Monday, September 30, 2013

One-time car tax in Georgia

If you plan to purchase a new or used vehicle in the State of Georgia this year, here’s something to consider.   In March, Georgia House Bill 266 changed the annual ‘birthday tax’ to a new type of car tax.   State residents will now pay a one-time 6.5% title ad valorem tax (TAVT) instead of the annual tax when they register a car.  This one-time tax is based on the fair market value of the vehicle.

According to the Georgia Department of Revenue, dealerships must compare the value listed in the Georgia Motor Vehicle Assessment Manual for Title Ad Valorem Tax with the retail selling price less trade-ins and rebates. The greater value is deemed the fair market value and is the taxable amount.  Even though you may get a great price from a dealer, it’s still the fair market value that determines the tax you’ll pay to the state of Georgia.

When you finance your vehicle purchase from a dealer, the tax can be included in the financed amount much like sales tax was.  However, the TAVT also applies to the sale of used cars.   For example, if you buy a car from a friend, the one-time fee will be charged at the county tag office.  The title to the car won’t be transferred unless the fee is paid.  Keep in mind that the fee is not based on the sales price of the car; it’s based on the fair market value, which is found in the 2013 assessment manual. To determine the fair market value of a vehicle, click on this link:  TAVT Assessment Manual

Also, if you purchased and titled a vehicle between January 2012 and March 2013, you may be eligible to opt-in to the TAVT. To determine whether you can opt-in, click on this link: TAVT Calculator.  You may have also received a letter from the Georgia Department of Revenue informing you that your vehicle is eligible to opt-in to the TAVT.
Eric Tydings

Monday, September 23, 2013

Net investment income tax

Have you heard about the new 3.8% surtax on unearned income effective for the 2013 tax year? This is a funding provision of the Affordable Health Care Act (also known as “Obamacare”) passed in 2010. Basically, this tax may apply to individuals with adjusted gross income over $200,000 ($250,000 for a joint return or $125,000 for married filing separate). Specifically, the tax equals 3.8% of the lesser of:
  1. Net investment income. This includes interest, dividends, royalties, rents, gross income from a trade or business involving passive activities, and net gain from disposition of property (other than property held in a trade or business) reduced by deductions properly allocable to such income.
  2. The excess of Adjusted Gross Income over $200,000 ($250,000 for a joint return or $125,000 for married filing separate).

This new tax, along with increased 2013 income tax rates from last year-end’s fiscal cliff compromise legislation, will cause many taxpayers to have much larger federal income tax for 2013 than for 2012. If you did not take this into account in adjusting your wage withholding or estimated tax payments for 2013, you may have a very unpleasant surprise in the form of a large tax balance due come April 15, 2014. There is still time to lessen the blow by adjusting wage withholding for the remainder of the year or making or increasing the remaining tax estimates payment (4th quarter 2013, due by Jan. 15, 2014).

Please contact us if you need some additional info on this new tax or other year-end tax planning advice. 

Jim Story
Manager - Tax Department

Monday, September 16, 2013

Action required for ALL EMPLOYERS by October 1, 2013

Under the Affordable Healthcare Act, ALL employers who are subject to the Fair Labor Standards Act must send an Exchange Notice to ALL employees on or before October 1, 2013 informing them of their options under the new Health Insurance Marketplaces (Exchanges) that will open January 1, 2014.

The Notice requirement applies to employers of all sizes  whether or not they offer health coverage.  Employers must send the Notice to all full-time and part-time employees  whether or not they are benefit-eligible.  The Notice must be provided automatically and free of charge.  It can be provided by first-class mail or it may be provided electronically, if the requirements of the Department of Labor’s electronic disclosure safe harbor are met (these are at 29 CFR 2520.104b-1(c)).  It can probably also be hand-delivered.  The guidance does not prohibit or otherwise address hand-delivery, so you will probably want to get each employee to sign or initial that they received the Notice if you do hand-deliver it.

The GOOD NEWS is that the Department of Labor issued Model Notices (called the Notice of Coverage Options). There is a Model Notice for employers who DO offer a health plan to some or all employees (here's the link), and a separate Model Notice for employers who DO NOT offer a health plan to ANY employees (here's the link).

For employees who are hired after October 1, 2013, employers must provide the Exchange Notice at time of hire.  For 2014, an employer will be deemed to be in compliance if the Notice is provided within 14 days of an employee’s start date.  Also, the Notice requirement at this time is a one-time Notice requirement; not an annual Notice requirement. 

Currently, there is no penalty for noncompliance assessed by the Department of Labor, however the Affordable Healthcare Act has a $100 per day penalty.  If an employer is acting “in good faith” trying to comply with the law they may not be fined.  There is still much confusion about the penalty.  We are hoping it will be waived.

For additional information see Technical Release No 2013-02.

Kristine P. Braxton, CPA
Partner - Tax Department

Tuesday, September 10, 2013

Windows screen capture basics

There are several really easy ways to capture a picture of what is shown on your computer screen.  I’ll describe two of them here and another in a future post.  These features are very handy for preparing documentation, for passing along an error message to tech support, or any other time you need to “grab” a picture of what’s on your screen.

If you want to capture an image of what is shown on your monitor (or what is shown on ALL your monitors, if you have more than one) and then use it in Word, in an E-mail, or in any program that can manipulate a picture, just press the Print Screen key on your keyboard (sometimes abbreviated PrtScn).  You won’t see anything happen – there’s no flash or beep.  Windows captures your screen’s contents and holds on to the image in the “clipboard” – the invisible place in Windows where things are copied to and pasted from.  You can then go to almost any program and use the Paste function.  The entire image of your screen(s) will be inserted into that program.  It’s really that easy… but there’s a drawback when using Print Screen with multiple monitors:

When you use Print Screen with a multiple monitor system and then paste the image into Word (for example), the resulting picture is very wide and is automatically adjusted in order to fit in your Document.  The result is that it is difficult to make out details of the picture.  Enter the Alt-Print Screen shortcut:

Just hold down the Alt key while pressing and releasing the Print Screen key and Windows will capture only the active window and place that image onto the clipboard.  Everything else is the same (the Paste step, how and where you can use the captured image).  I use Alt-Print Screen a lot more often than I use Print Screen because the image is a more manageable size.

FYI – Either of these methods allow you to create what IT folks commonly call a “screen shot.”

Craig Rhinehart
Director of Information Technology