correspondence
- Voluntary disclosure filing
- Penalty abatement and negotiations
- Evaluate filing requirements and nexus issues
- Penalty and interest abatement negotiations
- Deferred payment arrangements
- Due diligence
- Mergers and acquisitions planning
Considerations During the Pandemic
- Employee versus Independent Contractor Misclassification: A Costly Post-Pandemic MistakeJuly 22, 2021
As the U.S. economy continues to recover, many businesses are increasing employment to pre-pandemic levels. However, according to various surveys, job seekers across a variety of industries are now prioritizing flexible work arrangements, including part-time and telecommuting opportunities. There seems to be a strong sentiment against the more traditional “in-office, nine to five” career. While many businesses appear to be adapting to the workforce’s desires, these new employment models raise concerns with respect to employment classification, specifically employees versus independent contractors.
- Puerto Rico Act 60: How You Can Lower Your Federal and State Tax Rates Under the Resident Tax Incentive CodeJuly 12, 2021
The Tax Incentive Code, known as “Act 60”, provides tax exemptions to businesses and investors that relocate to, or are established in, Puerto Rico. The incentives are particularly attractive to U.S. citizens who move to Puerto Rico because they do not need a residency permit, their Puerto Rico income is exempt from U.S. federal and state income taxes and they get to keep benefits such as Medicare and Social Security. Furthermore, the Puerto Rico tax code mirrors the U.S. Internal Revenue Code, making the transition much easier for those who become bona fide residents of Puerto Rico.
- Can New York State’s Pass-Through Entity Tax Program Help Reduce your Overall Tax Burden?July 8, 2021
On April 19, 2021, New York Governor Andrew Cuomo signed the 2021-2022 budget bill into law. The budget supports through significant tax increases, the Governor's $311 billion infrastructure plan, which is the largest and the most expansive in New York State's history. One of the key favorable provisions of the law is a new, elective Pass-through Entity (“PTE”) Tax. This new tax is enacted as a work around to the $10,000 state and local tax (“SALT”) deduction limitation, which was implemented under the Tax Cuts and Jobs Act (“TCJA”). Since state income tax is imposed directly on the Pass-through Entity, the income tax paid is fully deductible by the entity for federal income tax purposes and not limited by the $10,000 cap, which does not apply to business entities. In addition, electing taxpayers provide their owners with a credit to be utilized on their New York State (“NYS”) income tax return equal to such owners’ appropriate share of the tax paid by the PTE.
- Caution: COVID-Era Remote Worker Tax Relief Coming to an EndJune 30, 2021
At the onset of the COVID-19 pandemic and subsequent shelter in place orders, many states extended temporary relief from state tax nexus and payroll withholding obligations to out-of-state employers with remote employees working within a state. While under normal circumstances, the physical presence of remote employees in a state often creates income and sales tax nexus and employer payroll withholding tax responsibilities, the relief provisions allowed companies to disregard the presence of remote workers in their state for these tax purposes. However, as the pandemic comes to a close in the United States, businesses should be aware that states will begin to roll back these exemptions, which were granted solely on the basis that they were temporary.
- Anchin: Personalized Accounting Services for Holistic GrowthJune 18, 2021
The COVID-19 pandemic has presented challenges to accounting firms and their clients, many of whom are still working on a strategy to combat this unprecedented situation. While CFOs and other finance professionals spent much of 2020 addressing the pandemic's hardships, in 2021 they will likely be shifting their focus toward implementing long-term plans to position their organizations for growth and profitability. Despite its toll on people and businesses, the pandemic has created an opportunity for accounting firm leaders to influence positive outcomes by reevaluating and adjusting their goals and executing wellthought-out strategies. As a result, advisory services are among the fastest-growing segments for firms such as Anchin, one of the country's leading accounting and advisory firms. Since the onset of the pandemic, Anchin’s team of professionals have made it a priority to assist their clients through COVID-19 related hardships including guiding clients through the transition to remote working, evaluating cash flow and costs, and providing them with continuous information and updates on the Paycheck Protection Program (PPP) and other incentives and programs.
