Disclosures: November/December 2014

BROUGHT TO YOU BY THE VIRGINIA SOCIETY OF CPAs

IRS regulatory changes

NOVEMBER/DECEMBER 2014 I VOL. 27 NO. 6 I WWW.VSCPA.COM

2014 tax season toolkit

Veterans in the profession

Business management for athletes and other high-net worth clients

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INSIDE this issue

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COVER STORY >>

High-net worth individuals are placing an increasing priority on protecting their assets and preserving their wealth, and CPAs can provide high-level business management services.

ARTICLES

FEATURES GET IN THE GAME

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High-net worth individuals like athletes and celebrities require more financial management than simply tax returns.

2014 TAX SEASON BEGINS

TAXATION

AD INDEX 12

Averett University Beth A. Berk, CPA Digital Benefit Advisors Nationwide Insurance PNC Bank Poe Group Advisors

Federal tax changes for next year

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Use this toolkit for all the changes and updates in Virginia you will need to know for the 2014 filing season.

SECTIONS BACKTALK

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VETERAN CPAs

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Military service prepares CPAs for challenges in the accounting field, and vererans are great team members.

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PROFESSION’S PAST

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VSCPA FINANCIALS

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VSCPA NEWS

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VSCPA EDUCATIONAL FOUNDATION

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CLASSIFIEDS

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I AM THE VSCPA

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disclosures is published bimonthly for members of the Virginia Society of CPAs.

Virginia Society of Certified Public Accountants

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BACKTALK you said it

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4309 Cox Road Glen Allen, VA 23060 (800) 733-8272 Fax: (804) 273-1741 www.vscpa.com

FROM THE VSCPA FACEBOOK PAGE >>

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disclosures http://disclosures.vscpa.com EDITORIAL STAFF Jill Edmonds Managing Editor disclosures@vscpa.com Chip Knighton Contributing Editor cknighton@vscpa.com Jenny Chu, CAE Marketing & Communications Director jchu@vscpa.com EDITORIAL TASK FORCE Joan D. Aaron, CPA Lindsay S. Andrews, CPA Adam G. Chaikin, CPA David L. Cotton, CPA Gary D. Dittmer, CPA Elizabeth M. Helle, CPA Clare K. Levison, CPA Kevin S. Matthews, CPA David R. Peters, CPA George D. Strudgeon, CPA Barbara C. Sukramani, CPA Thomas L. Visotsky, CPA DEADLINES Articles and advertising for future issues are due by 5 p.m. on the following dates: Jan./Feb. 2015 March/April 2015 July/Aug. 2015 Sept./Oct. 2015 Nov./Dec. 2015 Jan./Feb. 2016

Nov. 3, 2014 Jan. 5, 2015 March 2, 2015 July 6, 2015 Sept. 1, 2015 Nov. 2, 2015

Statements of fact and opinion are made by the authors alone and do not imply an opinion on the part of the officers, members or editorial staff.

Auditor of Public Accounts (APA) Crew #1 at Habitat build. Unfortunately the rain chased us away (power tools and slippery deck do not mix well) but they said we can try again tomorrow. #CPAService MARTHA MAVREDES, CPA, Virginia Auditor of Public Accounts, Richmond

VIA FACEBOOK >> A CPA hits the nail on the head. Enough politics.

Enough us vs. them. Here’s the enduring solution for leading America to its best. vimeo.com/89309321 JOSEPH ZANCO

See page 34 for more Day of Service photos!

From the

TWITTERSPHERE >> Overheard in the hallway at my VSCPA conference: “If he likes messin’ with cows, he’ll love that job”. — @VTHOKIES2013 And just got called out for live-tweeting the event #publicembarrassment #twitterchamp #VSCPA Thanks @VSCPANews staff for selling me out! — @EKIMOFFCPA In Richmond this morning to talk with the vscpa business valuation conference about the State of the World @VSCPANews — @GSCLEMONS

VIA VSCPA.COM >> From the VSCPA profile of Councilor, Buchanan & Mitchell partner Pete Reilly, CPA This is a very inspiring story. Makes me want to get back in the water. Congrats Pete and Duke!

CHESTER FLEMMINGS

BLOG: www.cpacafe.com CONNECT: http://connect.vscpa.com TWITTER: @VSCPANews, @FinancialFit LINKEDIN: http://tinyurl.com/VSCPALinkedInGroup FACEBOOK: www.facebook.com/VSCPA INSTAGRAM: www.instagram.com/VSCPA

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At the Virginia Society of CPAs, we love to hear from you.

Whether it’s a quick email to a staff member, chat on the phone, Disclosures letter to the editor, tweet, blog comment or something different altogether, let us know what you’re talking about, how you feel about different issues affecting CPAs and how we can help.

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Members cautiously optimistic on economy

Virginia CPAs are split at 50 percent about whether the U.S. is in a sustainable economic recovery, with 34.21 percent believing that the recovery will take more than four more years, according to the results of the VSCPA 2015 Virginia Economic Outlook survey.

Respondents named “infrastructure” as the most pressing issue in Virginia. “Health care costs” followed closely behind. These results were the top two most pressing issues identified in the 2014 survey as well.

Fifty-five percent of respondents believe that the employer mandate for the Affordable Care Act (ACA) will have a major effect on the economy, with 74 percent believing the ACA is hurting the economy overall.

Forty-eight percent of respondents think that the ACA should be

repealed, while 52 percent believe it should be reformed.

Respondents rated the overall business climate in Virginia, with 81.64 percent feeling “excellent” or “good” about Virginia’s economic outlook as compared to neighboring states, down from 85 percent from the 2014 Outlook Survey.

