Explore the importance of developing a recovery plan so that organizations are prepared in the event of a cyber emergency.

As technology continues to evolve, so does the chance of cyber security attacks and threats. In order to protect your organization, you must draft a disaster recovery plan. This plan will play a major role in the event of any data breach to ensure there is an effective solution to confirming that your data is still secure and how to recover from a cyber attack. While this type of disaster cannot always be avoided, having a plan in place lessens the damage done to your organization. When you download this whitepaper, you’ll learn:

  • Why developing this plan is crucial to protecting your organization
  • The elements that make up a strong disaster recovery plan
  • How to prepare your organization and employees in the event of a cyber attack.

What’s meant by a “clean” set of books and records? It simply means that a company’s financial records are up-to-date, accurate, and organized. While the nature and scope of a firm’s books and records may differ amongst companies and across an industry, the importance of adequately maintaining books and records are of equal importance.

All too often, business owners become complacent in maintaining their company’s financial records. Owners turn their energies to other aspects of the business, such as sales and operations, and struggle with finding the time for this imperative function. 

Why is this so important? While there are many reasons to dedicate the time and resources to maintaining a “clean” set of books and records, there are two main benefits. 

First, up-to-date and accurate financial records contain a lot of information about a company’s operations, such as profitability, cash flow, and receivables from customers, to name a few. Such information is necessary to successfully manage operations and make informed, knowledgeable business decisions. Second, a “clean” set of books and records can make a company more valuable and more attractive to prospective buyers. The condition of a company’s books and records are a direct reflection of the ongoing condition of a business. This is very similar to the curbside appeal of a piece of property or home.

Some other reasons to maintain a “clean” set of books and records include meeting tax filing requirements, assisting with business plans, and providing the ability to perform year-end tax planning to help plan for and potentially reduce income taxes. While maintaining a “clean” set of books and records may not be the most exciting aspect of running a business, the benefits far exceed the detriment of not doing so.

DiSanto, Priest & Co.’s experienced team of professionals can assist you in realizing the value of having a “clean” set of books and records and can help you achieve this goal. Call us at (401) 921-2000 or submit our contact form to get started. 

Discover the importance of performing due diligence on outside organizations you partner with in order to protect your business from data and security breaches.

Is your organization protected from and prepared for a data security breach in the event one occurs? While the immediate answer may be “yes”, ensuring that all vendors and subservice partners are also prepared is a crucial step. While doing due diligence on these partners is a typical part of vetting out a new partner initially, many organizations stop there. When you download this whitepaper you’ll learn:

  • Why continuous due diligence on partners is critical to your data security
  • How and why documenting this due diligence is beneficial to your organization
  • How DiSanto, Priest & Co. can assist in exploring these options for you in order to ensure your organization is fully protected

If you’re a commercial real estate investor, you may be aware of the complex rules in a Section 1031 Exchange, also known as a like-kind exchange. Our previously published blog post outlines the guidelines on this federal tax regulation. Many states follow the federal tax code and allow for the deferral of state income tax for like-kind exchanges; however, like-kind exchanges occurring between properties located in different states may have additional state tax implications to consider.

Some states require non-resident withholdings on real estate transactions that occur when an investor lives outside of the state. A handful of states California, Massachusetts, Montana, and Oregon have a “claw back” provision, allowing them to tax the gain on the property sale when the deferred gain originated from a property exchange located in their state. For example, if an investor sold a property in Massachusetts and purchased a replacement property in Florida, when the Florida property sells, Massachusetts may “claw back” and impose their state income tax on the gain.

Some of the states with the “claw back” provision have passed bills that require certain tax forms be filed along with a yearly tax return when doing a like-kind exchange. In California, for example, the bill “California AB 92” requires annual information reporting for taxpayers that claim non-recognition of gain or loss for like-kind exchanges with property outside of California. Form 3840 needs to be filed for 1031 exchange recognition, even if no tax return is required in California until the property is ultimately sold.

If you own investment properties in multiple states and have taken advantage of the 1031 Exchange, call us at (401) 921-2000 or submit our contact form to get started. We’re more than happy to assist you in determining state filing requirements.