- Can You Benefit from New Jersey’s New Emerge Program?June 9, 2021
On January 7, 2021, New Jersey passed the Economic Recovery Act of 2020 (the “Act”), which contains a comprehensive recovery package addressing the ongoing economic impact of the COVID-19 pandemic. Specifically, the Act includes over 15 different economic development programs incentivizing job creation, capital investment and community revitalization. Recently, the New Jersey Economic Development Authority (“NJEDA”) approved details regarding the Act’s new Emerge Program (the “Program”), a jobs-based tax credit program for businesses that invest private capital in the state and target priority industries. These tax credits are available for up to seven years.
- The Fiscal Year 2022 New York State Budget – The Benefits and Costs to YouApril 12, 2021
New York Governor Andrew M. Cuomo and legislative leaders have announced an agreement on the state’s fiscal year 2022 budget, which, among its various provisions, will significantly raise tax rates and make New York City the highest taxing jurisdiction in the country. The notable changes are discussed below, and it is important for taxpayers to consider how they may be impacted going forward.
- New York State’s Tax Increase: What High Earners Need to KnowApril 8, 2021
Taxes are going up for New York’s highest earners.
Legislation passed Wednesday raises income-tax rates on single filers with more than about $1.1 million of income and joint filers reporting more than about $2.2 million. The changes mean top earners in New York City will be subject to the highest combined local tax rate in the country.
- New Jersey Follows Federal Tax Treatment of PPP LoansFebruary 22, 2021
New Jersey Governor Phil Murphy and State Treasurer Elizabeth Maher Muoio have announced that federal Paycheck Protection Program (PPP) loans will receive the same beneficial tax treatment in New Jersey as they do at the federal level. Following the federal government’s lead, PPP loans will be tax exempt for New Jersey state income tax purposes, and those who received the loans can also deduct business expenses paid for with the money from these tax-exempt loans.
- State Tax Implications of PPP Expense Deductibility and Loan ForgivenessFebruary 18, 2021
The Paycheck Protection Program (PPP), created as part of the Coronavirus Aid, Relief and Economic Security (CARES) Act and extended under the Consolidated Appropriations Act of 2021, provided much-needed relief for businesses struggling to stay afloat during the COVID-19 pandemic. While the CARES Act specifically excluded forgiven loans from taxable income at the federal level, the deductibility of the associated expenses remained in question until the enactment of the Consolidated Appropriations Act which clarified the allowance of such deductions.
- New York Resident State Credits for Pass-Through Entity TaxesJanuary 7, 2021
With the release of IRS Notice 2020-75 permitting the deduction of state pass-through entity (PTE) tax payments, many taxpayers are considering electing into PTE tax regimes as a workaround for the $10,000 cap on state and local tax deductions on federal tax returns. To date, New Jersey, Maryland, Louisiana, Oklahoma, Rhode Island and Wisconsin have enacted elective PTE taxes. Connecticut is the only state with a mandatory PTE tax. A number of other states, including New York, are debating the enactment of PTE taxes in 2021.
- Reducing Your New Jersey Tax Liability with BAITDecember 9, 2020
The $10,000 federal limitation on the deductibility of state and local taxes, known as the State and Local Tax (SALT) deduction, continues to be a major concern for many taxpayers, particularly those in high-tax jurisdictions. To circumvent this cap, several states have introduced entity-level taxes on pass-through entities (PTEs), which ostensibly treat the entity tax as a deduction by the trade or business rather than an itemized deduction at the individual partner level, which would be subject to the SALT limitation. Individual partners, in turn, receive a credit for the entity-level taxes paid. Questions loomed regarding whether the Internal Revenue Service would respect such deductions until it released Notice 2020-75 in November, indicating that the deductions of these tax payments are in fact permitted. New Jersey joined the SALT workaround bandwagon this year by establishing its Business Alternative Income Tax (BAIT).
