While death and taxes are a certainty for most of us, if you're a tech company in Silicon Valley, taxes may be optional (yeah, we're looking at you Apple). We're going to assume that your company is much more ethical, and actually pays taxes in the U.S. for purposes of this discussion. Which leads us to the inevitable ... are you ready to advise your company on tax issues?
Audit and tax advisory firm KPMG has put together a list highlighting business tax issues for 2014, and while everything on the list was important, we've selected some of our favorites to tell you about.
1. Get Your Head In the Cloud
As cloud computing is on the rise, KPMG suggests that tax executives get involved at the early stages of discussion related to how "the cloud" will play a role in the business -- in order to avoid "miss[ing] incentives and planning opportunities."
2. Sit at the Table
As Jeff LeSage, vice chair of tax services for KPMG correctly noted, "Almost every business decision has tax -- and potentially -- reputational implications." As GCs increasingly become a member of the team making strategic business decisions, it's imperative to keep tax considerations in mind every step of the way.
3. Review Tax Exempt Strategies
Just as individuals should make charitable contributions, so should corporations. Review your company's tax exempt strategies to make sure that the company's philanthropic goals align with its business objectives.
4. New Repair Regulations
In September 2013, the IRS issued new repair regulations related to fixed assets and tangible property. The regulations took effect January 1, 2014, so it may be in your company's best interest for you to brush up on these new regulations.
5. Profit Shifting and Tax Havens
The controversy surrounding Apple's (and many other companies') tax avoidance and use of international loop holes is bringing the wider issue to the forefront. Consumers and the government are taking note. If your company uses these types of loopholes, keep an eye on the legal landscape.
6. Keep an Eye on Reforms
In addition to profit shifting, GC must keep an eye on all tax reforms affecting business. With every decision essentially a tax decision, you can never be too current on tax law.
While the list of tax issues that you will want to be aware of is not finite, these six areas provide a good starting point as we head into the new tax year. Use this list to kick start the year because, the more you do up front, the less likelihood of running into trouble with the IRS.
What tax issues are on your horizon? Tweet us @FindLawLP.
- The 'Double Irish' Tax Loophole: Can Your Company Exploit it? (FindLaw's In House Blog)
- Former Ohio In House Counsel Gets Prison for Tax Fraud (FindLaw's In House Blog)
- Tips for 2014: New Year's Resolutions In-House Counsel Can Keep (FindLaw's In House Blog)
- FindLaw's Corporate Counsel Center (FindLaw)