Learn why it’s critical to understand the value of your business and about the four different valuation models for accessing what your business is worth.

Often, the largest asset in a business owner’s portfolio is in fact the business. Yet many business owners don’t know the value of their businesses.

Here’s what you can expect to gain by downloading this white paper:

  • Learn why business owners need to understand the value of their business
  • Understand what internal and external factors are a driving force in understanding value
  • Gain an understanding of the four different business valuation models
  • Explore the different levels of value and how each level impacts your business

Lastly, understand how to identify the right business valuator for you. DiSanto, Priest & Co. is here to guide all of your business valuation needs and answer your specific questions.

The Internal Revenue Code of 1954 included Section 174 which allowed businesses the option to either expense research and development (R&D) related expenses in the year those costs were incurred, or amortize these costs over a period of up to sixty months. Through the next sixty-plus years, not much changed in relation to this standard. When the Tax Cuts and Jobs Act of 2017 was passed, Congress amended this standard by requiring that starting in January of 2022 businesses would no longer be able to deduct R&D expenses in the year they were incurred. Rather, as of this date businesses became required to amortize these costs, in most cases over five years. As for the R&D tax credit, the calculations with respect to this have not changed.

This change to Section 174 could cause significant reductions in cash flow for companies related to the payment of tax, creating some serious concern for small business owners. In the larger global picture, this change can also affect both the economy and jobs creation and retention. With these effects in mind, companies began urging Congress to pass legislation to amend this change prior to the 2022 year-end filing season, however no such amendments have been made as of the date of this writing, which has created great uncertainty and angst among both taxpayers and advisors regarding tax planning and tax return preparation. A bipartisan group of legislators sponsored a bill that was introduced in April (entitled the “American Innovation and R&D Competitiveness Act”) that would repeal the currently required R&D amortization and restore expensing of R&D costs as incurred retroactive to January 2022. Additionally, this proposed legislation would also enhance the research tax credit.

These proposed legislative changes aren’t guaranteed, continuing to leave taxpayers with many unanswered questions when filing their 2022 tax returns. It is hopeful that there will be some additional guidance by late summer 2023.

As a firm it has been our best practice that any taxpayer who may be impacted by Section 174 extend their tax return filings, thus allowing this proposed legislation to be debated and hopefully enacted. We, as a firm, remain abreast of these legislative proposals and remain ready to implement the Section 174 legislative change should the bipartisan bill be adopted. 

For more information on tax policy changes, call us at (401) 921-2000 or submit our contact form to get started.

Do you have a data security plan for your organization? Understand data security recuirements and how to protect your business.

Start by asking yourself if you have a security plan for your organization. If you do, how can you be sure how strong that plan is? If you don’t, one will need to be created in order to follow the fourth amendment right of consumers which establishes the freedom from “unreasonable search and seizure”. Ensuring your organization has a security plan allows you to protect your data, specifically private data and your business as a whole. In downloading this whitepaper, you’ll explore:

  • What a good security plan contains and the five steps it takes to achieve this
  • Examples of threats to your organization
  • How to develop a plan to understand the characteristics of your organization in order to protect it

By working with DiSanto, Priest & Co., you’ll work with experts that know how to build a strong security plan while evaluating any risks.

With the passage of the Inflation Reduction Act in August of 2022, several changes to the tax laws have been made in response to green initiatives pushed forth by the legislative and executive branches of government. One of these new guidelines is a change to the Energy-Efficient Commercial Buildings tax deduction, also known as the Section 179D tax deduction, which originally took effect in 2006. The tax deduction was made permanent in 2020 through legislation, and for calendar year 2023, has been incentivized further with the Inflation Reduction Act.

Section 179D is primarily comprised of three different sections of improvements: building envelope, HVAC, and lighting. To qualify for the tax deduction, the improvements must meet ASHRAE standards and be certified by a qualified individual sanctioned by the IRS. If the plans are to “retrofit” an already existing building, then the building must be located within the United States and be at least five years old at the time of the retrofit planning.