- Where Can You Find “Lost” Money in the Pandemic?December 8, 2020
The COVID-19 pandemic has caused financial hardships for many businesses and taxpayers. Shelter-in-place orders closed companies’ doors for months resulting in significant losses of revenue and job cuts. Businesses are now adapting to new ways of operating and are seeking alternative avenues to generate much-needed revenue. However, in doing so, many companies and taxpayers are overlooking a $40 billion cache of money that’s already theirs.
- Opportunity For Tax Savings: State and Local Pass-Through Entity Taxes Not Subject to the Federal Deduction CapNovember 12, 2020
Earlier this week, the Department of the Treasury and IRS announced that state and local taxes imposed at the entity level on pass-through entities are permitted as a federal tax deduction. Forthcoming proposed regulations will clarify that state and local income taxes imposed on and paid by a pass-through entity are allowed as a tax deduction by the pass-through entity in computing its taxable income. Such tax payments are not subject to the $10,000 state and local tax (SALT) deduction limitation on individual partners and shareholders who itemize deductions.
- Is Your Business Eligible for State and Local Tax Savings during the Pandemic?October 27, 2020
One of the looming state tax issues created by the COVID-19 pandemic is how businesses allocate their service revenues among states and localities in light of current telecommuting and shelter-in-place orders. Typically, state laws source service revenues using one of two basic approaches: cost of performance or market-based. Depending on which option a state utilizes, how these provisions are applied will have a significant impact on a business’ overall tax liability and could actually lead to state tax savings in 2020.
- Pandemic Planning: What Should Businesses with Remote Employees Know About State Taxes?October 14, 2020
With states of emergency and telecommuting stretching through more than half of 2020, businesses are facing serious concerns about state taxes. Below are some of the more significant factors businesses need to consider as they evaluate their state tax footprint for 2020 and beyond. Also discussed are recommended actions companies should adopt to help navigate their state tax compliance obligations. Uncertainty over state tax positions persists as the authorities continue to assess their fiscal responses to the pandemic. However, taxpayers should proactively prepare for whenever guidance is ultimately provided.
- What Does the New Jersey 2021 Fiscal Year Budget Mean for You? October 1, 2020
On Tuesday, September 29th, New Jersey Governor Phil Murphy signed a $32.7 billion budget into law, further increasing taxes on millionaires and businesses.
- What Is a Limited Liability Partnership?September 21, 2020
LLP STANDS FOR LIMITED liability partnership. As the name suggests, an LLP provides its members with a degree of liability protection, shielding them and their personal assets.
- New York State Announcement on June 15th Estimated Income Tax PaymentsJune 12, 2020
On the evening of June 11th, New York State came out with announcement N-20-8 which states that it will be treating the estimated payments made by individuals, corporations or fiduciaries on June 15th as the first quarterly installment previously due on April 15th, and the payment on July 15th as the second installment previously due on June 15th. New York State had not given any indication prior to this time that they were going to take this position.
- Key Tax Considerations When Deciding to Make a Pandemic Re-location into a Permanent Move May 28, 2020
Many of you have vacated your homes in the New York City area and other high-traffic areas in response to the COVID-19 outbreak. Now, phased re-openings and a slow return to normalcy bring a lot of questions about the end date for what was expected to be a short-term re-location. As a result, many of you are thinking of staying where you are and wondering if there could be tax benefits to doing so.
- NYS Sales Tax Filing and Payment Extension Deadline ApproachesMay 8, 2020
Quarterly and annual New York State sales tax vendors who were unable to file or pay March 20, 2020 sales tax returns due to the COVID-19 outbreak must file these returns and make payments by May 19, 2020. Some may be eligible to have penalties and interest waived, but penalty abatements must be submitted for approval and are not automatic.