The VSCPA and Virginia Business magazine joined forces for a panel discussion of the survey results Sept. 17 at VSCPA headquarters with members Charlie Equi, CPA, Greg Lawson, CPA, Ryan Losi, CPA, and VSCPA Board of Directors Chair Colette Wilson, CPA. Watch the discussion at www.vscpa.com/EconomicExpectationsPanel and read more about it in the November issue of Virginia Business. Check out page 30 for more info. n

>> EXCELLENT EXCEL: SAVE TIME WITH MACROS Just like most audit shops, the Virginia Auditor of Public Accounts (APA) requires staff to use a standard structure for referencing audit evidence. In ye olde days of hard copies, the referencing was simple. Now that evidence can be buried within the system, these references have become complicated. To reduce the time needed to write out these system references, I created a macro in Excel that takes the machine readable hyperlink and converts it to a structure that anyone can follow. What I have learned from this experience is that creating and executing macros in Excel is not all that hard and can be a great time-saver.

Macros are good for routine tasks that you find yourself doing over and over again in Excel. Before you can create a macro for those routine tasks, you will need to display the Developer tab at the top of your workbook and enable macros. After you know what tasks you want the macro to

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complete, click on Record Macro, give it a name, assign it a hotkey and then go about completing the tasks yourself.

While you are doing this, Excel records everything you do so that it can perform the same steps when you give it the command to run the macro. When you are done, click stop. You can now use the assigned hotkey to make your macro run in a flash. In summary, if you have predictable routine tasks with multiple steps that you complete in Excel, consider outsourcing them to a macro and save yourself and your employer some time. n GEORGE D. STRUDGEON, CPA, CGFM, is an audit director at the Virginia Auditor of Public Accounts in Richmond. He is a member of the VSCPA Editorial Task Force. Email him if you have Excel topics you want him to cover. george.strudgeon@gmail.com connect.vscpa.com/GeorgeStrudgeon

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Taxpayers do have rights (even if they don’t know it)

STEERING VIRGINIA’S ECONOMY

With tax season looming, it’s a good time to review the “Taxpayer Bill of Rights,” a document released by the U.S. Internal Revenue Service (IRS) in June. The IRS created the document so taxpayers can easily understand their protections. National Taxpayer Advocate Nina Olson recommended such a document in her annual reports to Congress for the last seven years, and her office drafted the “Bill of Rights” released by the IRS. According to the document, taxpayers have: >> >> >> >> >> >>

>>

>> >> >>

The right to be informed The right to receive quality service The right to pay no more than the correct amount of tax The right to challenge the IRS’s position and to be heard The right to appeal an IRS decision in an independent forum The right to finality (e.g., to know the maximum time for challenging an IRS position, for being audited, or when an audit is finished) The right to privacy (e.g., IRS compliance with laws and respect for due process in inquiries, examinations, enforcements, etc.)

The right to confidentiality of information provided to the IRS The right to retain representation The right to a fair and just tax system

The “Taxpayer Bill of Rights” is necessary, according to the Taxpayer Advocate Service, because a 2012 survey revealed only 46 percent of taxpayers knew they had rights before the IRS. Only 11 percent knew what those rights were.

CPAs can communicate these rights to clients and help educate taxpayers on their protections. “Your Rights as a Taxpayer” is available from the IRS at www.irs.gov/pub/irs-pdf/p1.pdf. n

Where should the Commonwealth’s economy go from here? That’s the directive for a new group created

by Gov. Terry McAuliffe in August. In an executive order, McAuliffe created the New Virginia Economy Strategic Plan and Steering Committee to determine economic priorities for his term. Virginia Secretary of Commerce and Trade Maurice Jones will lead the group, which will develop a proposal by Dec. 1, 2014.

Jones was a featured speaker at the VSCPA Top Firms Roundtable, held Sept. 29 at the CPA Center in Glen Allen. Visit www.vscpa. com/TopFirmsWrapup for a recap of the event, including an interview with leadership expert Tom Epperson of Luck Companies, or scan the QR code, right, with your smartphone.

The steering committee will focus the future of Virginia’s economy around these five core areas: >> INFRASTRUCTURE: Are Virginia’s assets and resources ready to attract businesses?

A GREAT YEAR, RECAPPED >>

>> DIVERSITY: Is the economic environment diverse enough to attract high-growth industries?

STATE OF THE VSCPA REPORT NOW ONLINE

>> BUSINESS CLIMATE: What incentives does Virginia offer, and are they attracting the right businesses?

The VSCPA has released its “State of the VSCPA” report for 2013–2014, recapping the membership year that ran from May 1, 2013–April 30, 2014. You can also view the VSCPA’s full audited financial statements in the “For Members” section of www.vscpa.com. Visit www.vscpa.com/ StateOfTheVSCPA to see what we’ve been up to. n

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>> INNOVATION: Are we encouraging entrepreneurship? >> WORKFORCE: Are Virginia’s students being prepared by higher education for the opportunities available?

Find out more about the Commonwealth’s economy at https://commerce.virginia.gov. n

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DATA draft

O THE BEST CITIES AND COUNTIES? VIRGINIA HAS ‘EM

SEVEN YEARS LATER >>

Accountants see sunny skies ahead It hasn’t happened since 2007, but U.S.

accountants are living with more optimism. The third quarter Business & Industry Economic Outlook Survey by the American Institute of CPAs (AICPA) discovered accountants’ optimism about the economy and their companies’ futures is at pre-recession levels.

Survey results showed that economic optimism rose from 22 percent to 52 percent since the third quarter of 2012. Among barometers for individual companies, respondents project growth in revenue, profit and head count. Optimism doesn’t outweigh the fact that challenges do exist. Notably, professionals are most concerned about regulatory requirements and changes, domestic economic conditions, availability of skilled personnel and employee/benefit costs. Increased health care costs are a large part of that, too.

Oatlands Plantation is in Loudoun County, outside of Leesburg.

