AZ CPA September/October 2020

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AZ CPA September/October 2020

2020 Arizona Legislative and PAC Report Arizona’s Tax Reactions to COVID-19 Steps for Businesses to Survive Crisis The Arizona Society of Certified Public Accountants y


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*2018 AZDOR Report

AZ CPA The Arizona Society of Certified Public Accountants President & CEO Editor

Cindie Hubiak

Patricia (Gannon) Rife


Heidi Frei

Board of Directors Chair Chair-Elect

Ginny DeSanto Tom Duensing Secretary/Treasurer Rachael Bertrandt Directors Keith Cowan Kelly Damron Jessica Estrada Tabitha Fox David Gephart Ross Grainger Jessica Iennarella Andrea Levy Anthony Lorenzo James McGettigan Lauren Murro Gidget Schutte Immediate Past Chair Jared Van Arsdale AICPA Council Members Rob Dubberly

Greg Nelson Chapter Presidents Southern Chapter Clark Goding Northern Chapter James Shankland Southwest Chapter Helen Greenwell North-Central Chapter Gidget Schutte AZ CPA is published by the Arizona Society of Certified Public Accountants (ASCPA) to provide information, news and trends to the accounting profession. It is distributed six times a year as a regular service to ASCPA members. The ASCPA, its members, board of directors and administrative staff assume no responsibility for advertisements herein. The ASCPA and the above people also assume no liability for business decisions made by readers in reference to statements and/or claims in articles or advertisements within this publication. Opinions expressed by contributors are not necessarily those of the ASCPA.

Arizona Society of CPAs 4801 E. Washington St., Suite 180 Phoenix, AZ 85034-2040 Telephone (602) 252-4144 AZ Toll-Free (888) 237-0700



Volume 36 Number 6


September/October 2020



Contemplating a Job Change — Is the Grass Really Greener? A career change should be carefully and strategically planned. What should you consider when deciding if you are in the right place? by Samantha E. Mahlen, CPA, CFE

Arizona’s Tax Reactions to 11 COVID-19

by Pat Derdenger and Karen Lowell

Columns & Departments

Chair’s Message by Virginia E. DeSanto, CPA


Member News


ASCPA Board Highlights


ASCPA Preferred Providers


2020 Arizona Legislative Report To say it has been an unprecedented year would be putting it mildly, but the ASCPA continued to make a difference in supporting CPAs. by Ryan DeMenna


Classifieds 22 Quick Quiz

Find out what you need to know about how Arizona responded to the pandemic.



ASCPA PAC Report Thank you to the ASCPA members who contributed more than $59,800 last fiscal year to open doors, share ideas and make sure the CPA voice was heard.

19 4801 E. Washington St., Suite 180 Phoenix, Arizona 85034-2040

Steps for Your Clients and Business to Survive Crisis and Recover Address these steps to help improve

your chance of business survival. by John S. Stoner, CPA (in PA), CVA



ASCPA Chair’s Message

Return to the Office — Yes or No? Return to the office – yes or no? That is a big, big question that many companies are facing in some way. In moving to remote or work from home modalities, we have learned a lot, innovated a lot and changed a lot. In discussions that I’m involved in, the hardest part of the question is can we return to the office and still practice social distancing? Can we keep everybody safe and healthy?

Virginia E. DeSanto, CPA, CGMA Chair, Arizona Society of CPAs CFO & Treasurer, ASU Enterprise Partners

The general belief at my company is that we are just as efficient working from home in most cases, but the face-toface social connectedness is disintegrating.

Many companies are considering whether or not it’s even necessary to return to the office. If we’ve successfully moved to remote working, why not stay in that mode and save money on office rent, etc.? Maybe only some roles need to return to the office. If we do go back, is it five days a week or can we reduce it and work some days from home? Are we just as effective if we remain working from home? The general belief at my company is that we are just as efficient working from home in most cases, but the face-to-face social connectedness is disintegrating. We are in a relationship-building industry that benefits highly from collaboration with others, internally and externally. Innovation and creativity spark from the ability to connect with others. Breakroom chats do not occur when everyone’s working from home. Small talk at the beginning and ending of meetings has mostly disappeared. Meetings are ending early and being scheduled for shorter periods of time. Where I work, we are planning on returning in two phases with a mandatory requirement of two days in the office per week. The first phase would be for people who feel they are not at as much risk considering age, family, health and exposure. A month later, the rest of the team will return to the office. Anyone who is over 55, has health issues, has childcare issues, or lives with someone who has health issues or has been exposed will have the option to work from home even though the rest of the team is returning to the office ... at least for a while until we see better progress in reducing or eliminating the virus. We are taking many precautions such as staggering the days that people are in the office based on where they sit and reducing conference room use to just the larger ones where distance can be maintained. Everyone will be required to wear a mask. We are also incorporating more frequent cleaning and disinfecting of all surfaces, and some surfaces will get disinfected multiple times per day. Each person will be equipped with sanitizing products to clean their offices and cubicles throughout the day. We will all be required to report each day, using a mobile phone app, on our temperature and answer a few questions about how we feel before we can come to the office. Our movements will be tracked and anyone we’ve had contact with will be tracked. Even with all of these precautions, some of the staff are still reluctant and worried that we’re returning too soon. As I said earlier, though, we are “planning” to return. That means we’ll be ready because we have a plan. But it also means that something could happen between now and then that could cause us not to implement the plan yet or adjust the plan if needed. These are very interesting times and are challenging us as humankind on so many fronts. I hope everyone has been able to remain positive and open to change, as it brings opportunities to us.