- Important Reminder – Update Your Calendar For New Tax DatesApril 14, 2020
The COVID-19 pandemic has changed so much about our personal and financial lives. One item to keep in mind is that the Internal Revenue Service, along with most states, have changed the due date for filing income tax returns and paying your balances for 2019, as well as your 1st and 2nd quarter estimated tax payments for 2020.
- Introducing Anchin’s COVID-19 Resource TeamMarch 30, 2020
To assist you with evaluating the broad range of programs now available, we have established the Anchin COVID-19 Resource Team, a coordinated group of experienced professionals that will work alongside your engagement teams, in claiming the benefits you need to meet your cash flow, maintain your workforce and handle other critical challenges.
- Treasury Announces Additional Relief For Taxpayers Through Extension of April 15th Filing DeadlineMarch 20, 2020
Treasury Secretary Mnuchin announced today that the filing deadline for federal tax returns originally due April 15th will be extended 90 days until July 15th, 2020 as an additional step aimed at providing relief to taxpayers. This action followed a previous announcement that the deadline to make tax payments had been extended to July 15th.
- Treasury Relief Postpones Certain Tax PaymentsMarch 19, 2020
The IRS has released guidance related to the postponement of certain tax payments as relief to taxpayers during the Covid-19 outbreak. This measure provides one of the first of what will likely be several measures to improve the liquidity of businesses and individuals.
- New Jersey’s State and Local Tax (SALT) Cap OpportunityFebruary 13, 2020
On January 13, 2020, New Jersey enacted the Pass-Through Business Alternative Income Tax (the “NJPTBA tax”) Act, effective for tax years beginning on or after January 1, 2020. This represents a State and Local Tax (SALT) cap workaround (similar to legislation already in place in Connecticut), that provides an opportunity to workaround to the Federal state tax deduction limitation of $10,000 (the “SALT cap”) passed under the Tax Cuts and Jobs Act (TCJA) in late 2017.
- Westchester County Increases Sales and Use Tax RateJuly 29, 2019
Starting August 1, 2019, local sales and use tax in Westchester County, New York will increase by 1%, from 3% to 4%.
- Do You Know the Sales Tax Rules for the States in Your Supply Chain? If Not, It Could Be Costly. December 21, 2018
Retailers that operate in multiple tax jurisdictions across the U.S. are facing an increasingly complex and onerous landscape. While once they were able to trust customers to settle their own sales tax bill, the Supreme Court's decision in Wayfair vs. South Dakota now forces merchants to account for and collect the tax on every transaction, a bookkeeping nightmare for small businesses.
- Will the Increasing Focus on Raising Tax Revenue with Gross Receipts and Excise Taxes Impact You?November 7, 2018
Now privy to information from outside third parties, some states and localities are taking increasingly aggressive approaches in raising revenue with such taxes. Below, we profile
- Five Things to Consider Regarding a Second Residence in the Big AppleSeptember 27, 2018
New York can be a magical city, and many people dream of making the Big Apple their forever home. Yet for those that want to enjoy the city on a part-time basis, there are a number of things to consider to make sure the decision is appropriate. This piece highlights five.
- Congress Introduces New Sales Tax LegislationSeptember 21, 2018
Congressmen on both sides of the aisle recently introduced legislation to address the Supreme Court’s decision regarding sales tax and physical presence nexus in South Dakota versus Wayfair. The Wayfair decision allows states to require businesses to register and collect sales tax even though no physical presence in the state.
- Effective 10/1/18: Sales and Use Tax Collection Changes for Additional StatesSeptember 13, 2018
Since the U.S. Supreme Court’s recent ruling in South Dakota v Wayfair Inc., additional states have released guidance on the treatment of sales and use tax, effective 10/1/18.
