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TEXAS SALES TAX EXEMPTION FOR LABOR TO REPAIR STORM DAMAGE

Posted by Admin Posted on Sept 20 2017

Texas Sales Tax Exemption for Labor to Repair Storm Damage

EEPB would like to remind our Clients who may have experienced Harvey related storm damage that there is an exemption from Texas sales tax on labor to repair damage to tangible personal property and commercial real property that was damaged as a result of Harvey. There is no exemption for Texas sales tax on the purchase of tangible personal property such as equipment or construction materials used to repair or reconstruct the
damaged property. However, if the equipment or construction materials qualify for some other Texas sales tax exemption such as the manufacturing exemption, these exemptions can still be used.


In order to claim the exemption from Texas sales tax on labor charges for storm damage repairs, the Texas Comptroller’s Office has established certain requirements which must be met. The exemption requirements are as follows:

  • The tangible personal property or the commercial real property being repaired must have been located in the area that was declared a disaster area by either the Governor of Texas or the President of the United States; and,
  • The amount of the labor charge must be separately stated from any charges for tangible personal property on the invoice, contract, or similar documents provided by the service provider.

 

The owner of the damaged tangible personal property or commercial real property must provide the service provider with a signed exemption certificate in order to claim the exemption on the service charges. Any contracts or invoices which contain a lump sum charge to include all materials and labor will not qualify for the exemption.

Should you have any questions regarding the Texas sales tax exemption for labor charges to repair storm damages, please call Carl Kluge at 713-622-0016, ext. 7742, or contact him by e-mail at carl.kluge@eepb.com.

2016 IRA CONTRIBUTIONS — IT'S NOT TOO LATE!

Posted by Admin Posted on Mar 22 2017

There’s still time to make 2016 IRA contributions: The deadline is April 18. If the contribution is deductible, it will lower your 2016 tax bill. But even if it isn’t, a 2016 contribution is likely a good idea. Your money can grow tax-deferred (tax-free in Roth accounts). But annual contributions are limited by law, and any unused limit can’t be carried forward; once the deadline has passed, the savings opportunity is lost forever. The 2016 limit is $5,500 (plus $1,000 for those age 50 or older on Dec. 31, 2016). Want to learn more? Contact us. 

HELP PREVENT TAX IDENTITY THEFT BY FILING EARLY

Posted by Admin Posted on Jan 13 2017

If you’re like many Americans, you might not start thinking about filing your tax return until close to this year’s April 18 deadline. You might even want to file for an extension so you don’t have to send your return to the IRS until October 16. 

But there’s another date you should keep in mind: January 23. That’s the date the IRS will begin accepting 2016 returns, and filing as close to that date as possible could protect you from tax identity theft. 

Why early filing helps

In an increasingly common scam, thieves use victims’ personal information to file fraudulent tax returns electronically and claim bogus refunds. This is usually done early in the tax filing season. When the real taxpayers file, they’re notified that they’re attempting to file duplicate returns. 

A victim typically discovers the fraud after he or she files a tax return and is informed by the IRS that the return has been rejected because one with the same Social Security number has already been filed for the same tax year. The IRS then must determine who the legitimate taxpayer is.

Tax identity theft can cause major headaches to straighten out and significantly delay legitimate refunds. But if you file first, it will be the tax return filed by a potential thief that will be rejected — not yours.

Another important date

Of course, in order to file your tax return, you’ll need to have your W-2s and 1099s. So another key date to be aware of is January 31 — the deadline for employers to issue 2016 W-2s to employees and, generally, for businesses to issue 1099s to recipients of any 2016 interest, dividend or reportable miscellaneous income payments. 

Delays for some refunds

The IRS reminded taxpayers claiming the earned income tax credit or the additional child tax credit to expect a longer wait for their refunds. A law passed in 2015 requires the IRS to hold refunds on tax returns claiming these credits until at least February 15.

An additional benefit

Let us know if you have questions about tax identity theft or would like help filing your 2016 return early. If you’ll be getting a refund, an added bonus of filing early is that you’ll be able to enjoy your refund sooner.

© 2017

A BRIEF OVERVIEW OF THE PRESIDENT-ELECT'STAX PLAN FOR INDIVIDUALS

Posted by Admin Posted on Jan 12 2017

Now that Donald Trump has been elected President of the United States and Republicans have retained control of both chambers of Congress, an overhaul of the U.S. tax code next year is likely. President-elect Trump’s tax reform plan, released earlier this year, includes the following changes that would affect individuals:
 

• Reducing the number of income tax brackets from seven to three, with rates on ordinary income of 12%, 25% and 33% (reducing rates for many taxpayers but resulting in a tax hike for certain single filers),
• Aligning the 0%, 15% and 20% long-term capital gains and qualified dividends rates with the new brackets,
• Eliminating the head of household filing status (which could cause rates to go up for some of these filers, who would have to file as singles),
• Abolishing the net investment income tax,
• Eliminating the personal exemption (but expanding child-related breaks),
• More than doubling the standard deduction, to $15,000 for singles and $30,000 for married couples filing jointly,
• Capping itemized deductions at $100,000 for single filers and $200,000 for joint filers,
• Abolishing the alternative minimum tax, and
• Abolishing the federal gift and estate tax, but disallowing the step-up in basis for estates worth more than $10 million.
 
The House Republicans’ plan is somewhat different. And because Republicans didn’t reach the 60 Senate members necessary to become filibuster-proof, they may need to compromise on some issues in order to get their legislation through the Senate. The bottom line is that exactly which proposals will make it into legislation and signed into law is uncertain, but major changes are just about a sure thing.

If it looks like you could be eligible for lower income tax rates next year, it may make sense to accelerate deductible expenses into 2016 (when they may be more valuable) and defer income to 2017 (when it might be subject to a lower tax rate). But if it looks like your rates could be higher next year, the opposite approach may be beneficial.

In either situation, there is some risk to these strategies, given the uncertainty as to exactly what tax law changes will be enacted. We can help you create the best year-end tax strategy based on how potential changes may affect your specific situation.

© 2016