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Not Another ChatGPT Article…
Yes, another ChatGPT article. Or GenAI, really. Okay, I saw you roll your eyes. Well, not "saw" per se, but I felt it allllll the way from over here. But honestly, this is for your benefit, not mine! I've already figured out a ton of ways to use it to make my life easier. Yes, that's right, it's made my LIFE easier, not just work. I'm happy to share a little bit about it if you're interested. Also, before you say (again), "ChatGPT can't do tax returns or tax research. It's a useless piece of technology," - I get it! So much of what we focus on in our practice is the actual work parts. But we are far more than just tax compliance. Or at least we want to be. Okay, think about it this way - why did you become a tax practitioner? Was it because you wanted to help people? Or was it because you thought, "Oh boy, I sure love to just crank out tax returns for 80 hours a week, three months a year!" I'm guessing it was the former! And I don't know about YOUR tax practice, but mine has gotten far more complicated in the last... 20 years? Let's think about all of the changes that have happened in just the last five years? (Okay, yes, that's cheating, but I'm going to do it anyway). We've had TCJA, SECURE, CARES, SECURE 2.0, and probably half a dozen more, in addition to new regulations, case law, IRS pronouncements, state tax law changes, etc. And that's JUST with the tax law. In your practice, consider all of the things that have changed and gotten more complicated. Hybrid and remote work, finding employees, ever-expanding technology stack, one of those fancy new espresso machines with too many buttons, going paperless but still having at least five clients that mail you their documents, trying to determine a niche to offset the additional complexity, figuring out how to market to that niche... And on and on and on. So, my question would be - why WOULDN'T you want to use tools like ChatGPT to offload some of the work? GenAI came along just in time to address a lot of these issues. And I get it, it's hard to see that the pot is boiling when you're the frog in the soup, but let me tell you - the pot is boiling. Let's get you out of there!
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Games Industry Lore 101: Basics Tax Practitioners Should Know
When building your book of business, especially small business clients that do the heavy lifting due to their recurring complex tax filings, you might ponder seeking out clients in the video games industry. Salivating at the prospect of capturing just a tiny sliver of that nearly half-trillion market valuation as your social media feeds flood with news and memes from a random indie game you’ve never heard of, you wonder how to attract and retain game developer clients. But there’s several things that tax practitioners should know about how the games industry works, and its innumerable oddities, before diving head-first into taking on game developers as business or individual clients. Ready to press play?
The NIL Tax Playbook
Regardless of where you stand on the issue, student athletes have been able to tap into a new revenue stream since July 1st, 2021. This is when the National Collegiate Athletic Association (NCAA) began to allow students to profit from their name, image, and likeness (NIL). Which leads to new tax implications for a group of taxpayers who may have never filed a tax return before. As this has unfolded, it reminded me of taxpayers who were on the forefront of making money online. It was something new, so not many taxpayers or even tax practitioners knew how to handle it. It was real money, but was it really a business? I’ve loved seeing it evolve. Now, right off the back of COVID-19, we have student athletes who are able to take advantage of their online presence and also make money. But the income people were making 20 years ago online is pennies compared to what some students can make through NIL deals. In 6 short years, students have gone from not being able to profit monetarily from their likeness while competing as a student to now potentially making millions.
D&A Planning After the One Big Beautiful Bill Act
After 2021, whether an expenditure was deducted currently or recovered through depreciation often affected timing, but it typically did not create a meaningful advantage from a Section 163(j) perspective. The restoration of depreciation, amortization, and depletion addbacks in the computation of adjusted taxable income (“ATI”) has changed that analysis and created a new opportunity for taxpayers with actual or anticipated interest limitation exposure. As a result, taxpayers should reconsider whether certain expenditures that historically may have been deducted immediately can instead be capitalized into depreciable or amortizable property in order to improve their Section 163(j) profile.
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