- Evaluating the Use of the New York Charitable Gift Reserve Fund to Secure Tax DeductionsJuly 23, 2018
As a result of the federal Tax Cuts and Jobs Act, the maximum deduction for state and local income taxes combined with real estate taxes on the federal return will be limited to $10,000 for years beginning in 2018. In an attempt to mitigate the negative consequences of this lost deduction for New Yorkers, the recently passed New York Executive Budget has several provisions that provide potential relief.
- Effective 7/1/18: Sales and Use Tax Collection Changes for Vermont and KentuckyJuly 2, 2018
Since the U.S. Supreme Court’s recent overturning of Quill Corp. v. North Dakota, Vermont and Kentucky have released guidance on the treatment of sales and use tax, both of which went into effect on July 1, 2018.
- Supreme Court Opens Door to Taxation of Online SalesJune 26, 2018
In a much-anticipated ruling that confounded the expectations of many court watchers, the U.S. Supreme Court has given state and local governments the green light to impose sales taxes on out-of-state online sales. The 5-4 decision in South Dakota v. Wayfair, Inc. was met by cheers from brick-and-mortar retailers, who have long believed that the high court’s previous rulings on the issue disadvantaged them, as well as state governments that are eager to replenish their coffers.
- Supreme Court Overturns Significant Wide Reaching Tax RulingJune 21, 2018
In one of the most groundbreaking tax events in decades, the U.S. Supreme Court overturned Quill Corp. v. North Dakota, a 1992 decision pertaining to the collection of use tax. Now, retailers can be required to collect sales and use tax, even in states in which they lack a physical presence.
- Individual Income Tax Deductions under the 2017 Tax Reform Act February 16, 2018
The 2017 Tax Cuts and Jobs Act introduced some significant changes to the individual income tax structure. Income tax rate changes and income tax deduction changes will impact your overall tax liability. Here are some of the changes.
- South Dakota v. Wayfair Inc. May Significantly Change How Retailers Collect Sales TaxJanuary 17, 2018
It is no secret that there has been a dramatic change in the system of collection of sales tax in the United States in recent years, partially due to trends such as online shopping. A recent court case that could dramatically change the laws on sales tax and have a potentially significant impact on businesses and consumers is progressing through the judicial system.
- Tax Cuts and Jobs Act Offers Favorable Tax Breaks for Real Estate OwnersJanuary 3, 2018
The Tax Cuts and Jobs Act (TCJA), which was signed into law on December 22, offers the real estate industry a treasure trove of tax breaks. Overall, most Real Estate companies and owners will come out ahead under the new tax law, but there are a number of tax breaks that were eliminated. Here are the most important changes in the new law that will impact the real estate industry.
- Tax Cuts and Jobs Act Offers Favorable Tax Breaks for BusinessesDecember 28, 2017
The Tax Cuts and Jobs Act (TCJA), which was signed into law on December 22, contains a treasure trove of tax breaks for businesses. Overall, most companies and business owners will come out ahead under the new tax law, but there are a number of tax breaks that were eliminated or reduced to make room for other beneficial revisions. Here are the most important changes in the new law that will affect businesses and their owners.
- Tax Bill Impacts Service FirmsDecember 28, 2017
On December 22, President Trump signed into law the “Tax Cuts and Jobs Act of 2017” (TCJA). The bill contains many provisions effective in 2018 that will significantly impact professional and non-professional firms.
- New Tax Law Brings Big Changes for Individual TaxpayersDecember 26, 2017
On December 22nd, President Trump signed the Tax Cuts and Jobs Act of 2017 (“TCJA”) into law. It is the most sweeping federal tax legislation in more than three decades. While many of the new law’s provisions affect businesses, it also includes significant changes for individual taxpayers, most of which take effect for 2018 and expire after 2025. Here are some of the most notable changes.
- Federal tax bill boosts New York real estate, hurts home ownershipDecember 19, 2017
Anchin partner Marc Wieder discusses the federal tax bill, and how the cap of the State and Local Tax (SALT) deduction at $10,000, combined with a new mortgage interest rate deduction could have a deeply negative impact on the housing markets in New York City, Long Island and Westchester County suburbs.
