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News, Articles & Resources

Category: Tax Planning & Compliance

New Jersey State and Local Tax (SALT) Deduction Planning Opportunity

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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…

Estate of Lorraine M. Kelley – Important Lessons for Paying Estate Taxes on Time!

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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

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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

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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…

Governor Murphy’s Revised Fiscal Year 2021 Budget Proposal Includes Tax Increases

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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…

New Jersey Sales Tax and Surcharges for COVID-19

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The New Jersey Division of Taxation issued a notice on the taxation of surcharges for COVID-19 precaution and prevention costs. Some sellers are imposing additional fees on customer invoices for COVID-19 related cost. These additional charges may be termed a COVID-19 Fee, Coronavirus Fee, PPE Fee, Sanitation Fee, Cleaning Fee…

Estate tax planning in 2020, it’s deja vu all over again! Time to consider gifting strategies in some cases

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Authored by Glenn A. Henkel and Samantha Heaton Recent developments with the coronavirus have caused some proactive and wealthy clients to consider whether tax law changes may create an increased tax burden in the future.  As a result, some are revisiting the tax rules and determining whether immediate action is…

Paying your Taxes in the Time of COVID

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The IRS recently issued Fact Sheet 2020-10 to remind taxpayers that they “have a variety of options to consider when paying federal taxes.” Due to the COVID-19 pandemic, the filing deadline and tax payment due date was extended from April 15, 2020, to July 15, 2020. Taxpayers filing Form 1040…

Estate and Trust Income Tax Return Reporting Changes

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Authored by Michael Rios (summer law clerk) and Joseph T. Kenney, Esq.  On May 11, 2020, the United States Treasury published proposed regulations (“Prop. Regs.”)  (REG-113295-18) under the Tax Cuts and Jobs Act of 2017 (TCJA) related to the deductibility of certain expenses incurred by estates and non-grantor trusts. The Prop….

Long Awaited “Retail Glitch” Technical Correction

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The Tax Cuts and Jobs Act (“TCJA”) expanded the bonus depreciation provision in I.R.C. Section 168(k) from fifty (50%) percent to one hundred (100%) percent.  Unfortunately, Congress failed to assign qualified improvement property a fifteen (15) year recovery period when drafting the TCJA, rendering qualified improvement property ineligible for bonus…

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