What do VIRGINIA BEACH, ALEXANDRIA and CHESAPEAKE all have in common? They were all named to the “America’s 50 Best Cities to Live” list from 24/7 Wall St. The list ranked the best of 550 cities with populations of more than 65,000 in 2012, looking at crime, economy, education, housing, environment, leisure and infrastructure.

Not to be outdone, two Virginia counties achieved accolades of their own. LOUDOUN and FAIRFAX were ranked No. 1 and No. 3, respectively, on a list of America’s 10 best counties complied by real estate brokerage Movoto Real Estate. Median household income was a factor, as well as unemployment rate and high school graduate rate, among others. n

More information on the Economic Outlook Survey is at www.aicpa.org. n

CPA firm revenue up for third year Just how much as the CPA profession recovered since the recession?

By looking at firm revenue, pretty well. The Rosenberg Survey found that firms saw a 6.7 PERCENT revenue increase in 2013 — a 1.3 percent jump over 2012. It was also the third consecutive year firms saw increases since the recession began. Other notable results: >> Women on the rise? In 2013, 16.4 PERCENT of partners were female, as opposed to 15.6 percent in 2012. >> The partner compensation gap between large and smaller firms continues to widen. Those partners at firms with revenue more than $10 million see compensation 41 PERCENT higher than counterparts at firms with revenues less than $10 million.

Visit www.rosenbergsurvey.com for info on how your firm can participate in the survey. n

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>> BY THE NUMBERS

11 Virginia’s national ranking among states for women’s employment and earnings, compiled by the Institute for Women’s Policy Research. However, the Commonwealth was ranked 32nd when it came to income disparity: women earn 76.9 percent of men’s pay, which is under the national average. Washington, D.C. was ranked No. 1 overall, placing highest in every category. n

HTTP://DISCLOSURES.VSCPA.COM

Attention CPAs:

Whether A Decision Maker Looking To Upgrade Your Talent, Or A CPA Looking to Upgrade Yourself/Your Skills, Ask Yourself: Who really chose who in joining your company?

Are you/your professional staff really at the right level where you should be/you need them to be?

Are you/your staff in a position that truly suits your/their personality, values, and professional and personal needs?

Why leave your future to chance?

If you’re seriously interested in making the “right” move for your next hire, I can help you.

I am an actively licensed CPA in Maryland and Virginia with over 20 years of experience including public accounting (E&Y) and consulting (KPMG), financial accounting (American Cancer Society), internal audit (Moneyline Telerate), and recruiting (Acsys, formerly Don Richards). As a networker who truly enjoys helping others and sharing my career experiences to guide fellow professionals, here is how I can help you: Decision Makers:  Ask you questions, and most likely ask many more questions than other recruiters about your company, duties involved, skills required, corporate culture and more  Work with you on finding the “right” professional that is the “right fit”  Provide you with valuable information about the professionals I work with, the marketplace, what your competitors pay, and more Career Seekers:  Guide you on career paths available in public accounting and industry  Enable you to capitalize on your strengths  Coach you on how to put your best foot forward to find the “right fit”  Advise you when to stay in your current position if that is the right move If you’re interested in working with a recruiter who understands your background, skills, and is genuinely interested in helping you find the “right fit”, then I welcome meeting you!

BETH A. BERK, CPA, CGMA

Independent Recruiter

Phone: 301-767-0670 Email: BethABerk@msn.com

Specializing in CPA Firm, Accounting & Finance Positions in Metropolitan DC & Nearby Suburbs/Baltimore/Richmond/Tidewater

Connecting You To Your Next Hire

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Contingency & Retained Staffing Solutions

matching skills, experience & values with needs

CPA Ambassador for the state of Maryland, sponsored by the AICPA and Ethics Instructor for VSCPA

Serving clients and professionals as an Independent Recruiter since March 2005

PROFESSION’S past 25 YEARS AGO >>

Taxes on Internet sales and use

BY DAVE COTTON, CPA

state’s favor — i.e., that the state could collect taxes from Quill. Paula’s article provided an excellent description of how the issue affected states’ revenues, but also explained the complex implications for accountants and auditors who had to deal with the ramifications of these tax collection efforts and compliance issues. (If you are interested in seeing her article, email me and I will send it to you.)

So, how was the controversy resolved? Well, it hasn’t been. The Supreme Court of the United States (SCOTUS) overturned Quill v. North Dakota on May 26, 1992 (shortly after Paula’s article went to print). SCOTUS said, “The State’s enforcement of the use tax against Quill places an unconstitutional burden on interstate commerce.”2 But, SCOTUS also said, “The underlying issue here is one that Congress may be better qualified to resolve, and one that it has the ultimate power to resolve,”3 thereby inviting the legislative branch to join the fray.

It is easy to take for granted the way the profession is today — and assume it’s always been that way. Ours is an evolving and dynamic profession. This column looks at the way we were a quarter-century ago.

It sounds like a relatively recent

controversy: Can states assess sales taxes on a company that sells products to the state’s residents even though the company has no physical presence in the state? After all, 25 years ago, Al Gore was just starting to invent the Internet.

In the June 1992 issue of Disclosures, Paula Anthony’s award-winning1 article, “Sales and use tax issues on a national and local level,” appeared.

The then-controversy related primarily to mail order sales. States were discovering that they were losing billions in tax revenues due to mail orders. Paula’s article began, “Departments of revenue all over the country are anxiously awaiting a United States Supreme Court ruling on the Quill v. North Dakota case.”

North Dakota had recently amended its sales tax laws to mandate collection of sales taxes from mail order companies doing business with state residents or companies. Twenty-seven other states got on board that revenue-collection train as well. Quill (an office supply company) sued North Dakota and the North Dakota Supreme Court ruled in the

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Currently, most states have enacted “use taxes.” Residents of a state are obligated to pay a “use” tax if the seller does not collect and pay a “sales” tax; and the rates are usually the same for both the “sales” and the “use” tax. That would satisfy a state’s appetite for collecting taxes, except for the fact that it’s easier to collect taxes from the smaller number of sellers than from individual buyers.

