Many may have heard about the new tangible property regulations that have gone into effect this year and the frustration that many business owners and CPAs have had regarding the additional work required to comply with these rules. Lohman Company has been working tirelessly to bring these frustrations to the attention of legislators and demand that something be done to decrease the burden put on taxpayers and businesses.
Much of the frustration stems from the requirement that business owners as well as rental property owners not only have to apply the tangible property regulations to 2014 but must also apply them as if they were in existence in the previous years and make an adjustment currently. This means “looking back” in their records to determine whether prior year expenditures for tangible property, repairs, maintenance, materials and supplies were properly expensed or capitalized based on the new regulations. For some businesses this may require a review of records that go back more than 20 years!
These new regulations put an added burden on CPAs as well, requiring many more hours of work to complete all the necessary forms needed to just seek permission to comply with regulations. This then also puts an added monetary burden on taxpayers and businesses who must pay added fees to complete these forms.
Along with the AICPA, Lohman Company and many other CPAs have been writing to our legislators and senators to bring these issues to their attention. In addition, the AICPA has also proposed alternatives and suggestions for how to improve these regulations. Our professionals have also been impassioned to demand changes be made immediately in order to provide relief to our clients.
You can read the letters that have been sent to our state senators as well as the letter that has been sent by the AICPA to all legislators, HERE.
We will continue to bring you the most up-to-date information regarding these ever changing rules. We encourage you to also contact your representatives to let them know how these regulations may negatively affect you.