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Accounting, auditing, tax and advisory services for
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Businesses
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Nonprofit organizations
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Successful Individuals
**What's New**
How
NOT to buy a business
[August 2010]
Owning your
own business can be both exciting and
rewarding. However, while you might feel
comfortable operating the business, you
probably will benefit from professional
guidance during the acquisition process.
This article will give you an opportunity to
learn from the mistakes of another.
When Wages are NOT FICA
Wages
[June
2010]
Recently a U.S.
District Court found that certain severance
payments were not taxable for purposes of FICA
taxation. The ruling conflicts with IRS
Publication 15 (Circular E), Employer’s
Tax Guide, wherein it specifically indicates
that severance pay is taxable for FICA purposes.
Employers, Beware of Hidden Limits in New tax
Credits
[April
2010]
Under the new
health care legislation recently signed into law,
certain small businesses and tax-exempt
organizations that provide health insurance coverage
to their employees will qualify for a new tax
credit. The credit is designed to encourage small
employers to begin to offer health insurance
coverage to employees or maintain their current
coverage. However, the law is more complicated than
advertised.
Tax Compliance of S Corporations
[January
2010]
In
light of the report and surging federal budget deficits,
S Corporation shareholders may look forward to new
legislation and additional oversight by the IRS.
Accrual basis
taxpayer forced to use cash method of accounting
[December
2009]
The Office
of Chief Counsel of the IRS recently issued a memorandum
that established the timing of a tax deduction for
certain bonuses earned by employees of an accrual basis
corporate employer. In general, the IRS
effectively denied the deduction of an accrual basis
taxpayer’s bonus obligations until the bonuses were actually paid
to the employees.
Connecticut Outlook Revised by Moody's
[October
2009]
Moody's
Investors Service has revised the outlook on the State
of Connecticut's general obligation bonds to "negative."
The negative outlook reflects the choices made to
address the state's biennial 2010-2011 budget gaps as
well as the shortfall for fiscal 2009. According
to the report issued by the rating agency, the magnitude
of the recent actions taken to balance the budget will
likely cause Connecticut to struggle more than other
states to achieve structural budget balance. Read
the full report issued by Moody's.
OIG Study Finds
Medicare Paid Twice for Ambulance Transportation
[September 2009]
The OIG concluded that
the Medicare program paid twice for ambulance
transportation: once to the SNF under the Part A
prospective payment system and again to the ambulance
supplier under Part B. The
government expects
to recover more than $12 million in overpayments.
A win for
taxpayers
[August 2009]
Setting
aside the contention that single member LLCs are
“disregarded entities” the court ruled that with regard
to the determination of estate and gift taxes, such
entities may be used to secure valuation discounts which
can lower or eliminate all related taxes.
FY 10 Medicare
Rates for Connecticut
SNFs
[August 2009]
On August 1, 2009, CMS
issued its final rule on Medicare payments to skilled
nursing facilities (SNFs), beginning October 1, 2009.
The final rule recalibrates the case-mix adjustments
used to establish each of the 53 different payment
rates. As a result, payments to SNFs would be reduced
nationally by about $1.05 billion in FY 2010.
Connecticut Charities can Reduce Audit Fees
[July 2009]
Tight
budgets call for creative ways to save money. Audit
fees should not be immune to such fiscal scrutiny.
Indeed, while the auditor should never compromise his or
her audit standards, all audits should be performed as
efficiently as possible. Luckily, in Connecticut,
charities have the ability to reduce audit fees and
still comply with the state’s registration
requirements. However, there are tradeoffs.
FASB Issues New Guidance on Nonprofit Mergers and
Acquisitions
[July 2009]
The
Financial Accounting Standards Board (FASB) recently
issued Statement Number 164 to provide guidance on the
accounting associated with a combination of a nonprofit
entity with one or more other nonprofit entities,
businesses, or nonprofit activities. Many mergers and
acquisitions by nonprofit entities do not involve a
payment of consideration. In other words, many mergers
and acquisitions by nonprofit organizations are not fair
value exchanges but rather are nonreciprocal transfers.
The FASB felt that that difference contributed
significantly to the requirement that different
accounting methods apply to a merger of nonprofit
organizations and an acquisition by a nonprofit entity.
The Codification – a major restructuring of U.S. GAAP
[June 2009]
Current U.S.
GAAP is dispersed, unorganized and confusing. However,
things are about to change. Effective July 1, 2009 GAAP, as
it has been known for the last 50 plus years, will be
restructured and codified into a single source called the
“Codification.” On that date the Codification will
supersede all then-existing non-SEC accounting and reporting
standards – if it’s not in the Codification, it will not be
authoritative.
CMS Proposes Major Changes to SNF
Medicare Rates
[May 2009]
On May 1,
2009, CMS issued a proposal that would change Medicare
payment rates for skilled nursing facilities beginning
October 1, 2009. For Connecticut, most rates would
decrease. For FY11, CMS has also proposed the
introduction of RUGS IV along with other changes that
would adversely influence SNF payments.
Ensuring Compliance by
Tax Exempt Non-filers
[April 2009]
Prompted
by the Inspector General, the IRS is planning additional
enforcement initiatives to ensure compliance with filing
requirements by certain nonprofit organizations.
New COBRA Benefits in 2009
Stimulus Package
[March 2009]
The
American Recovery and Reinvestment Act of 2009 calls
for changes to the health benefit provisions of the
Consolidated Omnibus Budget Reconciliation Act of
1985, commonly referred to as COBRA. The new law
affects former employees and their families,
employers and others involved in providing COBRA
coverage. Under the new law, eligible former
employees enrolled in their employer’s health plan
at the time they lost their jobs, are required to
pay only 35 percent of the cost of COBRA coverage.
Employers must treat the 35 percent payment by
eligible former employees as full payment, but
employers are entitled to a credit for the other 65
percent of the COBRA cost on their payroll tax
return.
Combating Fraud – Whistleblower
Hotlines
[February 2009]
This article provides
information on whistleblower hotlines and how they can
be designed as effective fraud detection and prevention
tools.
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