So, where do we stand on this? The overarching principle is still related to “physical presence.” If a seller has a “physical presence” (store, office, warehouse, plant or sales representative) in a state, then the seller must pay the state its sales tax. But, it’s not that simple. The word “nexus” appears 54 times in SCOTUS’s Quill decision. States adroitly determined that “physical presence” and “nexus” are not necessarily the same thing. “[M]any states, including Virginia, have used the term “nexus” rather than “physical presence” in their sales tax laws, and, in the process, have sometimes defined nexus in ways that some people may think goes beyond physical presence.”4 According to the Virginia Department of Taxation FAQ page [VADOTFAQ], “An out-of-state seller must register with the Department and collect the tax on sales to Virginia customers if the seller has sufficient nexus, or contact, with Virginia. If the seller does not have nexus with Virginia, there is no requirement to collect the tax or register for a use tax account.

For further information on nexus criteria, see Virginia Code Section 58.1-612.” Virginia Code Section 58.1-612 contains 2,435 words.

Problematically, however, “nexus’ is not one of them. The 2,435 words attempt to explain when a “dealer” must register to collect and pay taxes.

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PROFESSION’S past Many states (Maryland and District of Columbia, but not yet Virginia) have embraced a concept called “click-throughnexus.” Here’s how it works: Business A has no physical presence in a state, but an unrelated Business B in the state has a website. Business B’s website has a link to Business A or one of its products. Bingo — via click-throughnexus, Business A must remit taxes to the state.

Several members of U.S. Congress recently accepted SCOTUS’s 1992 invitation to bring closure (if not clarity) to this issue via federal legislation. The “Marketplace Fairness Act” is percolating in the House and was passed by the U.S. Senate in May 2013. In a nutshell, the Act would “require all sellers not qualifying for the small-seller exception (applicable to remote sellers with annual gross receipts in total U.S. remote sales not exceeding

$1 million in the preceding calendar year) to collect and remit sales and use taxes for remote sales …”5 The Internet Tax Freedom Act was enacted in 1998 but expires on Nov. 1, 2014. It prevents state and local governments from taxing electronic commerce. (Consider paying the state, say, $.10 per email or per website visited and the federal government $.15 per email or per web site visited.) If nothing happens before the expiration date, the tax floodgates will open wide. Virginia Rep. Bob Goodlatte recently sponsored the “Permanent Internet Tax Freedom Act.” His 98-word bill would “permanently extend the Internet Tax Freedom Act.” It passed the House on July 15, 2014, by voice vote. Stay tuned.

Paula likely never imagined that 22 years after her article was published, the issue remains incompletely resolved and, with the explosion of Internet commerce, more important and contentious than ever. n

Paula Anthony concluded her excellent 1992 article by summarizing:

Author’s note: Special thanks to Art Auerbach, CPA, for his valuable input to and experienced insight on this article.

Game Change.

1. Paula Anthony was a student at Old Dominion University in 1992 and her article won the 1991–1992 Disclosures Student Manuscript Contest.

2. See http://caselaw.lp.findlaw.com/scripts/getcase.pl?court=US&vol=504&invol=298 3. Ibid.

4. See www.nolo.com/legal-encyclopedia/virginia-internet-sales-tax.html 5. See https://beta.congress.gov/bill/113th-congress/senate-bill/743

We just broke the mold in the benefits industry. We’re offering the single most critical benefit for you and your clients — advice. Sound, actionable advice. This changes everything.

Game On?

DAVE COTTON, CPA, is partner at Cotton and Company, LLP, in Alexandria. He is a former VSCPA Board of Directors member and currently sits on the VSCPA Editorial Task Force. He joined the VSCPA in 1981. dcotton@cottoncpa.com connect.vscpa.com/DavidCotton

Endorsed by the VSPCA

B r i a n M a r k s , P r i n c i Pa l 877.998.7272 e M a i l : bmarks@digitalbenefitadvisors.com v i s i t : www.digitalbenefitadvisors.com/vspca

call:

DISCLOSURES

“When the United States Supreme Court rules on the Quill v. North Dakota case, either the states will realize a windfall in sales taxes collected by all mail order companies and use taxes will no longer be such an issue or states will be forced to continue their efforts at collecting taxes, knowing that a lot of revenue will still be slipping through the cracks. Either way, auditors will have to evaluate controls on compliance with sales and use tax laws when performing an audit.”

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TAXATION

Don’t be in the dark: Federal tax changes for the 2014 filing season

BY CHIP KNIGHTON

of $200,000 or 50 percent of the gross income derived by the material advisor (75 percent if the failure is international). >> For failure to disclose more than one reportable or listed transaction, a separate penalty will be imposed for each transaction. >> When calculating the penalty in the case of a listed transaction, the gross income derived from the transaction only includes fees earned in connection with the transaction for which the advisor was a material advisor.

LONGEVITY ANNUITY CONTRACTS

Tax season for 2014 returns will be here before you know it, and with it comes the necessity of putting new U.S. Internal Revenue Service (IRS) regulations into practice.

The VSCPA wants to make your tax season as painless as possible, so here’s an overview of some of the changes the IRS put in place in 2014.

This list is not all-inclusive, so be sure to go straight to the source and visit www.irs.gov/irb to be as current as possible.