Ginny l

Member News

Julie A. White, CPA, was promoted to CFO of Habitat for Humanity Central Arizona. Debra L. Fabry Bradley, CPA, continues as the COO. Robert Edward Dubberly, CPA, has been appointed to the Arizona State Board of Accountancy, replacing outgoing board president William C. Heimerdinger, CPA. Robert F. Hockensmith, CPA, has been appointed to the Arizona Board of Funeral Directors and Embalmers. Matthew P. Hatfield, CPA, became a partner at Lohman Company, PLLC. Schutte & Hilgendorf, CPAs, PLLC, has acquired the accounting practice and some tax operations from Holdsworth Chad Fuller CPAs PC (HCF) in Prescott. Rachael A. Bertrandt, CPA, global corporate controller and principal a c c o u n t i n g o ff i c e r f o r I n s i g h t Enterprises, and ASCPA Board member, was named one of the 2020 Women of the Channel by CRN®, a brand of The Channel Company. Congratulations to ASCPA member (and former ASCPA team member) Hayden B. Williams, CPA, CGMA, who was honored by the Washington Society of CPAs with their Chair’s Award for extraordinary commitment and service. Livia Marku, CPA, was promoted to audit manager at CBIZ & MHM.

Highlights of Board of Directors’ July Meeting Among other actions at its July 29, 2020 meeting, the ASCPA Board of Directors reviewed the following:

Consent Agenda The consent agenda, which included the board minutes, was approved.

AICPA Board Liaison Dialogue Okorie Ramsey, the Society’s AICPA liaison, shared insights on the profession as well as his experience as an AICPA board member and CPA leader in industry.

Conflict of Interest Policy Board members reviewed and signed the conflict of interest policy as part of the annual process.

Nominating Committee Approval & Trends Conversation The board approved the following names as members of the nominating committee: Tom Duensing (committee chair), Mike Allen, Marissa Graves, Lauren Murro and Lisa Stevenson. The board also provided insights into valuable experience/skills for future leaders.

CEO Search Update Ginny provided on update on the status of the CEO search being conducted with Duffy Group.

Strategic Plan Update Cindie provided an update on the ASCPA’s strategic measurements.

A Day in the Life Rachael Bertrandt, Anthony Lorenzo and Greg Nelson each shared a view of the challenges and joys they experience in their life and job.

Other Business No other business was conducted.

If you have questions or would like additional information, please contact Cindie Hubiak at (602) 324-2888; AZ toll free at (888) 237-0700, ext. 203; or



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Leadership & Growth Alliance Series

Contemplating a Job Change – Is the Grass Really Greener? by Samantha E. Mahlen, CPA, CFE A career change is one of the hardest decisions a CPA makes. Our job is more than a way to pay the mortgage – it’s packed full of relationships. Leaving the clients you enjoy, the peers you collaborate with, and your work bestie is often difficult to imagine. However, the recruiting industry consistently tempts us with flattery and well-written proposals. We are offered titles beyond our experience, twice the salary, and the shiny opportunity of large bonuses. Then we ask ourselves, is that idiom true? Is the grass greener on the other side of the fence? Maybe. A career change should be carefully and strategically considered. Researching various companies and daydreaming about a new role can be a positive and productive exercise. When it becomes a frequent activity, we should ask ourselves why we’re taking precious time to do so. What is wrong with your current role that results in you entertaining the idea of others? I recently read an interesting piece. The anecdote was accompanied with picture of an older-looking car in a rundown garage. The father said to his daughter, “This car is for you. Take it to the used car lot to see what they’ll offer.” The daughter returned disappointed since they would only pay $1,000. He told her maybe she would have better luck at the pawn shop. She was more disgruntled as they would pay her even less. Finally, he sent her to the car club. She returned excited saying, “Someone offered me $100,000! It’s an iconic car!” To this the father replied, “I want you to know the right place values you the right way. If you are not valued, don’t be angry, it means you are in the wrong place.”

Value is more than just a dollar figure. Your employer can show that you are valued in many ways beyond your compensation package. Unfortunately, an employer and employee may not share the same beliefs regarding the worth of time, collaboration and autonomy. Right, wrong or indifferent, misalignment in any relationship is not conducive to a long-term one. In all relationships, we want to be valued from our own perspective. It is unfair to expect our superiors to know what means most to us without communicating it to them. Many companies default to valuation in the form of an annual raise and bonus. The intention is to encourage and motivate us. If the amount is what we expected or higher, it temporarily does. However, as the excitement fades from our once a year “attaboy,” we need to continue to stay motivated from the other elements of our role. The reason the grass seems greener is because we see something on the other side of the fence we feel we are missing. Some of us thrive on intense challenges. If our workdays consist of monotony and simplicity, we may feel our superiors do not appreciate our skills. Many of us value work-life balance. If the expectation is to clock 65-hour weeks during football season and your fantasy team lands in last place, you may start dreaming of a more flexible opportunity.

Furthermore, there are elements beyond the billable work. A culture of team engagement, community involvement and other activities represents value beyond your technical expertise. A not-so-obvious value add is thoughtful, constructive feedback and clear direction on a consistent basis. These non-monetary values may impact us more than we realize. When we discover there is value misalignment with our employer, it is naïve to believe we can hide it. We sometimes neglect to acknowledge how our subconscious negative feelings result in poor productivity and sub-par workproduct. We can focus on remaining professional, however, body language often communicates our true feelings. It is best to immediately address the elephant in the room. Communication is key to determining if values can be re-aligned or if recruiters will begin hearing from you. Be wary of over-emphasizing monetary and cautious of discounting non-monetary elements of your employment. Identify what you perceive as most valuable to align yourself with a company, mentors and peers with similar views. Remember, CPAs have opportunities in any industry, anywhere in the world. If you are not valued, do not be angry. It means you are in the wrong place. l

Samantha E. Mahlen, CPA, CPE, has been an active member of the ASCPA since 2014 and is an ASCPA Champion and has served on the Emerging Leaders Committee. You can reach her at



Not-for-Profit Virtual Conference Sept. 16, 17 & 18, 2020 Webcast Only — Earn 12 hours of CPE for the price of 8! Get up to speed on the most pressing issues facing not-for-profit organizations today. Plan your perfect day with a mix of auditing, accounting, technology, leadership, strategic planning and tax topics relevant to the changes in the not-for-profit industry due to COVID-19. In a fast-paced accounting world, not-for-profit leaders must know how to operate efficiently and effectively, making the most of their limited resources in an ever-changing and often challenging financial environment.