- Tax Bill ReleasedDecember 18, 2017
Late Friday night, a written version of the Republican tax proposal was finally released. The bill represents a substantial revision of our country’s tax code.
- Tax Plan Moves ForwardDecember 14, 2017
The Senate and House conference committee made further progress on its tax reform plan.
- Senate Passes Tax BillDecember 5, 2017
The Senate voted and narrowly passed its version of tax reform legislation clearing another significant hurdle in the progress of changing our nation's tax system. There still remains significant differences between the House and Senate versions which will require reconciliation of the two bills.
- New York City Takes a Step Towards Tax Relief for Small Businesses in ManhattanDecember 1, 2017
The New York City Council passed a bill that will relieve many businesses in Manhattan of a portion of their tax expense.
- Domestic Employee Payroll: When Running a House is the Same as Running a BusinessNovember 30, 2017
When becoming a domestic employer, there are a number of factors to consider in order to be in compliance with labor and tax laws.
- Compare and Contrast the House and Senate Tax BillsNovember 14, 2017
Many of the House and Senate provisions are similar. For example, both plans would repeal the alternative minimum tax and retain the charitable contribution deduction. However, there are a number of key differences. Here’s a look at some of the most significant.
- Senate GOP Releases Tax Reform PlanNovember 14, 2017
The Senate released its long awaited tax reform proposal. While many similarities exist with the House bill many differences also exist. Here are a few observations.
- Republicans Finally Release Tax ReformNovember 2, 2017
Moments ago, House Republicans released their proposal for tax reform. Similar to prior announcements, this document lacks much of the details necessary for proper evaluation
- Sales and Use Tax Exemptions Extended for Certain Property and Service Purchases for Leased Commercial Office Space in Lower ManhattanSeptember 19, 2017
Amendments have been made to the Tax Law that will extend tax incentive opportunities for businesses that locate or relocate offices in lower Manhattan.
- The Government is Holding Millions in Unclaimed Retirement MoneyFebruary 7, 2017
Barry Weisman, Tax Partner, illustrates how searches in the wrong state can leave large retirement accounts unclaimed.
- Avoid Letting Two Homes Become One Big Problem at Tax TimeJanuary 31, 2017
Having a second home can be a source of joy and relaxation, yet it can also increase stress, especially to future tax bills if households are not careful.
- Recent Statutory Changes to the New York State Metropolitan Commuter Transportation Mobility Tax (“MCTMT”)January 13, 2015
For tax years beginning on or after January 1, 2015, there are significant filing and payment changes to the MCTMT which will affect many unincorporated businesses and self-employed individuals.
- New York State Conforms to the Market Based Sourcing Approach for the Sourcing of Receipts from Services and the Use of IntangiblesJanuary 6, 2015
For tax years beginning on or after January 1, 2015, receipts from services and intangibles will be sourced to where the customer receives the economic benefit and not where the service was performed. This is more commonly known as "market-based" sourcing of receipts.
- How Does Tax Reform Impact You?
6 Recent Tax Law Changes That Technology Companies Need to Know07/25/2019 Automatic Extension Available for Making Portability Election1/31/2019 What Should Businesses Know About Qualified Opportunity Zones?1/15/2019 How Can
- COVID-19 Update Center
The Anchin COVID-19 Update Center is available to simplify your access to critical financial information. It is updated regularly to supplement your communications with your
- Tax Ideas for a Booming IndustryMarch 20, 2017
The construction industry is alive and well in 2017. As a major force in New York and the greater US economy, it employs more than
- Don't Forget to Examine Your Company's State Research and Development CreditsJanuary 4, 2016
Yair Holtzman, Gleb Gorkhover, Michael Ganz and Matthew Bechtold of Anchin, Block & Anchin offer a state-by-state examination of the various state R&D credits and