MATERIAL ADVISORS AND LISTED TRANSACTIONS The IRS issued final regulations in July dealing with penalties for material advisors who fail to file true, complete or timely disclosure returns with respect to reportable or listed transactions under Sec. 6707 of the U.S. Tax Code. The new regulations make the following changes: >> The applicable penalty for a transaction qualifying as both reportable and listed is limited to a single penalty of the greater

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Another set of regulations covers longevity annuities, under which individuals pay a premium with part of their retirement account assets for an annuity that will start later in retirement and is guaranteed to run until death. Such annuities did not go well with minimum distribution rules requiring distributions to begin at age 70½ or at retirement, but the new regulations are designed to help promote the use of qualified longevity annuity contracts (QLAC). Annuities can qualify as QLACs under the following conditions: >> The required premium must not exceed $125,000 or 25 percent of the individual’s account balance, whichever is lower. >> The annuity contract must provide that payouts begin no later than the first day of the month following the purchaser’s 85th birthday. >> The contract cannot be a variable, indexed or similar contract and may not provide for any commutation benefit, cash surrender right or any such feature unless specifically authorized by the IRS. >> The contract may include a return-of-premium feature and a surviving spouse annuity, or may provide for a reduced annuity to a non-spouse beneficiary. >> The contract must state that it is intended to be a QLAC. The regulations provide procedures for modifying existing annuity contracts.

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TAXATION

PREMIUM TAX CREDITS FOR DOMESTIC VIOLENCE SURVIVORS Final regulations released in July include rules that allow victims of domestic violence to claim the Premium Tax Credit for health insurance.

U.S. Treasury Department regulations released in 2012 require married couples to file joint income tax returns to obtain premium tax credits, which are available for individuals earning less than $44,000 and families of four earning less than $90,100. Victims of domestic abuse often file taxes separately from their spouse in order to protect themselves from future abuse.

To combat the disconnect, the IRS and the Treasury released guidance providing that “a married individual who is living apart from his or her spouse, and who is unable to file a joint return as a result of domestic abuse, will be permitted to claim a premium tax credit for 2014 while filing a tax return with a filing status of married filing separately.”

The regulations allow for survivors of domestic violence and spousal abandonment to claim the credits in future open enrollment periods.

RESEARCH EXPENDITURES Other regulations amend the IRS’s definition of research and experimental expenditures, including a clarification that the ultimate success, failure, sale or other use of research is not relevant to a determination of eligibility for research-related tax credits under Sec. 174 of the Tax Code. The regulations also state that: >> The Depreciable Property Rule in Secs. 1.174-2(b)(1) and 1.174-2(b)(4) is an application of the general definition of research or experimental expenditures and should not be applied to exclude otherwise eligible expenditures. >> The term “pilot model” is defined as any representation or model of a product produced to evaluate or resolve uncertainty concerning the product during its development or improvement, including a fully functional representation or model of a product or a component of a product.

regulations retain the rule in the proposed regulations that TTINs may not be used on a return filed with the IRS. TTINs are also not permitted to be used: >> Where prohibited by statute, regulation or other guidance published in the U.S. Internal Revenue Bulletin (IRB), form or instructions >> Where a statute, regulation or other guidance published in the IRB, form or instructions specifically requires the use of a Social Security number, Individual Taxpayer Identification Number, Adoption Taxpayer Identification Number or Employer Identification Number Also, a person or entity may not truncate its own taxpayer identification number on any tax form, statement or other document furnished to another person.

DEDUCTING COSTS OF ESTATES AND TRUSTS Final regulations published in May offer guidance on which costs incurred by estates and trusts are subject to a 2 percent floor for miscellaneous itemized deductions.

The regulations in question affect estates and trusts other than grantor trusts with regard to Sec. 67(a) of the Tax Code, which provides that, for an individual taxpayer, miscellaneous itemized deductions are allowed only if the aggregate of those deductions exceeds 2 percent of adjusted gross income (AGI). Sec. 67 also excludes certain itemized deductions from the definition of “miscellaneous itemized deductions” and provides that the AGI of an estate or trust should be calculated the same way it would be for an individual.

The regulations also state that deductions for costs paid or incurred in connection with the administration of the estate or trust that would not have been incurred if the property were not held in the estate or trust should be treated as allowable in calculating AGI. Those deductions are not subject to the 2 percent floor for miscellaneous itemized deductions. n

>> The new “shrinking-back rule” can be used to address situations in which the requirements are met with respect to a component part of a larger product, but not to the overall product itself.

CHIP KNIGHTON is communications specialist at the VSCPA, as well as contributing editor at Disclosures magazine. cknighton@vscpa.com connect.vscpa.com/ChipKnighton

TRUNCATED TAXPAYER IDENTIFICATION NUMBERS

@ChipKnighton

The IRS issued final regulations on truncated taxpayer identification numbers (TTIN), used as a safeguard against identity theft. The final

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Get in the game Providing business management services to athletes and other high-net worth individuals

BY WINDY CAMPBELL

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PRACTICE management

At the height of his NFL career, a professional football player was rolling in a taxable income of several million dollars per year. He had everything he wanted: a nice car, a nice house for his growing family and several business entities, which had been set up to help preserve and grow his wealth long after his playing years were done. Despite this, his financial position wasn’t ideal.

He lacked a professional budget and he didn’t monitor his cash flow. He woke up one day realizing he was overspending. His circle of advisors lacked the CPA experience necessary to professionally run his company and entities to be both tax-efficient and legally compliant.

He had to do something.

At a teammate’s recommendation, the athlete turned to Steven M. Piascik, CPA, MT, founder and president of PIASCIK, a Richmond-headquartered CPA firm that for over a decade has provided complex tax minimization strategies to more than 100 professional athletes, as well as CFO services to international companies in 49 countries spanning six continents.

“This client was swimming in money, but he knew nothing about budgeting,” said Piascik, who was one of the first CPAs to earn Registered Financial Advisor status from the NFL Players Association (NFLPA). “We immediately put the athlete on a monthly budget, which we monitored closely, and met with him monthly to help educate him on financial issues while we documented all his tax deductions.”