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Day 1 | September 16 8:30 a.m. – 12:30 p.m. Audit and Accounting Update Allan C. Klose, CPA CBIZ MHM, LLC Strategic Planning: Your Role in Providing Strategic Leadership for Organizations Jayson Matthews ASU Watts College, Nonprofit Management Institute An Update From Washington Brenda Ann Blunt, CPA, Eide Bailly LLP

Strategy Meets Standards — Turning Accounting Standards Into Innovation Curtis James Klotz, CPA (in MN), CLA (CliftonLarsonAllen) Reach for the Stars - Charity Navigator Sarah C. Zelhart, CPA Make-A-Wish America

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Day 2 | September 17 8:30 a.m. – 1:30 p.m. Common 990 Errors Amy O’Loughlin, CPA Kristen M. Bass, CPA CBIZ MHM, LLC KEYNOTE: Better Together — The Notfor-Profit Community in Arizona Kyla Teresa Quintero, CPA, Arizona Community Foundation



Taxes for Tax-Exempt Organizations Brian Ess Henry+Horne Financial Market Update and Investing for Not-for-Profits Jason Gove, CRPC, CWS National Bank of Arizona

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Arizona’s Tax Reactions to COVID-19 by Pat Derdenger and Karen Lowell After the IRS announced in March that it was extending the due date for filing and payment of individual, corporate, and fiduciary income tax returns to July 15, 2020 in order to ease the burden on taxpayers created by the COVID-19 pandemic, many states – including Arizona – followed suit. Arizona also adopted other tax relief provisions relating to transaction privilege tax, although no property tax relief was offered. This article summarizes the guidance and tax relief that was or is available to Arizona taxpayers resulting from the COVID-19 pandemic. Income Tax (Corporate and Personal) — On March 20, 2020, the Arizona Department of Revenue (DOR) issued Arizona General Tax Notice GTN 20-1, announcing a number of extensions relating to income tax filing and payment deadlines. 2019 Filing & Payment Deadlines — The DOR extended 2019 income tax filing and payment deadlines from April 15, 2020 to July 15, 2020. The extension applies to individual, corporate, and fiduciary tax returns. It also stated that taxpayers who file and/or pay after April 15 but on or before July 15 would not be assessed late filing or late payment penalties or interest. (GTN 20-1.) Automatic Extensions — Additionally, taxpayers who requested an automatic extension of time for filing their 2019 federal tax returns from the Internal Revenue Service would be granted a six-month extension (5½ months for fiduciary returns) to file their Arizona returns without the need to file an Arizona extension request. Taxpayers who did not file federal returns could still obtain an Arizona extension by filing an Arizona Form 204 (individuals), Form 120EXT (corporate filers) or Form 141AZ EXT (fiduciary filers). The filing extension did not provide an extension of time to pay any Arizona tax liability, and at least 90% of a taxpayer’s reported Arizona income tax liability was due by July 15 to avoid penalties and interest. Tax Credits — By statute, Arizona extends the contribution period for certain tax credits, including the credits for contributions to certified school tuition organizations, public schools, and qualifying charitable organizations, beyond the tax year in which the credit is claimed. Taxpayers may make contributions between January 1 of the tax year and April 15 of the following tax year and claim the corresponding credit in either tax year. In GTN 20-1, the DOR confirmed that the deadline for taxpayers to make contributions to certified school tuition organizations, public schools, and qualifying charitable organizations and claim the credit on their 2019 income tax return remained April 15, 2020. However, the DOR announced that the due dates for Arizona Form 140ET (Credit for Increased Excise Taxes) and Form 140PTC (Property Tax Refund (Credit) Claim) were extended to July 15, 2020.

Transaction Privilege Tax — In the early months of the pandemic, the DOR did not authorize any relief for transaction privilege tax (TPT) filers. The due date for returns and payments remained the 20th day of the month following the taxable transaction. Additionally, taxpayers were cautioned that if they opted to delay TPT payments or returns that they would be subject to late filing and/or late payment penalties. However, in late June the DOR changed course and announced that it was working with taxpayers struggling to meet their transaction privilege tax obligations as a result of the COVID-19 pandemic on a case-by-case basis. The DOR was assisting businesses in applying for late payment and late filing penalty abatement and said it was prioritizing working with taxpayers rather than taking enforcement actions when reasonable, as this approach was more beneficial to the taxpayer and efficiently serves state and municipal interests. The following week, on June 30, the DOR issued a draft Transaction Privilege Tax Ruling TPR 20-XX and the corresponding Transaction Privilege Tax Procedure TPP 20-XX, the first step in formalizing a procedure for late payment penalty abatement due to COVID-19. In the proposed ruling, the DOR concluded that the severe impact of the COVID-19 pandemic, the statewide emergency declaration and other measures implemented by the state to protect public health, constituted a reasonable basis for business owners and operators’ inability to file or pay transaction privilege taxes, including county excise taxes and municipal privilege taxes remitted to the Department, in a timely manner. The DOR also determined that taxpayers’ failure to timely file or pay would not be considered to stem from willful neglect. The draft procedure also outlined the steps for filing Arizona Form 290 and requesting abatement, including verification that penalties have been assessed, that all returns have been filed and that payments have been made. Following a public comment period that



