November 7, 2011 by Robert Rhodes.

A friend and business associate, Jason Gay, came up with a Federal income tax item that everyone in the investing community needs to know.  I will give you all an excerpt from his e-mail here:

Something important came up in my Federal Income Tax class.  Section 1202(a)(4) of the Internal Revenue Code excludes 100% of the capital gain realized from the sale of stock acquired before January 1, 2012 from gross income for non-corporate taxpayers (up to a $10,000,000 gain under 1202(b)(1)(A), or 10 times the adjusted basis under section 1202(b)(1)(B) for a cash investor).

In other words, for sweat equity investors in a start up company, capital gains from the sale of stock issued between now and the rest of the year would be exempt from taxes for up to a $10,000,000 gain…

Of course I call on my other associates in the CPA community who came up with a blog link that really puts in perspective - here is the link. This friend, Steven Plumb at Clear Financials, had this to say:

The holding period is 5 years, so if you have something that qualifies for 5 years, it is helpful.  Must be a C corporation.  This credit has been on the books for a long time, but [Mr.] Obama reduced the tax rate from 14% to zero as a job creation incentive.  Unfortunately, a tax credit 5 years down the line doesn’t really provide much incentive to start a business today.

Bottom line, invest today as normal, but try to get the tax treatment if you can.

Posted in General | Print | No Comments »

June 29, 2010 by Robert Rhodes.

Robert C. Rhodes’s Contributor Profile - Associated Content

Read More

Posted in Public Markets | Print | No Comments »

November 3, 2009 by Robert Rhodes.

This came straight from Susan Combs, Texas Comptroller of Public Accounts - they are great about communicating with Texas corporations:

The new Online Franchise Tax Calculator (PDF, 263KB) is now available on Window on State Government.  This tool allows you to estimate your potential franchise tax liability for report years 2008, 2009 and 2010.  Your actual tax liability may differ from the estimate because of special provisions in the legislation.

You may also wish to visit our Franchise Tax Web page for answers to your other franchise tax reporting questions.

Posted in General | Print | No Comments »

October 6, 2009 by Robert Rhodes.

On October 2, 2009, the Securities and Exchange Commission (“SEC”) issued a press release giving nonaccelerated filers (those public companies with a public float, as measured at the end of their second fiscal quarter, of less than $75 million) additional time to comply with the requirements of  Section 404(b) of the Sarbanes-Oxley Act.  Section 404(b) will now apply to the annual reports of nonaccelerated filers for fiscal years ending on or after June 15, 2010.  As a refresher, Section 404(b) established the requirement for a company’s audit firm to issue an audit opinion on the effectiveness of a company’s internal control over financial reporting (“SOX Opinion”).  The requirement for a separate SOX Opinion was in addition to management’s report on internal control over financial reporting (“Management’s Report”). 

  Read the rest of this entry »