For 2023, the scope and value of the tax deduction will be increased, allowing for a greater deduction amount along with a lower bar for entry for some eligible taxpayers. The new act has made three meaningful changes to Section 179D:

  1. Modifying the efficiency standard from 50% down to 25%,
  2. Altering the maximum allowable deduction per square foot, and
  3. An alternate election deduction for energy efficient retrofitting.

The new law aims to improve building energy efficiency by a minimum of 25%, but any improvements in efficiency over the 25% but not exceeding a credit rate of $5.00 per square foot will increase the benefit for the taxpayer. The new law also allows for taxpayers to take the tax deduction in the year the retrofitting plan is solidified into a qualified retrofit plan, opting for an earlier benefit than previously allowed.

Finally, tax-exempt entities are also allowed to allocate the credit to the person primarily responsible for designing the property in lieu of the ownership of the property, which will give tax-exempt entities an effective discount.

For more information on this and other energy tax incentives, give us a call at (401)-921-2000 or fill out our online contact us form to get started.

Learn what a cost segregation analysis does for commercial property owners and the impact it can have on your business.

Business and property owners are often tasked with reviewing depreciation and cash flow on commercial properties. However, it is crucial to understand what cost segregation means and how it impacts commercial property. While many can perform a cost segregation analysis, the analysis most be both accurate and well-documented.

By downloading this whitepaper, you’ll:

  • Learn different business models and see examples of how DiSanto, Priest & Co. has helped clients achieve quality cost segregation benefits
  • Understand if your business can benefit from performing a quality cost segregation analysis

If you’e looking to perform a high-quality cost segregation analysis, DiSanto, Priest & Co. are experts in identifying the cash benefits when performing this audit.

The Probate and Family Courts require the completion of a financial statement; this financial statement is required in all matters involving a marital dissolution (divorce), support (alimony and child), and other financial matters.

Why is this document so important? It is extremely important for a few reasons:

  • This document will become part of a permanent record;
  • This document will be used as a benchmark for future support modifications;
  • This document will be used to divide all marital assets; absent extraordinary circumstances, the division of marital assets is a FINAL distribution, which cannot be modified or changed.

This document will be used to decide a divorcing individual’s financial future; therefore, it requires the proper time and attention to make certain the information is accurate and presented in the most appropriate manner. This document is signed under the penalties of perjury that the information is complete, true, and accurate.

The amount of an individual’s annual income before taxes determines if a short form (less than $75,000) or a long form (more than $75,000) financial statement needs to be prepared. If an individual is self-employed or has rental property additional forms (Schedule A and Schedule B) are required.

In my years of working in family law, I have reviewed and prepared numerous financial statements. Some of the repeated mistakes that are often observed include the following:

  • Weekly v. Monthly Figures
    • As one navigates through the financial statement pages, there are pages that request weekly figures and other pages that request monthly figures. Special attention should be given to ensure that the proper figure is reported.
  • Self-Employment Income (Schedule A)
    • There is confusion surrounding the term “self-employment.” Based upon my experience as a Certified Public Accountant and a litigation support professional, it is my belief that the Schedule A should only be utilized in matters that involve a sole-proprietorship (tax form Schedule C of Form 1040) or a partner of a partnership (Form 1065). Generally, self-employed individuals must pay self-employment tax; self-employment tax consists of Social Security and Medicare tax primarily for individuals who work for themselves.
    • Therefore, the Self-Employment Income reported on Schedule A should NOT be utilized for business owners that are S-corporations, even though such individuals may consider themselves to be “self-employed” due to the fact that they are a business owner. The determining factor is not if you own the business, but how the business’ income is taxed to the individual and whether such income is subject to self-employment tax.
    • It is worth noting that Schedule A uses mostly monthly figures, but it also includes a line item that is weekly (“weekly expenses”). Again, close attention is required in accurately completing said schedule.

Accurately reflecting an individual’s financial position along with one’s income and expenses can be complex, especially when there are multiple sources of income and business interests are involved. DiSanto, Priest & Co. has the experience and expertise to assist in preparing this very important document, so let our trained professionals help you and your clients prepare an accurate, well thought-out financial statement.

If you have any questions, please reach out to Pam Oliver via email, give us a call at (401) 921-2000, or fill out our online contact us form.