closed on July 13, the DOR finalized the draft guidance on July 14, 2020 at TPR 20-1 and TPP 20-1. Property Tax — No property tax relief relating to the COVID-19 pandemic is available for Arizona taxpayers: the current payment deadlines for property taxes were not changed or extended. The second-half payment for the 2019 tax year was due on March 1 and was delinquent if not paid by May 1, 2020. The first half payment of 2020 taxes is due October 1, 2020 and delinquent if not paid by November 1, 2020. Property tax due dates in Arizona are set by statute, and county treasurers and other officials lack the authority to extend deadlines or waive penalties for late payment. On March 26, the Maricopa County Treasurer (among other county treasurers) asked the Arizona Legislature to extend the second-half payment deadline for all taxpayers to June 1. They also requested that the Legislature grant all county treasurers statewide the authority to waive all pen-

alties and interest associated with any delinquent property tax. The county treasurers continued to urge the state to extend property tax deadlines in a letter to the Governor that also requested taxpayers contact legislators to voice support for an extension. Nonetheless, the Arizona Legislature did not take any action on property tax deadlines. The COVID-19 pandemic wreaked havoc on the day-to-day operations of many Arizona businesses, and government agencies like the DOR were not immune to its effects. Starting in March, the DOR reduced on-site services at its locations throughout the state, requiring pre-scheduled appointments for taxpayers requiring in-person services, accepting certain forms, correspondence and questions by e-mail and limiting some locations to drop-off services only. The DOR also conducted hearings and conferences with taxpayers telephonically. Taxpayers received assistance in dealing with these modified procedures on June 5, when Governor Ducey signed

Arizona Federal Tax Institute Virtual Conference Nov. 4-6, 2020 — 8 a.m. to 1 p.m. This three-day conference provides a detailed analysis of the current and recurring issues affecting the practitioner who provides tax and estate planning services to the family unit and the closely held corporation. It’s a three-day conference with one-stop shopping for all the latest updates you’ll need to ensure continued success.

Thanks to Gold Sponsors: Bedford Cost Segregation Catholic Charities Community Services Catholic Education Arizona Institute for Better Education



Senate Bill 2021, which requires the DOR to accept electronic signatures as the functional equivalent of written signatures on documents submitted to the DOR. Under the new law, valid electronic signatures must meet all of the following criteria: • Be executed by a person with the intent to sign the document; • Be attached to or logically associated with the information contained in the document being signed; • Be capable of reliably identifying the person as the signer; • Be linked to the document in a manner that would invalidate the electronic signature if the document was changed; • Be linked to the document so as to preserve its integrity; and • Be compatible with standards and technology for electronic signatures generally used by commerce, industry, or state governments. Unlike many states, Arizona did not offer transaction privilege tax payment deferral relief, although the penalty abatement relief offered by the DOR in fact administratively created relief. Nor did Arizona offer any property tax payment relief through deferred payments or waived penalties. To its credit, the DOR has bent over backwards to assist and accommodate taxpayers affected by the COVID-19 virus. What has yet to be considered are the changes to the Internal Revenue Code made by the CARES Act. Arizona has a static conformity date and presently conforms to the Code as it was in effect on January 1, 2019, with certain legislatively-enacted exceptions. It is expected that the Arizona Legislature when it convenes for the 2021 session will take up this conformity issue and determine whether Arizona will conform to the CARES Act changes or decouple from the Code with respect to those items. l Pat Derdenger is a partner and Karen Lowell is an associate with the law firm of Lewis Roca Rothgerber Christie LLP in Phoenix. Derdenger is an author of the Arizona Tax Guide. He can be reached at

ASCPA 2020

Legislative Report by Ryan DeMenna

As the world continues to fight the spread of COVID-19, its impact on our lives is being felt at every level. In Arizona, among the hardest hit states in the nation, the virus brought the 2020 legislative session to a standstill. Despite the policymaking paralysis, the Arizona Society of CPAs, along with its team at DeMenna Public Affairs, accomplished some remarkable legislative victories.




Arizona companies and CTSO:

A powerful partnership that changes lives! In low-income families, many bright, deserving students are shut out of college simply because their families can’t afford it...and high school dropout rates are often over 50%.

But with the help of companies across Arizona, many of these children are getting an exceptional education that is changing their lives! Over the past 20+ years, CTSO has given over 70,000 children in low-income families over $124 million in scholarships. 99% of those students are graduating high school! 98% are college bound! We’ve helped so many, and yet the need for corporate support has never been greater. So many children desperately need help! If your client’s company might want to help, we’d love to talk!

If you have a client whose company might like to join us in changing children’s lives, please give Bill Osteen a call at 520.838.2573 or Gracie Marum at 520.838.2571.We’d love to meet with you!

Save the Date

Governmental Accounting Conference Feb. 5, 2021 www.ascpa/gac21 14


Policymaking in a Pandemic Arizona’s 2020 Regular Session officially ended on May 26. Adjourning for the year, however, was easier said than done. Arizona’s legislative session kicks off every year in early January, and typically lasts four to six months. When the 2020 session began, there were only rumblings of the virus, but by March it became clear that lawmakers might have to hit the pause button. In mid-March, Governor Ducey announced that Arizona schools, many on spring break, would remain closed until March 27. The school closure was subsequently extended for another two weeks. Amid growing concerns over the virus and in light of the Governor’s actions, state legislators immediately worked to pass a “skinny” budget and handful of bills intended to beef up Arizona’s response to the pandemic. By March 23, the Legislature had passed a budget, and adjourned until April 13. The motion to adjourn until April 13 allowed the Senate President and House Speaker to choose another day to reconvene, if necessary. This flexibility proved to be critical after Governor Ducey announced that schools would remain closed through the end of the school year, and issued his executive order asking Arizonans to stay at home. That’s when things at the state Capitol got really complicated. Officially ending the session, known as adjourning Sine Die, requires buy-in from both chambers. In late April, legislative leaders announced their plans to meet on May 1 to Sine Die. This date, at the time, coincided with the end of Ducey’s executive order. After lawmakers expressed concerns that ending the session would kill hundreds of bills suspended in the policymaking process, House and Senate Leadership quickly reversed course. By May 1, the Governor had extended his stay-at-home order two more weeks, and lawmakers were still grappling with how to end the session. As frustrations continued to grow, the Senate decided to convene on May 8 and Sine Die

