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Bears Business Brief: How tax law updates could impact your filing season

By: Kerri Tassin

Kerri Tassin
Kerri Tassin

In today’s column I will take a look at recent tax law provisions, some proposed and others enacted, during 2015. Some federal provisions will impact future filing seasons for certain taxpayers, while a Missouri tax provision benefited certain taxpayers during 2015. And one proposed federal bill may come to the rescue of business and individual taxpayers, hopefully in the near future. The following are some highlights of this year’s legislative activity.

On April 27, 2015, Missouri Governor Jay Nixon signed into law H.B. 384 which made a provision for amnesty from the assessment or payment of penalties, additions to tax and interest related to unpaid taxes. The amnesty provided for in Missouri revised statute 32.383, applied to individual income tax, corporate income tax, sales and use tax and corporate franchise tax among others. Only tax liabilities due on or before Dec. 31, 2014, qualified for the amnesty provisions. Taxpayers who took advantage of the amnesty paid amounts due by Nov. 30, 2015. These taxpayers must also continue to comply with state laws for the eight-year period following the amnesty agreement and will not be eligible for future amnesty agreements for the same type of tax.

In addition to the amnesty provisions, H.B. 384 included the creation of an independent Office of Taxpayer Advocate for the state of Missouri. Pursuant to Missouri revised statute 37.650, the Office of Missouri Taxpayer Advocate will have the ability to communicate with taxpayers regarding their tax issues and will also have the ability to communicate with the department of revenue regarding the tax issues. According to the statute, the governor will appointment an individual to the position, and this individual will report annually to the governor regarding the number of cases handled during the year and offer recommendations concerning Missouri tax law and procedure.

On July 31, 2015, President Obama signed H.R. 3236 into law. Part of the law affects the due dates for several tax returns filed for tax years beginning after Dec. 31. Under this new law, calendar year partnerships will have a March 15 filing deadline, which is one month earlier than the previous April 15 deadline. The filing deadline for calendar year S corporations will remain March 15. The goal of this provision was to provide partners with their forms K-1 prior to the individual filing deadline of April 15. The Act provides that calendar year C corporations will have a new filing deadline of April 15, one month later than the previous March 15 deadline. This act also extended several filing deadlines for taxpayers who requested an extension of time to file tax returns.

Several federal tax law provisions affecting both business and individual filers expired at the end of 2013, but were extended for one more year by the Tax Increase Prevention Act of 2014 in December 2014. Unfortunately the timing of the extenders’ legislation made it difficult for taxpayers to plan during 2014. At the time this article was written, legislators continued to work on a bill which would again extend these provisions. The future of mortgage debt relief, the tuition and fees deduction, the educator expense deduction, bonus depreciation, Sec. 179 expense limitation increases, the Work Opportunity Tax credit, and energy related provisions, just to name a few, still remain in limbo. We’ll keep our eyes on Capitol Hill to see what happens.

The material in this article is for informational purposes only and does not constitute written tax or legal advice. Please consult with your own tax adviser regarding your personal tax situation.

This article appears in the October 2nd edition of the Springfield News-Leader and can be accessed online here.

Assistant Professor Kerri L. Tassin, CPA, JD teaches tax accounting classes in the School of Accountancy at Missouri State University. She also serves as director of the MSU Public Service Tax Clinics.

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Bears Business Brief – Where are your financial strengths and weaknesses?

By: James Philpot 

James Philpot photo
James Philpot

How well off are you? Where are your financial strengths and weaknesses? In recent columns, my colleague Rayanna Anderson discussed using financial statements in managing a business. You can similarly approach your personal finances and goals, and in this column I will begin a series on personal financial statements by discussing the balance sheet.

A well-constructed personal balance sheet can provide insight for financial questions regarding debt management, investing, risk management and estate planning. Just like a business’s balance sheet, your balance sheet shows the values of your assets and your liabilities (debts) at one point in time. However, a personal balance sheet actually reflects better accounting than a business balance sheet because personal assets are valued at market value, whereas business assets use historical cost.

To compile your balance sheet, you will need account (bank, brokerage, insurance, retirement, etc.) statements, real property (including personal and business assets) values and the outstanding balances of your debts.

The assets section of a personal balance sheet has three categories. Cash assets are very liquid and safe, easy to value and easy to spend. These include cash, bank accounts and short-term money market securities. Financial planners often view cash assets as a source of emergency funds. Investment assets are long-term assets held for gain and are more risky and less liquid than cash assets. Stocks, bonds, retirement accounts, cash value life insurance, mutual funds, rental property and closely held business interests are common investment assets. Sometimes, as in the case of rental property of business interests, investment assets may require sophisticated valuation, but your best estimate will work for a start. Personal use assets are tangible assets — personal residence(s), vehicles, jewelry, collections, etc. — that while valuable, are not usually considered as investments. Like some investment assets, personal use assets may require effort to value. Sometimes Web-based marketplaces like kbb.com (cars), eBay or Craigslist (personal property), or a local real estate broker’s listing site can provide comparison values for personal use assets.

