Employee Retention Credit
The Coronavirus Aid, Relief, and Economic Security (“CARES”) Act incentivized employee retention by offering a payroll tax credit equal to fifty (50%) percent of qualified wages (wages, including qualified health plan expenses allocable to the wages) paid by eligible employers during the period from March 13, 2020, to December 31,…
Deductibility of Expenses Paid by a Paycheck Protection Program Loan
The Coronavirus Aid, Relief and Economic Security Act[1] (the “CARES Act”) was signed into law on March 27, 2020. The CARES Act was intended to provide relief for individuals and businesses that have been negatively impacted by the coronavirus pandemic. One of the most significant aspects of the CARES Act…
Required Minimum Distributions – Life Expectancy and Distribution Tables Updated
On November 12, 2020, the Internal Revenue Service issued Final Regulations providing guidance relating to the life expectancy and distribution tables that are used to calculate required minimum distributions (“RMDs”) from qualified retirement plans, individual retirement accounts and annuities and certain other tax favored employer provided retirement accounts. The new…
New Jersey State and Local Tax (SALT) Deduction Planning Opportunity
In January 2020, New Jersey Governor Phil Murphy signed legislation creating the Business Alternative Income Tax (BAIT). Effective for income tax years beginning on or after January 1, 2020, the legislation allows New Jersey pass-through entities (PTEs) to pay and deduct income tax at the entity level. The legislation provides…
New Jersey Doctrine of Probable Intent further clarified for charitable gifts
What happens if I make a gift to a charity under my estate plan and the charity goes away? Many clients make charitable bequest under their estate plan. A common question of those clients is what if the charity isn’t around when I pass? New Jersey and most states use…
Estate of Lorraine M. Kelley – Important Lessons for Paying Estate Taxes on Time!
The Estate of Lorraine M. Kelley never paid the estate taxes due despite many years elapsing and those funds passing through a second estate and multiple executors. U.S. v. Estate of Kelley, et al., 126 AFTR 2d 2020-6605, (DC NJ), 10/22/2020. Lorraine M. Kelley died on December 30, 2003. The…
IRS Allows Pass-Through Entity Workarounds to SALT Deduction Limitation
In Notice 2020-75, the IRS announced that the Department of the Treasury and the IRS intend to issue proposed regulations to clarify that state and local income taxes imposed on and paid by a partnership or an S corporation on its income are allowed as a deduction by the partnership…
New Jersey Budget Passage Includes Additional Income Taxes on Individuals with Taxable Income over $1 Million
On September 29, 2020, Gov. Phil Murphy signed a budget for revised fiscal year 2021. The budget includes $32.7 billion in state funds and appropriation of 13.8 billion in federal funds. The revised fiscal year begins October 1, 2020, due to the extension of fiscal year 2020 during the coronavirus…
New Jersey Supreme Court tackles issue of real estate taxation of private businesses on public properties
Gourmet Dining, LLC, is a “for-profit” business entity that had entered into a management agreement with Kean University to operate a “high-end” restaurant called “Ursino” on Kean University property. The Gourmet Dining business is on University property and, as a state school, it is operated on property owned by the…
Governor Murphy’s Revised Fiscal Year 2021 Budget Proposal Includes Tax Increases
On August 25, 2020, Governor Murphy released his revised budget proposal for Fiscal Year 2021 (FY 2021). The proposal includes tax policy changes estimated to yield just over a billion dollars for the nine-month FY 2021 period, including: Imposing the millionaire’s tax on all income above $1 million; Permanently incorporating…