without the necessary buy-in from the House. A week later, immediately after the Governor ended his stay-at-home order, the House announced that it would resume business as usual, leaving Capitol observers wondering how a single chamber could accomplish anything legislatively in a bicameral process. The House ultimately completed work on 28 bills and sent them to the Senate before adjourning Sine Die on May 21. A reluctant Senate then reconvened to vote on the bills sent over by the House. Instead, a surprise motion to Sine Die was passed, killing all 28 bills in the process. Chaotic, to say the least. As the Sine Die dust settled, a quick review of the legislative “box scores” reveals the extent of the virus’s impact on the policymaking process. In all, lawmakers introduced 1,607 bills – the highest number in Arizona history. Only 90 of those bills were ultimately signed into law – the lowest number in Arizona history. Navigating the Chaos Despite the chaos, the Arizona Society of CPAs had a banner session. Overhauling the state’s various boards and commissions has been a cornerstone of Ducey’s agenda since taking office. This session, the Governor made it clear he would continue these efforts and called for a number of changes, including legislation requiring boards and commissions to have a majority of public members. The Governor said that putting more “real people” on boards would help “chip away at the deep-rooted cronyism.” Ducey recruited Senator Michelle Ugenti-Rita to sponsor the legislation, and argued her bill was necessary to address the North Carolina v. N.C. Dental ruling – a 2015 Supreme Court decision declaring that licensing boards primarily comprised of industry professionals create an inherent conflict of interest. While well intentioned, the proposal was, at best, imprecise. Addressing a wide range of boards and commissions, the legislation lumped the State Board

of Accountancy in with the Board of Barbers, the Board of Cosmetology, the Board of Funeral Directors and Embalmers and the Board of Massage Therapy, to name just a few. The Society immediately engaged the bill sponsor, legislator and the Governor in an effort to have the State Board of Accountancy removed from the bill. Unfortunately, the Society joined a choir of professional and occupational opposition – each claiming to be unique, and each asking to be removed from the bill. Fortunately, CPAs are unique. As practitioners well know, the Board regulates the CPA credential and not the practice of accounting. The Society argued that Arizonans can open an accounting, tax preparation or financial planning firm today and not be required to obtain licensure from the Board. The barrier to entry argument simply doesn’t apply. Again, the legislation was imprecise. The Society deployed a multifaceted legislative strategy to make this important distinction known to every member of the legislature. The Society met with legislators, crafted legal opinions and prepared educational materials. The Society also asked its members to engage, and the overwhelming response from the CPA community proved to be invaluable. Ultimately, the legislation became law ... and the State Board of Accountancy was the only board removed from the bill. On a parallel track, the Society also managed to pass a notable priority bill. In 2018, the Society partnered with the Board to craft legislation that would reduce regulation and streamline business services. Senate Majority Leader Rick Gray, at the request of the Society, sponsored the 2020 follow up to that successful legislative effort. Gray’s bill simplified the Continuing Professional Education approval process and made additional improvements to Board procedures and customer service. The Society worked strategically to ensure that this bill made it to the



Governor’s desk, despite ongoing opposition to the Ugenti-Rita legislation, and despite the legislative chaos caused by the pandemic. In a year when only 90 bills were signed into law, the Society and its members should be especially proud of these legislative accomplishments. Beyond these heavy legislative-lifts, the Society worked to ensure that Arizona passed its annual federal income tax conformity legislation, aligning Arizona’s tax code with the changes made to the Internal Revenue Code – an ongoing effort in light of the CARES Act and other federal changes approved in response to COVID-19. The Society also tracked and provided critical feedback to legislators and staff on hundreds of bills advancing through the policymaking process and partnered with the Governor’s office on Board appointments. In these unprecedented times, and in light of the various federal funds being made available to combat the virus, a fully-functioning

Board is more important than ever. Again, it was a banner session for the Society. A Winning Team This year’s extraordinary legislative accomplishments were made possible by YOU — leaders in the profession willing to dedicate the time necessary to engage policymakers and make your voice heard in the lawmaking process. It goes without saying, however, that the energy behind the Society’s advocacy efforts comes from the experience and leadership of Cindie Hubiak. Advocacy at the Legislature is more important than ever. Knowing this would be the case, Cindie Hubiak rose to the challenge years ago and worked to ensure the ASCPA had the structure and team in place to address both the known and the unknown in the policymaking arena. ASCPA Director of Government Affairs John Baumer continues to assist the Society in these efforts.

The successes of the 2020 legislative session, in light of the unprecedented chaos, only serves to reinforce the view of the Society as the poster child for advocacy at the Arizona State Capitol. l

Ryan DeMenna is with DeMenna Public Affairs, the ASCPA’s lobbying firm. For more information, contact www.

Lisa Riley, PhD, CBI, CM&AP BR640982000 480.686.8062 7502 E Pinnacle Peak Road Suite B219 Scottsdale, AZ 85255

Kathy Brents, CPA,* CBI Broker, Managing Member

*licensed in AR


Kathy Brents

Selling your accounting firm is complex.