Through the CPA firm’s multifamily office subsidiary, PIASCIK Business Management, LLC, Steve Piascik leveraged his firm’s CPA niche services to manage not only the athlete’s personal accounts, but also his active corporation and two nonprofit entities. In just six months, the PIASCIK team successfully

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deployed several financial and tax-efficient strategies and ultimately saved the athlete more than $500,000 in taxes his first year alone.

of $5 billion. Their net worth has more than doubled in this decade.

PIASCIK also implemented an asset protection plan and updated the athlete’s will and estate plan to maximize the most current opportunities. In addition, PIASCIK established a monthly bill payment process for the athlete’s personal, business and nonprofit entities. Through the firm’s entertainment industry connections, PIASCIK introduced the athlete to a Los Angeles-based movie producer and large marketing companies to help assist the athlete with maximizing his “off-field” income potential.

“As business managers, we are dedicated to ensuring our high-profile or high-net worth clients are financially taken care of, from a young, rising-star athlete to a newly widowed spouse with a family legacy of children and grandchildren,” said Piascik. “CPAs must be prepared to work with the client, their family members and others in their extended family, including bankers and lawyers. It’s a team effort.”

According to a 2012 report by research firm Cerulli Associates, family assets under management exceeded $750 billion in 2011, a 70 percent increase from 2007.

AMERICAN WEALTH ON THE RISE AGAIN Six years after many fortunes tumbled in the financial crisis, American wealth once again is on the rebound. Forbes estimates that the 400 wealthiest Americans are now worth just more than $2 trillion, with an average net worth

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With financial markets improving, economic volatility is still threatening global markets.

High net-worth individuals are placing an increasing priority on protecting their assets and preserving their wealth, both for their own benefits as well as their family legacies.

Prominent families and entrepreneurs increasingly are turning over their wealth management to multi-family office business managers, for asset protection as well as family wealth preservation. These firms are experienced in the full gamut of managing the lives and finances of high net-worth clients, including entertainers, athletes, billionaire investors and others.

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High-net worth clients and their families, who often are scattered across continents with multiple real-estate holdings and business entities, are demanding a higher level of service from their tax advisors that extends far beyond tax return preparation. In addition to expecting their CPA to prepare tax returns and estimated tax calculations, these very busy individuals are requiring CPAs to produce monthly financial statements and budget forecasts, pay their monthly bills, ensure they are compliant with all foreign and domestic tax codes, plan their legacies for children u

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and grandchildren, provide financial planning services and assess investments.

After almost a decade of PIASCIK performing these niche services, the firm officially launched PIASCIK Business Management, LLC, earlier this year in Beverly Hills, Calif., a multi-family office subsidiary serving ultrahigh-net worth clients and families. Through its international tax practice, PIASCIK also is leveraging its outsourced CFO services to international firms based on the West Coast.

Unlike other family office or business management practices, which outsource their clients’ tax needs, a CPA-based business management specialty provides independent, in-house tax and financial services at a more costefficient rate.

“PIASCIK Business Management was established from our firm’s success in implementing tax minimization strategies and counsel to professional athletes, who represent some of America’s wealthiest individuals,” said Piascik, who founded PIASCIK in 2001 after working for a Big Four accounting firm. “As the depth of our athlete tax services has grown, we created PIASCIK Business Management to serve as a personal CFO to these business-savvy athletes, to take care of the financial needs of their families, as well as their businesses and entities.”

SOPHISTICATED AND CUSTOMIZED SOLUTIONS To differentiate themselves and offer more value to high net-worth clients, CPA firms with experience in providing complex tax management to high net-worth clients are integrating the multi-family office model into their in-house services. By serving as a family’s or client’s own personal CFO, CPA firms can offer a full balance sheet of tax and financial management solutions. Some families or clients may require many services; others may only require a few functions, depending on their budget, needs and goals.

“I often say, ‘When you’ve seen one family office, you’ve seen one family office.’

Every family is unique, and they often are complicated and many times dysfunctional,” says Greg Kushner, CPA, founder and president of LIDO Consulting, Inc., a Southern California-based firm providing

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consulting services for families with substantial wealth. “In integrating family office services into an accounting practice, CPAs have a unique opportunity to not only provide sophisticated tax solutions to prominent clients, but also offer customized assistance tailored to fit the specialized financial needs of these high net-worth families.”

CPA firms that integrate business management as a niche specialty practice have the experienced caliber of staff to not only manage complex tax situations, but also provide a complete outsourced solution to managing clients’ finances and investments.

This includes asset protection, budgeting, insurance analysis, charitable giving, familyowned businesses, wealth transfer and tax services. These offices set themselves apart from traditional wealth management firms.

PIASCIK has leveraged its business management and CFO services to reach a broad range of clients throughout the world, including international firms and professional athletes. When it comes to athletes, Piascik works alongside these busy, sports-focused individuals to perform monthly accounting compilations, develop tax minimization strategies and create a tailored financial plan to provide for the athlete and their family's future. The complex tax consulting requires PIASCIK’s team of licensed CPAs to be on top of their game with multi-state income taxation strategies, as athletes must file multiple returns because of their travel.

As PIASCIK has successfully built a niche professional athlete practice, the firm also has firmly solidified its expertise in international tax strategies and in family trusts and estates.

These niche service areas are enabling PIASCIK Business Management to reach ultra-high net worth families and individuals, not just athletes, but also those with offshore assets and international business interests, multiple real estate holdings scattered around the world and beneficiaries living in these residences and working for their family entities.

