File Name: business tax and financial environment file.zip
- Chap 2 - The Business, Tax, And Financial Environments
- State Tax Exposure for Financial Institutions: What You Need to Know
- Corporate income tax
- Designing Optimal Models of Financial Regulation in a Changing Financial Environment
Chapter 2 The Business, Tax, and Financial Environments After studying Chapter 2, you should be able to: Describe the four basic forms of business organization in the United States — and the advantages and disadvantages of each. Understand how to calculate a corporation's taxable income and how to determine the corporate tax rate - both average and marginal. Understand various methods of depreciation. Understand why acquiring assets through the use of debt financing offers a tax advantage over both common and preferred stock financing. Describe the purpose and make up of financial markets.
Chap 2 - The Business, Tax, And Financial Environments
Financial institutions generally have economic nexus with numerous states because they generate gross receipts typically interest from customers located throughout the country. As a result, financial institutions must be aware of tax developments in all states, since most are adopting economic presence nexus. Interestingly, most state tax reform has a general application to all corporate taxpayers. In addition, financial institutions generally need to account for the impact of state tax reform in their financial reporting and tax provisions when the reform is enacted into law, even if the effective date is prospective.
Specifically, this article will address how financial institutions may be impacted by: The U. Wayfair, the U. Supreme Court overturned the longstanding physical presence nexus requirement and upheld the application of economic presence. Therefore, the decision confirms what most state tax practitioners have long acknowledged with respect to income tax and gross receipts tax: States can generally enforce economic presence nexus provisions on taxpayers, including financial institutions.
Indeed, a number of state court decisions prior to Wayfair that sustained state economic presence nexus in the income tax context involved financial institutions. States that adhere to an economic presence nexus standard consider nexus to be triggered merely by making sales into the state or generating revenue from transactions occurring in the state. In , Hawaii, Massachusetts and Pennsylvania enacted bright-line economic presence nexus provisions.
Effective for tax years beginning on or after January 1, , Indiana enacted a broader economic presence nexus statute without any minimum sales threshold. It should be noted that these recent developments are not only in addition to pre-existing state case law sustaining economic presence nexus on out-of-state financial institutions, but also in addition to those states that have historically imposed economic presence nexus by statute on financial institutions Indiana, Minnesota, Tennessee and West Virginia.
Note, however, that financial institutions may share common-ownership and be engaged in unitary business with entities that New Jersey currently requires to file on a separate-entity basis: real estate investment trusts, regulated investment companies, and investment companies. New Jersey issued specific guidance to assist banking corporations that historically filed income tax returns on a calendar year privilege period pursuant to N.
Software licenses and remotely accessed information services are generally sourced to where the users of the license or information are located. Purchasers of such products should inform the vendors of where the users are located so that the appropriate sales tax could be charged or use tax self-assessed. Note, however, that taxpayers may need to self-assess and report use tax to other states where the vendor did not charge sales tax.
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State Tax Exposure for Financial Institutions: What You Need to Know
Corporate income tax
For more information, see Special Notice Vol. You may receive a phone call or letter from TRA about your existing debt or outstanding returns. TRA will be reconnecting with taxpayers to re-evaluate their current situation, discuss the possibility of a payment arrangement and the filing of outstanding returns. There will be no legal actions taken at this time. In order to reduce the necessity for taxpayers and tax preparers to meet in person, TRA will recognize electronic signatures.
Designing Optimal Models of Financial Regulation in a Changing Financial Environment
As well as highlighting how corporations and enterprises — national or multinational — can be effectively engaged in entrepreneurship and innovation as a means of fulfilling corporate social responsibility goals and objectives, this book aims to propose means whereby auditors and particularly, external auditors could more effectively fulfil corporate governance roles through implementation of local, regional, national and internationally recognized codes, regulations, and standards. As the tripartite arrangement between the Financial Services Authority, Bank of England and the Treasury has revealed, even well-designed regulatory structures are prone to flaws and shortcomings, where resources are inadequately allocated and where the necessary level of communication and coordination is lacking. The structure of financial regulation is hence not only crucial to the success of the attainment of regulatory objectives, but also the extent of involvement, coordination, and cooperation between involved supervisory authorities.
Financial markets comprise all institutions and procedures for bringing buyers and sellers of financial instruments together. In a broad context, the financial markets exist as a vast global network of individuals and financial institutions that may be lenders, borrowers or owners of public companies worldwide. Cabrera, Elenita, Financial Management vol. Large corporations raise funds in the corporate financial markets.
This single owner has unlimited liability for all debts of the firm. Summary for Sole Proprietorship Advantages Simplicity Low setup cost Quick setup Single tax filing.