Cherry Bekaert: The Tax Beat Cherry Bekaert

When expanding operations into the U.S. market, business owners must learn about the federal, state and local tax systems they will encounter. Sales tax in the U.S. is quite different from a value-added tax (VAT) or a goods and services tax (GST) assessed by many other countries. Companies selling goods and some services must comply with a sales tax system that can vary across thousands of taxing jurisdictions. The U.S. federal tax system can also be challenging for companies new to this country.  Companies and their tax advisors are currently busy working towards the March and April deadlines for filing tax returns, applications for additional extensions of time to file returns, and reporting income tax withholding.
Brooks Nelson, Partner and Strategic Tax Leader, and Sarah McGregor, Tax Director, talk with Lauren Stinson, Sales and Use Tax Leader, and Brian Dill, International Tax Leader, about the tax reporting complexities that international companies encounter when carrying on business in the U.S.

Listen to learn more about: 
03:54 – GST tax vs. U.S. sales tax05:24 – Compliance differences06:43 – Nexus 12:02 – Preparing for March 15 deadline14:54 – Important foreign subsidiary owner discussions17:14 – Outsource solutions 
 Related Guidance
Article: Tax Insights for Indian Companies in the U.S. MarketArticle: Beneficial Owner Information Reporting Final Rule for FinCEN Entity IdentifiersArticle: ASU 2023-09: FASB’s New Income Tax Disclosures for Private EntitiesArticle: ASU 2023-09: New FASB Rule Enhances Income Tax Disclosures for Public CompaniesPodcast: Accounting Standards Update 2023-09: New Income Tax Disclosure Rules

On December 14, 2023, the Financial Accounting Standards Board (FASB) expanded income tax disclosure requirements for public and private companies. The expanded disclosure requirements are detailed in Accounting Standards Update No. 2023-09 (ASU 2023-09) and increase transparency of a filer’s global taxes. This will require filers to provide more details and be more descriptive in their financial statement income tax disclosures, which should enable business leaders and investors to make more informed investment decisions.
Brooks Nelson, Partner and Strategic Tax Leader, and Sarah McGregor, Tax Director, talk with William Billips, Partner and Tax Provisions Leader, and Brian Dill, Partner and International Tax Leader, about ASU 2023-09 and how the new regulations will significantly impact multinational companies, particularly public and private entities. 

Listen to learn more about: 
03:49 – Background on ASU 2023-09  05:19 – Common requirements 07:47 – Rate reconciliation overview 09:48 – New challenges with tax disclosures in foreign jurisdictions13:14 – Steps to prepare for tax reporting next year16:38 – Affiliates in foreign jurisdictions Related Guidance
ASU 2023-09: New FASB Rule Enhances Income Tax Disclosures for Public CompaniesASU 2023-09: FASB’s New Income Tax Disclosures for Private Entities 

The Internal Revenue Service (IRS) has taken several steps to tackle the millions of invalid Employee Retention Credit (ERC) claims. First, they temporarily halted all ERC claims until the beginning of 2024. Two new programs were introduced by the IRS to aid employers who may have filed ERC claims they didn’t qualify for without realizing it.

The IRS announced the Voluntary Disclosure Program (VDP) on December 21, 2023, to aid employers who filed invalid ERC claims. The IRS created the VDP to allow taxpayers to report any potentially incorrect ERC claims by paying back 80% of the tax credit received by the company. Only available until March 22, 2024, employers should look into the VDP and determine if they should file for it.

Brooks Nelson, Partner and Strategic Tax Leader, and Sarah McGregor, Tax Director, talk with Martin Karamon, Tax Credits and Incentives Advisory Practice Leader, about the recent guidance released by the IRS regarding the VDP and recommendations for employers as the deadline is quickly approaching to file ERC claims. 
Listen to learn more about: 
04:16 – Background on the ERC  06:42 – Overview of new IRS programs for invalid claims11:57 – What to consider before participating in IRS programs 13:29 – Other options available for ERC concerns18:19 – Recommendations for employers considering filing ERC claims before the deadlineRelated Guidance
Understanding IRS’ Voluntary Disclosures Program for Employee Retention Credit (ERC) ClaimsNew IRS Employee Retention Credit (ERC) Claim Withdrawal ProcessDecember ERC Updates: Mastering Preparations for ERC 2024IRS Temporarily Suspends ERC Claims: What You Need to KnowIRS Update on ERC Eligibility: 5 Scenarios That Do Not Qualify as Supply Chain Disruptions

The New Markets Tax Credit (NMTC) program has been issuing tax credits for more than two decades as a driving force for investors to aid low-income communities across the United States. In September 2023, Cherry Bekaert’s The Innovate Fund, a Community Development Entity (CDE), received a $50 million allocation in NMTC. With this money, The Innovate Fund will continue to support and enhance community development projects in North Carolina, South Carolina, Tennessee and Georgia low-income communities.