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>> CFO role for clients’ privately held business ventures >> In-house tax compliance and financial services: • Concierge services of all types including (but not limited to) travel arrangements, moving arrangements, event tickets, home construction management and house sitting, errands and other requested by clients >> Independent reviews of monthly investment results, with an objective review of investment documentation STEVEN PIASCIK, CPA

GREG KUSHNER, CPA

Unfortunately, many families are affected by divorce, and all families eventually experience death of a patriarch or matriarch.

and confidentiality is extremely important with our prominent clients,” said Piascik. “As tax experts, we are always up-to-date on the latest tax laws, changes and codes. Unlike other family office or business management practices, which outsource their clients’ tax needs, a CPA-based business management specialty provides independent, in-house tax and financial services, at a more cost-efficient rate. When trusted and bound by ethics and family privacy, CPAs can serve as trustees on any trusts.”

“Professional athletes, along with wealthy divorcees and widowers, are among the best clients to teach and assist on how to best manage their own money,” said Piascik.

“Athletes are young and in their early twenties; divorcees and widowers can be any age. But often overnight, they all are faced with the challenges of high income and high taxes, and they aren’t prepared for managing and budgeting their newfound wealth. We help them find the best solutions to protecting their assets.”

ADVANTAGES OF CPA-BASED BUSINESS MANAGEMENT

>> International tax (in house) >> All estate and trust returns >> Family limited partnership returns >> Gift tax returns

PIASCIK Business Management, LLC, charges these clients a flat fee for its full spectrum of services, which are completely independent and customized for each client, based on the client or family’s needs and budget. Services include:

From his experience in serving the complicated needs of professional athletes and their families, Piascik understands that CPAs hold numerous advantages to serving high net-worth families in a business management capacity.

“A CPA firm that adheres to the industry’s highest legal and ethical standards carries trust and commitment to a family’s privacy,

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>> Financial planning assessment: • Current cash flow and income needs • Complete and comprehensive personal financial plan • Education planning (for grandchildren) • Insurance analysis and review

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>> Charitable remainder trusts >> Legacy planning “PIASCIK Business Management has enabled us to deliver high-value services by crossselling other capabilities of the firm,” said Piascik. “This has kept our clients happy and engaged, all the while strengthening client relationships and growing our business.”

>> Monthly CPA financial statements, including forecasts, budgets, cash flows and all other financial statements needed

LEARN MORE

>> Monthly bill payment of client’s personal and company invoices • Cash flow management and budget implementation

Before any CPA rushes into the business management or family office industry, Kushner recommends that they first educate themselves. Here are a few places to start: u

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PRACTICE management OBTAIN A CERTIFICATE Pepperdine University, in partnership with Lido Consulting, Inc., offers a Certificate in Financial Management for the Family Office.

This two and a half-day course gives attendees the opportunity to learn best practices in corporate governance and financial management, evaluation skills necessary to oversee and manage the financial and budgetary aspects of their organization, and the tools necessary to make informed and suitable investment decisions.

ATTEND A FAMILY OFFICE SEMINAR, WORKSHOP OR SYMPOSIUM Lido Consulting hosts a Family Office Conference annually each March and September. For more information, visit www. lidoconsulting.com/investmentsymposium.

The Family Office Exchange (FOC) offers forums for the latest trends and best practices, workshops on specific related topics, webinars providing briefings from experts on a variety of topics and regional meetings where executives can informally gather to share new insights and practical solutions. For more information, visit https://www.familyoffice. com/learning-events.

“CPAs are in a great position to thrive in the family office industry because they already understand the tax codes and regulations impacting family wealth,” said Kushner.

“Business managers can serve as the trusted front guard against financial ruin, helping to mitigate risks and invest client assets in a smart manner. In summary, it takes comprehensive knowledge, years of experience and a deep understanding and knowledge of their clients’ life situations.” n

WINDY CAMPBELL is principal of Campbell Communications in Richmond, an independent public relations practice serving private companies and nonprofits. Her areas of expertise include communications strategy, media relations, writing and product publicity. windycampbell@mindspring.com http://windycampbellpr. wordpress.com (804) 314-0205

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Time for Takeoff: 2014 Tax Season Begins Changes and updates to the 2014 tax filing season in Virginia.

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For a full report on all the changes (this list is not all-inclusive), read the “2014 Legislative Summary” from the Virginia Department of Taxation, available as a PDF at www.tax.virginia.gov. All changes went into effect July 1, 2014, unless otherwise stated.

TAX CONFORMITY The 2014 General Assembly did not advance Virginia’s date of conformity to the U.S. Internal Revenue Code (IRC). Therefore, Virginia’s date of conformity remains Jan. 2, 2013. However, Congress did not enact any federal tax legislation that would have an impact on Virginia returns after Jan. 2, 2013.

Taxpayers may still use their federal adjusted gross income (or federal taxable income, for corporations) as the starting point for calculating their Virginia taxable income for Taxable Year 2013, except as provided in Tax Bulletin 14-1 and Tax Bulletin 14-7. Tax Bulletin 14-7 provides guidance on Virginia income tax treatment of same-sex married couples.

Virginia still disallows any bonus depreciation allowed for certain assets under federal income taxation and any five-year carry-back of federal net operating losses (NOL). In addition, Virginia will continue to deconform from certain applicable high-yield discount obligations and cancellation of debt income provisions.

ADVANCEMENT OF VIRGINIA’S FIXED DATE CONFORMITY TO THE FEDERAL ENHANCED EARNED INCOME TAX CREDIT (EITC) Previously, Congress temporarily increased the federal EITC amount for individuals with

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three or more qualifying children from 40 percent to 45 percent and reduced the EITC marriage penalty by increasing the phaseout amount for married couples. During the 2010, 2011, 2012 and 2013 sessions, the General Assembly elected to advance the date of conformity to these provisions one year at a time, to taxable years 2009, 2010, 2011 and 2012.

The 2014 General Assembly extended Virginia’s conformity to the federal enhanced EITC to taxable years ending before Jan. 1, 2018. That is, through taxable year 2017, when the federal enhanced provisions are currently set to expire. See Tax Bulletin 14-1.

