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About Sara Zaro
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Important Nevada Forms Changes
The Nevada Secretary of State has changed renewal forms as well as many other filing forms. Most of the new ones were revised in January, but only recently uploaded when they began implementing their new filing system.
We have been notified by the Secretary of State’s office that they are unable to provide us with pre-populated renewal forms (all previous filed information filled in).
At this time their new filing system is still not fully functional. However, Annual Lists may be filed online. As with many states, we believe the goal has been to have the majority of renewals, if not all, filed online.
As of today they are over a month behind on Annual List filings that were hand delivered. To view processing dates see link below.
https://www.nvsos.gov/sos/businesses/processing-dates
To file your Annual Lists online with the state go to the link below.
If you need assistance, please call us at (888) 274-1130.
Changes to Tax Code That Make LLCs and S Corps More Attractive
With the Tax Cuts and Jobs Act a new tax deduction for pass-through business income was created (LLC, S Corp, Partnership and Sole Proprietorship income). The deduction allows for a 20% deduction of qualified business income. There are a few limitations, but in general this means that 20% of business net income can be a deduction on the owner’s personal tax return. *
Before the Tax Cut and Jobs Act a C Corporation had a range of tax rates between 15% and 35%. After the Tax Cuts and Jobs Act the corporate rate is now a flat 21%. For most large corporations this is a win with a lower tax bracket, but if you were operating as a C Corporation with net profits less than $50,000 this is an increase of 6%.
For this reason we are seeing:
- An increase in the formation of LLCs (Liability protection; lower state fees overall; less paperwork)
- An increase in new Corporations electing S Corp status
- Existing Corporations making elections from C Corp to S Corp status with the IRS
Sole Proprietorships are not recommended in an asset protection strategy. With a Sole Proprietorship there is no protection for personal or business assets. A Sole Proprietorship has no Charging Order protection or “corporate veil protection”.
Nevada currently is the only state that has a Charging Order provision for closely held corporations.
* PLEASE NOTE: There are a few limitations to the Qualified Business Income deduction such as W-2 wage limitation; Service business limitation and higher income level limitation. Please seek advice from YOUR tax professional for your specific situation/goals.
Some information contributed by Elite Bookkeeping & Tax Services.
Changes to Filing Requirements for Nevada Commerce Tax
Per notification from the Nevada Department of Taxation:
The filing requirement for the Nevada Commerce Tax has been changed. If the Nevada gross revenue of your business from July 1, 2018 through June 30, 2019 was $4,000,000 (FOUR MILLION) or less, your business is no longer required to file a Commerce Tax return and your Commerce Tax Account will be automatically closed.
If the Nevada gross revenue for your business form July 1, 2019 through June 30, 2019 was over $4,000,000, your business is still required to file a Commerce Tax return on or before August 14, 2019.
In the event that your Nevada gross revenue exceeds the $4,000,000 threshold in a future year, it is your responsibility to file a return for the year. Failure to do so may result in the assessment of penalty and interest.
If you have already filed the return, please disregard the informational message.
For more information about Commerce Tax, including the filing requirements, please visit the State of Nevada Department of Taxation’s website: https://tax.nv.gov/WelcometoCOM/
A Summary of Important Tax Developments
Contributed by Elite Bookkeeping and Tax Services
The following is a summary of important tax developments that occurred in October, November and December of 2018 that may affect you, your family your investments, and your livelihood. Please call your tax adviser form more information about any of these developments and what steps you should implement to take advantage of favorable developments and to minimize the impact of those that are unfavorable.