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ASCPA PAC Report The ASCPA is a well-respected voice at the Arizona Capitol, renowned for providing guidance, input and expertise in the world of tax, accounting and finance. The ASCPA PAC allows us to advocate for incumbent legislators and candidates who know our issues and support this profession and the commonsense goals we pursue. The ASCPA PAC and the Society’s leaders contribute money to a wide variety of candidates, current lawmakers and both major political parties. Thank you to the ASCPA members who contributed more than $59,800 last fiscal year to open doors, share ideas and make sure the CPA voice was heard. Please help make sure Arizona CPAs have a strong voice with legislators and the political process, donate to the PAC today at Total PAC Contributions: $ 59,800 Total Contributed to Candidates/Causes: $ 47,750

2019-2020 PAC Contributors ($250 or more) Karen K. Abraham Anthony Alfonso Michael T. Allen Mark M. Anderson Cord D. Armstrong Susan A. Armstrong Corey Arvizu Anita F. Baker Patricia L. Bambridge Steven E. Bandler Bruce D. Beach Rachael A. Bertrandt R. G. Blake Brenda A. Blunt Francis J. Brady Randy G. Brammer Richard A. Bratt James F. Brewer Christine Brueser Jay L. Buck Donald Butler II Ronald Butler, Jr. Debra A. Callicutt Kevin F. Camberg Brian J. Campbell Joy C. Cervantes David J. Cohen

George M. Cohen Christopher T. Coots Anne Cornelius Andreas D. Coumides, Jr. Keith R. Cowan Regina R. Curry David M. Damron Kelly K. Damron Benjamin L. Darwin Deloitte & Touche LLP Edward Demosthenes Virginia E. DeSanto Craig Desnoyer Gary R. Dietrich Bradley S. Dimond Mark R. Dreher Michael C. Drexler Robert E. Dubberly Thomas F. Duensing Richard B. Eggleston Paul Evans Matthew O. Everroad Evan C. Feldhausen Lawrence Field Michael T. Finnegan Marc D. Fleischman Randy G. Fletchall

Barry R. Friefield Thomas L. Friend Anthony R. Gerlach Rufus Glasper Alan Gold Richard H. Goldenson Charles H. Goodmiller Christopher J. Gracey Jacob P. Gregory Anthony M. Hakes Sean Hales Stephen T. Harris Victoria C. Harris Brian J. Hemmerle George E. Henderson R. Dale Hensley William J. Hodges, Jr. Herbert J. Hoffman Cindie Hubiak Daniel B. Hughes Terri M. Hulse Carolyn B. Iacobelli David M. Iaconis Charles J. Inderieden Michael B. Jacobson Steven L. Jenkins Colette Kamps Evelyn A. Kleinhans Julie S. Klewer Allan C. Klose Richard C. Kudzmas Jeffrey E. Kuhlin Chad D. Kunze Mark L. Landy Susanne M. Landy Donna H. Laubscher Michael D. Lemme Andrea B. Levy Chris W. Ludwig Vanessa R. Makridis Robert E. Malitz Johannes J. Marais Alexander Marr Karen Mattull Karen K. McCloskey Phillip R. McCollum, Jr. James S. McGettigan Kevin W. McHolland Charles A. McLane Norman R. Mendoza II Julia A. Miessner David G. Miller Jr. Bryan W. Mogensen John M. Murdough Dan Nahom

Melinda K. Nelson W. Gregory Nelson Amy A. O'Loughlin Randall L. Ottaway Brent Papek Jay Z. Parke David P. Phillips Jonathan M. Poppel Bradley J. Preber John W. Prenzno Sami K. Raynes-Houseknecht Daniel R. Roder Christina C. Roderick Stephen J. Rodis Jay R. Rold Eric S. Rudner LeAnn M. Rudolph John P. Russo Steven Rutti Stephen J. Schiltz James A. Schmidt Carolyn S. Sechler James Shankland Stella M. Shanovich Jill A. Shaw Jennifer L. Shields Layne R. Simmons Jeffrey Z. Singleton Jeremy A. Smith Andrew M. Spillum Leslie B. Stackpole Ronald L. Stearns Michael E. Straneva James M. Susa Steven L. Tait Philip W. Taylor Chad Thurston Mark Tichinel Candace B. Tooke Christopher W. Tyhurst Peggy H. Ullmann Jared W. Van Arsdale Scott T. Wallace Brooke M. Westemeier Pamela D. Wheeler Kelly M. White Cale L. Whittington Peter Wieghaus Corrine G. Wilson Robert Wyndelts Dominic J. Zamora Scott R. Ziemer Timothy P. Zingraf Edward K. Zollars



ASCPA Preferred Providers

The ASCPA collaborates with the following providers to bring you high quality products and services.

CPACharge CPACharge gives you a professional way to accept credit, debit, and eCheck payments in your office or online, with no equipment or swipe required. Give your clients the convenience of paying with the click of a button, while you get full daily client payment deposits, complete transaction details, and robust reporting for easier reconciliation. Our system is PCI Level 1 compliant, so payment data stays safe and private, and our team of in-house payment experts is here to ensure your success. Trust our experts for a solution that’s used by 150,000 professionals — CPACharge. Sign up now to get your monthly program fee waived for the first three months. For more information, visit or call (844) 352-4705.

CAMICO As the nation’s largest CPA-owned and directed program of insurance and risk management for CPAs, CAMICO features benefits such as deductible reductions for early reporting of potential claims, “continuity of coverage for potential claims,” and cyber coverages with breach response services. Policyholders have unlimited access to in-house experts, subpoena and consultation services, assistance with potential claims and reported claims, 100+ sample letter templates, loss prevention advice and more. Visit www.camico. com or call (800) 652-1772 to speak with your CAMICO representative.



