Message from Joseph J. Perry
Welcome to our 2017 Marcum Year-End Tax Guide. As our Firm’s Tax & Business Services practice leader, I am proud to preside over the finest tax professionals in the industry. Our more than 500 tax associates, many with advanced degrees, guided our clients through myriad tax issues during this past year. We provided creative solutions and helped our clients through both personal and business challenges, while staying up-to-date on all federal and state tax developments, as well as potential changes in future rules and regulations.
Just as we are going to press, on November 2, the House published its Tax Cuts and Jobs Act, proposing significant changes in our income tax code affecting individuals and businesses in both favorable and unfavorable ways. Businesses will certainly pay less tax, as will their owners. Many individuals, certainly middle class and lower income earners, will pay less tax. Higher income earners who previously had taken advantage of significant itemized deductions will probably see increases in their tax liabilities under the proposal. The loss of significant deductions will most likely result in additional tax liabilities for many of our clients.
The House proposal is a radical departure, both in tax bracket structure for business entities and in eliminating deductions, while curtailing many of those still remaining for individual taxpayers. While we can hope for reasonable compromise, lobbyists on both sides will continue to have an outsized impact on any ultimate resolution.
While change is certainly coming, it is impossible to read the tea leaves and tell you for certain where we are heading. I do, however, believe tax rates for businesses will be reduced and important incentives adopted. While meaningful changes on the individual side have been proposed, they affect so many East and West Coast taxpayers that it remains unclear if the votes necessary to pass the legislation will be found. We will continue to keep you advised as we learn more through our regularly issued Tax Flashes.
In addition to federal developments, states are becoming more adept at seeking out additional revenue by subjecting non-resident taxpayers to their state income taxes. They are ferreting out noncompliance through sophisticated targeting. Our tax professionals continue to actively monitor these changes, to make sure our clients have the most up-to-date knowledge and can plan accordingly.
A recap of 2017 would not be complete without acknowledging that many of our fellow citizens, friends, and associates are still recovering from the numerous natural disasters that caused unfathomable hardship and destruction this year. Everyone here at Marcum sends our most positive hope and best wishes to those who have been impacted. Our offices have all raised funds for relief, and each of us remains ready to help our clients and friends in any way we can.
Help is on the way from our federal and state governments as well. Time-sensitive deadlines have been pushed back for federal filing and payments, with many states following suit. Legislation may well be forthcoming to ease charitable donation limitations, allow deductions for losses to be taken in 2016 instead of 2017, and ease or remove penalties for early pension distributions used for disaster-related charitable purposes Rely on us for updates about new developments.
Marcum remains dedicated to working with you to plan and execute strategies geared to accomplishing your objectives and ensuring your day-to-day compliance needs are met. We look forward to helping you and your family continue to build successful businesses and personal wealth. No matter the changes in tax law, we will be ready with answers and planning ideas.
Marcum places the highest value on your continuing trust and confidence in us. We wish you happiness, health and success in 2018 and beyond.
Please remember: just “Ask Marcum.”