Brooks Nelson, Partner and Strategic Tax Leader, and Sarah McGregor, Tax Director, talk with Laurel Tinsley, Managing Director of Cherry Bekaert’s Strategic Financing Services group, about the obstacles and opportunities for those applying to the NMTC program and how The Innovate Fund is a key source of financing for lenders when taking on a community development project. 

Listen to learn more about: 
02:54 – Background on NMTC, CDE and CDFIs09:00 – What it means to be awarded NMTC allocations15:02 – Recent learnings from NMTC awards  17:46 – Navigating NMTC allocation complexities 22:46 – Key focus that would help people win future NMTC allowances 
Related Guidance
New Markets Tax Credit Case Study for 4Roots Farm CampusNew Markets Tax Credit Case Study for Welcome HouseNew Markets Tax Credit Case Study for Williams Adult Day Center

The Tax Cuts and Jobs Act (TCJA) was enacted in 2017, and part of this bill amended the lifetime exclusion amount for estate and gift tax planning. Over the last 6 years, the lifetime exclusion has ballooned from $10 million to over $13 million in 2024. Together, a married couple could leave $26 million of asset value to their family or other beneficiaries, free of federal estate tax. However, at the end of 2025, this increased lifetime exclusion will sunset and revert to a lower amount. What can taxpayers do now to enhance their estate planning, and how do recent Tax Court cases impact estate planning?

Brooks Nelson, Partner and Strategic Tax Leader, and Sarah McGregor, Tax Director, talk with Mike Kirkman, Partner and Estate, Trust, and Gift Tax Leader, and Katie Sims, Estate, Trust, and Gift Tax Manager, about the importance of taking time to engage in estate and trust tax planning for small and large estates. 

Listen to learn more about: 
04:04 – Annual gifts and estate exclusions from 2023 and 2024 04:52 – Importance of addressing estate planning06:55 – Schlapfer case, Tax Court Memo 2023-65  09:14 – Cecil case, Tax Court Memo 2023-2412:30 – Planning taxpayers should engage with trusts15:33 – Spousal Lifetime Access Trust (SLAT) overview18:33 – Estate of Hoensheid Tax Court Memo 202321:00 – Advice for smaller estates
Related Guidance
Federal Estate and Gift Tax Exemption Will Sunset After 2025: How to Prepare Now2023 Year-End Tax Planning Checklist for Individuals

The Inflation Reduction Act of 2022 (IRA) bolstered existing clean energy tax credits and incentives and added new ones. Looking forward to 2024, it is important to stay up to date with the qualifications for these various tax credits and incentives and the growing marketplace for transferring credits between buyers and sellers. The Internal Revenue Service (IRS) regularly releases notices and proposed regulations to provide guidance to help taxpayers benefit from these clean energy credits. Cherry Bekaert’s Energy Credits and Incentives team stays on top of these important alerts to ensure our clients are best positioned to take advantage of IRA provisions.

Brooks Nelson, Partner and Strategic Tax Leader, and Sarah McGregor, Tax Director, talk with Tim Doran, Director, and David Mohimani, Manager, from our Energy Tax Credits and Incentives team, about how companies can take advantage of these tax credits and incentives. They also discuss recent IRS guidance on how taxpayers can monetize these credits by transferring them to potential buyers.

Listen to learn more about: 
04:03 – IRA overview of investment and production credits06:43 – Section 179D, Section 45L, improvements under IRA09:03 – IRS notices and proposed regulations to maximize credits 16:02 – Examples of other credit boosters based on project materials or location 18:54 – IRA monetization provisionsRelated Guidance
Article: Take Advantage of New Section 45L Tax Credit Opportunities Under IRAPodcast: IRA Domestic Content Bonus Credit: How To Maximize Your Energy Tax CreditsWebinar: Maximize Tax Savings Through Cost Segregation, Section 179D, and Section 45L Approach and Client Success StoriesPodcast: Energy Savings Revolution – Section 179D for Commercial BuildingsArticle: Capitalizing on Elective Pay and Transferability of Tax Credits Under the Inflation Reduction ActBrochure: A Comprehensive Overview of Energy Tax Credits Under the Inflation Reduction Act of 2022