Paychex, Inc. Paychex, Inc. (NASDAQ: PAYX) is a leading provider of integrated human capital management solutions for payroll, benefits, human resources, and insurance services. By combining its innovative software-as-aservice technology and mobility platform with dedicated, personal service, Paychex empowers small- and medium-sized business owners to focus on the growth and management of their business. Paychex is proud to be the preferred provider of payroll, retirement, and HR services for the ASCPA and its members. ASCPA members are eligible for benefits for their firm, as well as discounts to refer to clients. New Paychex clients referred by ASCPA members will receive one month of free services on payroll, retirement, and/or HR services, and a six-month, money-back satisfaction guarantee on payroll and retirement. ASCPA member firms enjoy discounted payroll processing (up to 50 employees) upon subscribing to our CPA Member Program. Members also have access to 401(k) Plans for Firms, AICPA’s comprehensive 401(k) recordkeeping service, providing thousands of fund choices, and fiduciary services accompanying your existing financial advisor. Managing payroll and employee benefits is even easier when they are seamlessly integrated. Encourage your clients, and your own firm, to visit us online ( or contact a local Paychex branch (https://locations.

Steps for Your Clients and Business to Survive Crisis and Recover by John S. Stoner, CPA (in PA), CVA The coronavirus pandemic abruptly shifted the CPA practitioner’s focus from business planning for client growth to simply planning to keep their clients’ heads above water. Standard business operations and commerce were frozen by the efforts to contain the spread of the deadly COVID-19. The time frame associated with the disruption was never clear, and various governmental assistance programs were instituted to provide some economic relief. Despite the efforts, business owners have been concerned that the relief wouldn’t be sufficient to ride out this unprecedented storm. Practitioners can help their business clients improve their chances of survival by systematically and honestly addressing the following concerns.



Take the Steps Toward the Retirement You Deserve Grow Your Practice by Double Digits as You Have Prepared! Stand Up for Arizona and Plan the Future of Our Profession! Remember 2020 as the year we stepped up! Experience shows that combining and strengthening practices has a lot of value and benefit during periods of economic uncertainty. We have practices preparing to sell in 2020 and the partners are anxious to work with buyers for a strong transition, assist with training staff, maintain client confidence and satisfaction. Financing has been confirmed as available. Now is the time for sellers and buyers to plan their future optimistically and contact Able Tax and Accounting Practice Sales for a confidential/no obligation discussion about Stepping Up in 2020.

Gary W. Hankins, CPA • Able Tax and Accounting Practice Sales • • (817) 738-3287



Resource Prioritizing – Health care professionals use triage to determine the priority of treatments based on severity and need. Your business clients can benefit from a sort of triage by assessing and prioritizing their immediate business needs. Make sure they consider the following: • How dramatically have normal business activities been disrupted? • How will the disruption impact revenue streams? • What financial resources are on hand to support cash flow needs? • How much borrowing capacity do they have? • What cost-containment measures can be taken? • How long can the business hold out? Scenario Planning — This effort entails making assumptions on what the future might be like and how the business would be affected under those circumstances. Through this exercise, clients can identify a set of uncertainties or different realities that can impact the business. COVID-19 has created a lot of disruption, so a realistic assessment using different underlying assumptions related to various uncertainties will result in dramatically diverse outcomes (i.e., best-case to worst-case scenarios). Here are some scenarios you and your clients can delve into: • How long will normal business operations be disrupted? • Will key business relationships (customers and vendors) survive? • Will accounts receivable be collected? • What will be the demand for their products and services going forward? • What cost-containment measures can be implemented? • What are some sources of relief, and how much can be realistically expected? Financial Forecasts and Cash-Flow Projections Based on Scenarios — Forward-looking financial and cashflow projections, derived from the

underlying assumptions in scenario planning, will provide the best available information for clients to make informed strategic and operational decisions. The situation can change rapidly and dramatically, so continual reassessment of the likely scenarios and financial impact to the business is necessary. Communicate — COVID-19 has always been both a health and financial crisis. Clear, honest and straightforward communication is essential. Sometimes difficult decisions must be made to save the business. These may include employee layoffs, furloughs, compensation reductions and other financial hardships. Therefore, clear and routine communication is necessary to rally the troops inside the business and to stay connected with outside partners. Your client should be as transparent as possible about the current situation and the rationale behind tough decisions,

delivering messages with compassion, empathy and acknowledgement that the entire staff is in this together. Consider the Recovery Possibilities – Unfortunately, not all of your clients will be able to survive this historic catastrophe. Some will cease operations, be forced to sell off their assets, or merge with a stronger organization. For those that make it through, here are important considerations for future success: • How will the pandemic’s economic crisis alter the way commerce is conducted, and what does that mean for your client’s current business model? • Is the client still relevant to key customers; if not, what changes should be considered? • Can your client incorporate new crisis survival tactics (working remotely, leveraging technology, certain cost-containment proce-

dures, scenario planning, etc.) into their operating procedures? • What new opportunities are available and how do they seize them? Seemingly out of nowhere, the global business community has gone from “business as usual” to “crisis mode.” But this traumatic experience, and the lessons learned, will forge a new appreciation for the strength of the entrepreneurial spirit that will lead to our financial recovery and whatever the “new normal” may be. l John S. Stoner, CPA (in PA), CVA, is a partner in the business consulting services group of RKL LLP. He can be reached at This article was reprinted with permission from Pennsylvania CPA Journal.

Don Famer’s Virtual Tax Update Oct. 30, 2020

On Webcast Recommended CPE Credit: 8 hours Get the latest on 2020 developments with practical solutions to problems and tax planning opportunities. Join Farmer and your peers for a review of the major developments in federal income taxation for individuals and businesses having the greatest impact on participants, clients and companies. The seminar includes a review of: the latest developments and guidance for important TCJA provisions; SECURE Act provisions first effective in 2020, and other significant 2020 tax legislation. Farmer will also share releases regarding the Taxpayer First Act, proposed regulations for determining when contributions to charitable organizations are deductible as trade or business expenses, new tax cases, rulings and regulations expected to have the most significant impact on individuals and businesses.