To construct the assets section of your balance sheet, organize your assets by category and list the asset and its balance or estimated value. For planning purposes, it can be very helpful also to note the ownership (husband, wife or joint) of the individual assets/accounts and whether an asset or account has a named beneficiary or pay/transfer on death recipient, as it will affect the transfer of assets outside of probate. Summing the value of each asset item gives us total assets — the value of what you own.

The liabilities section includes the balances owed on all of your outstanding debts. Each item’s value on the balance sheet is typically the principal balance remaining. The liabilities section has two categories. Current liabilities are balances due within one year and include credit cards, apartment lease obligations and other short-term borrowing. Long-term debts are due in more than one year and include home and car loans, student loans, etc.

Your personal net worth is the value of your total assets less your total liabilities. Financial planners use net worth as a starting point for assessing individual or family financial well-being. In future Bears Business Briefs columns, I will discuss other financial statements and their use in analyzing your financial position.

This articles appeared in the September 26 edition of the Springfield News-Leader and can be accessed online here.

James Philpot is a certified financial planner and is associate professor of finance at Missouri State University.


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Entrepreneurship Student Places in Photography Competition

Rebecca Stevick, a junior Entrepreneurship major, was selected as a finalist in The 35th Annual Spring Photography Contest, co-sponsored by Photographer’s FORUM magazine and Sigma. Stevick was selected from more than 10,000 entries from 69 countries. As a result her work will be published in the book “Best of Photography 2015.”Winning Photo

The winning photograph was taken in July 2014 while Stevick was participating in a Missouri State short-term study abroad tip to India with Dr. Saibal Mitra. Taken at the Jama Masjid Mosque in Old Delhi, India, her photo depicts moments following the traditional evening prayer. Upon graduation, Stevick plans to use her Entrepreneurship degree and love of photography to open a gallery or studio.

Her winning photo and more can be seen online at http://pfmagazine.com. To see more of Stevick’s work you can view her website at www.beccastevickphotography.com.

Rebecca and local child
Rebecca Stevick in Old Delhi, India
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Bears Business Brief-What does Supreme Court decision mean for businesses and consumers?

By Richard Ollis

headshot Richard Ollis
Richard Ollis

Health insurance and health care as we know are both changing. A June Supreme Court decision regarding the Affordable Care Act and subsidies for health insurance, along with the 2012 decision regarding constitutionality, basically ensures that the ACA will survive in some form.

Anthem health insurance company has announced that it intends to buy rival Cigna. This news came just weeks after Aetna and Humana announced their potential merger. If approved, these mergers will create three big companies that will dominate the U.S. market, with United Health Group being the third.

What does all this mean for businesses and consumers as we deal with this massive shift?

1. There will be fewer options for insurance. Both businesses and consumers will see their choices dwindle. Three large companies will dominate the market place (Anthem, Aetna and UHC). A recent Wall Street Journal article found that after the mergers, a number of U.S. counties of Medicare Advantage customers will only have one option for insurance. The mergers will also remove competitors from ACA exchanges.

2. Plan quality and customer service could deteriorate. Many plans are already limiting their network of doctors and providers to reduce costs. Telemedicine, online appointments and 1-800 lines are replacing the traditional doctor/patient relationship. Sarah O’Leary, founder of Exhale Healthcare Advocates, says, “when consumers have less choice and the insurers realize it, cost of coverage, plan quality and customer service may be affected.”

3. Out-of-pocket payments could increase. Many plans are already changing plan designs into a more consumer-driven model. Doctor co-pays, deductibles, urgent care deductibles and emergency room deductibles are rising to both contain cost and make plans more “consumer driven.” ACA compliant plans typically offer higher deductibles and co-pays.

4. We will see unique health insurance options and boutique healthcare offerings. Businesses are already considering plans that are self-funded, partially self-funded or are banding together in associations or captive arrangements. These types of plans avoid some of the fees and provisions of the ACA. Direct primary care, where patients either access care at work or pay a membership fee to have access to a doctor, lab and some prescriptions, is becoming more popular. The marketplace will always react to a changing landscape.

5. Regulations are becoming complicated and burdensome. Pay-or-play, exemptions, calculating part-time employees and the individual mandate are just a few. The timeline for implementation of the ACA also continues to change. Becoming educated on all the mine fields is virtually a full-time job.

As this world of health insurance and health care evolves, one thing remains constant – the real objective is improved health. Wellness programs are evolving to include programming for stress, sleep, finances and life balance. The Wellness Council of America is changing its focus to include much more of a holistic approach to the health and well-being of America’s workforce.

The marketplace is beginning to offer more natural and homeopathic forms of healthcare, many not standardly covered by insurance. Massage, yoga, acupuncture and supplements are just a few examples.

Given the complexity of regulations, the changing marketplace and the new offerings available, it’s important to become educated and engage an expert for advice. With change comes opportunity, but only for those who understand the evolving landscape.


This article appeared in the September 20 edition of the Springfield News-Leader and can be accessed online here.

Richard Ollis is CEO of Ollis/Akers/Arney, a regional insurance and business advisory firm. He is a current member of the Missouri State University College of Business Executive Advisory Council.  He also serves on the board of the Wellness Council of America.

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