Register online at or by phone at (602) 252-4144

In addition to the 200+ page digital reference manual, you will receive: • A checklist of developments first effective in 2020 • A checklist of expiring and/or recently expired tax provisions • Selected new or modified federal tax forms for 2020

Thank You to Our Sponsors: Paychex, Jewish Tuition Organization, CPACharge, Arizona Community Foundation & Catholic Education Arizona SEPT./OCT. 2020 AZ CPA 21

Classifieds Business Opportunities ESTATE/GIFT TAX AND FAMILY SUCESSION PLANNING issues pose a challenge for you? I can work with you or your client. Estate planning/ compliance is not a science; it’s an art. Let’s make a better plan for your client. Ira Feldman, CPA/CEP (602) 850-5101 or Website: SEEKING CPA SELLERS! Selling in 2020? — Selling your firm is complex. ACCOUNTING BIZ BROKERS can make it simple. With over 23 years of combined experience in selling CPA firms, our process is confidential and we work hard to bring you the “win-win” deal you are looking for! Our brokers are all Certified Business Intermediaries (CBI) specializing in the sale of CPA firms. Knowing what your firm is worth is the first step, so CONTACT US TODAY to receive a free

market analysis or to start the confidential sales process! Kathy Brents, CPA licensed in AR, CBI (866) 260-2793 office, (501) 514-4928 cell, Kathy@ Employment TULL, FORSBERG & OLSON, PLC — The opportunity is here, now, for a Tax Manager to be a part of the management team and to have ownership in the next 1-2 years in a well-established and growing local CPA firm. Be a part of directing the future of our Firm. We will challenge you to be a leader, excel in your tax knowledge, provide world class service to clients, and to search for creative solutions that help clients grow their businesses. 8 years of public tax accounting experience, preferably with manager level experience. Contact Tim Fyan (602) 277-5447; or tfyan@

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Office Space OFFICE SPACE FOR LEASE — Beautiful garden-style office complex in a great office environment located in north Phoenix. Easy access to SR 51 and SR 101 just north of NWC of Tatum and Shea Blvd. Executive office $800. Ample parking, beautiful conference rooms and seminar room. Copier, telephone and internet ready. Includes Receptionist to greet your clients. Contact Clara or Mary at (602) 953-5000. OFFICE SPACE IN CENTRAL PHOENIX (16th Street Corridor) Recently renovated office space approx. 1,150 with separate entrance and opening into courtyard. Available in premiere professional location with great visibility. Access to breakroom & conf. room. Call Ira at (602) 850-5101, or e-mail PROFESSIONAL WORKSPACE AVAILABLE — Looking for a professional workspace in a great executive office environment located in OLD TOWN Scottsdale? Two offices available as follows 150 sq. ft. office for $850 per month and 120 sq. ft. office for $700 per month. Access to conference room, telephone and internet ready. Receptionist to greet your clients and ample covered parking. Call Wanda at (480) 626-3452 to make arrangements to see these offices.

For more information on classified advertising, go to and click on classifieds.

AZ CPA Quick Quiz You’ve Read It, Now Get Credit Take this quiz on AZ CPA content online or submit this hard copy. Receive a score of 70 percent or more and earn one hour of CPE credit in specialized knowledge. It’s that easy! Fees: Members: $25 Nonmembers: $40 Online Access Go to to access links to all active quizzes. Once a quiz is purchased, a link and password will be emailed to you. Your results will be sent immediately after completion, and certificates are emailed within two business days. Hard Copy Please select one answer for each question. Fill out registration/payment information below and mail or fax to the Society office. Quiz results and certificates will be emailed to the address provided on the registration form. *This quiz will be available until October 2022. Please note that users have three attempts to pass the quiz with at least a 70 percent score.

September/October 2020 Issue of AZ CPA* 1. In this month’s Chair’s message, Ginny De Santo mentions something that may be disintegrating when working from home: m Billable Hours m Face-to-Face Connectedness m Manager Oversight 2. What did the ASCPA Board of Directors do at its last meeting? m Signed the Conflict of Interest Policy m Approved the Nominating Committee m All of the Above 3. What important value did Samantha Mahlen say makes a difference in career satisfaction? m Value Alignment with Employer m Regular Increases in Salary m Camaraderie With Co-Workers 4. In GTN 20-1, the DOR confirmed that the deadline for taxpayers to make contributions to certified school tuition organizations, public schools and qualifying charitable

organizations on their 2019 income tax return remained April 15, 2020. m True m False 5. The first half payment of 2020 Arizona property taxes is due on: m October 1, 2020 m Jan. 1, 2021 m April 15, 2021

6. On June 5, Governor Ducey signed Senate Bill 2021, which: m Allowed Taxpayers to File Taxes by July 15 m Mandated Masks m Required the DOR to Accept Electronic Signatures 7. Arizona lawmakers introduced 1,607 bills – the highest number in Arizona history. How many were passed? m 90 m 221 m 375 8. The ASCPA PAC raised how much money last year? m $11,200 m $36,000 m $59,800 9. What is NOT one step that was recommended to help business recover from a crisis: m Scenario Planning m Resource Prioritizing m Communicating Daily 10. What crisis survival tactic was mentioned in Stoner's article: m Leveraging Technology m Cost Containment Procedures m Both of the Above

Quick Quiz Registration Name: ____________________________________________________ Email:_____________________________________________________ Telephone: _________________________________________________


m Member: $25 m Nonmember: $40 Checks: Please make payable to: The Arizona Society of CPAs Credit Card:

m Visa m MasterCard m American Express

Credit Card #: _______________________________________________ Expiration Date: _____________________________________________ Name on Card. _____________________________________________ Mail to: ASCPA, 4801 E. Washington St. Suite 180, Phoenix, AZ 85034-2040; fax to (602) 252-1511 scan and send to



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