FIRST-TIME HOMEBUYER SAVINGS ACCOUNTS For tax years beginning on and after Jan. 1, 2014, an individual may designate a bank account as a tax-exempt first-time home buyer savings account. An individual may then use distributions from that account for the purpose of paying or reimbursing the down payment and allowable closing costs for the purchase of a single-family residence in the Commonwealth by a qualified beneficiary.

All interest or other earned income attributable to such account may be excluded from the Virginia taxable income of the account holder. An account holder may claim

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a subtraction for any income that is taxed as 1) a capital gain for federal income tax purposes attributable to such person’s first-time homebuyer savings account and 2) interest income or other income for federal income tax purposes attributable to such person’s firsttime homebuyer savings account.

There are recapture requirements in the event that funds withdrawn from an account are used for any purpose other than the payment of eligible costs, and a required addition to an account holder’s federal adjusted gross income (AGI) for any loss related to a firsttime homebuyer savings account that was deducted as a capital loss for federal income tax purposes by an account holder.

The amount of principal for which an account holder may claim first-time homebuyer savings account status is limited to $50,000 per account. Only cash and marketable securities may be contributed to an account.

The amount of principal and interest or other income on the principal that may be retained within an account is limited to $150,000.

TAX CONTRIBUTIONS FOR CHESAPEAKE BAY RESTORATION In addition to the voluntary contributions taxpayers are already permitted to make from Virginia income tax refunds, they may now contribute their refunds as donations to the Chesapeake Bay Restoration Fund.

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INDIVIDUAL ESTIMATED PAYMENTS Taxpayers are now permitted to file declarations of estimated tax with the Virginia Department of Taxation instead of local tax officials. This item also requires local tax officials with whom estimated income tax returns have been filed and payments have been made to transmit such returns electronically.

This is effective for taxable years beginning on or after Jan. 1, 2015.

ACCELERATED DUE DATE FOR EMPLOYER WITHHOLDING Beginning with returns for calendar year 2014, Virginia employers will be required to file the annual employer withholding return and copies of the written statements furnished to employees with the Department of Taxation by Jan. 31 of each year. If the tax commissioner finds that this requirement creates an unreasonable burden on the taxpayer, waivers will be granted. All requests for waivers must be submitted to the commissioner in writing.

This is a change from the previous requirement to file these forms by Feb. 28.

The IRS requirement for federal returns has not changed, though the Government Accountability Office has urged the IRS to move up its W-2 filing deadline to Jan. 31.

BUSINESS, PROFESSIONAL, AND OCCUPATIONAL LICENSE TAX — APPEALS OF CLASSIFICATION Business taxpayers are now allowed to appeal to the locality and the Department of Taxation the Business, Professional and Occupational License tax (BPOL), a tax classification or subclassification applicable to a business, regardless of whether the appeal is in conjunction with an appealable event such as an assessment, examination, audit

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or any other action taken by the locality.

Additionally, these taxpayers are allowed to request written rulings from the locality and TAX regarding the classification or subclassification applicable to a business.

Previously, in order to appeal BPOL tax issues, taxpayers were required to file an Application for Review within one year of the last day of the tax year for which such assessment was made or within one year from the date of the appealable event, whichever was later. Upon the timely filing of an Application for Review, the local assessing officer made a final written determination on the taxpayer’s application.

The taxpayer then had 90 days from the date of the local assessing officer’s final written determination to appeal that determination to TAX.

REAL PROPERTY TAX EXEMPTION FOR SPOUSES OF MEMBERS OF THE ARMED FORCES OF THE UNITED STATES KILLED IN ACTION There will be a referendum on the Nov. 4, 2014, statewide ballot to approve or reject an amendment to the Constitution of Virginia to allow the General Assembly to exempt from taxation the real property of the surviving spouse of any member of the armed forces of the United States killed in action, where the surviving spouse occupies the real property as his or her principal place of residence and has not remarried.

EXEMPTION FOR RELIGIOUS BODIES FROM REAL PROPERTY AND TANGIBLE PERSONAL PROPERTY TAX

The 2014 General Assembly did not advance Virginia’s date of conformity to the U.S. Internal Revenue Code. Therefore, Virginia’s date of conformity remains Jan. 2, 2013.

The definition of real property and personal property of churches and religious bodies that qualifies for exemption was changed to include: 1) property used primarily for outdoor worship activities; 2) property used for ancillary and accessory purposes as allowed under the local zoning ordinance, u

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the dominant purpose of which is to support or augment the principal religious worship use; and 3) property used as required by federal, state or local law.

Under prior law, buildings with land actually occupied and personal property owned by churches or religious bodies are exempt from local taxes when exclusively occupied or used either for religious worship or for the residence of the minister of the church or religious body. Additional adjacent land reasonably necessary for the convenient use of any such building was also exempt from state and local tax.

SEPARATE CLASSIFICATION FOR NEW BUSINESS PROPERTY A separate classification for the tangible personal property of a business for its first two taxable years was created. A business must meet the requirements of a “qualifying business” for purposes of the local business incentive program, even if the locality at issue does not currently provide such a program.

A “qualifying business” is one that locates for the first time in the locality adopting a business license incentive program ordinance, excluding businesses that first locate in the locality as a result of a merger, acquisition, similar business combination, name change, or a change in business form.

Localities are authorized to impose the tax on this tangible personal property at a lower rate than that applicable to the general class of tangible personal property.

Under previous law, much of the tangible personal property of a business falls under the general class of tangible personal property.

Localities were required to tax this property at the same rate as imposed on all other tangible personal property in the general class.

Practitioners should check with the appropriate localities to see if the appropriate ordinances have been enacted.

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Tax credit news RESEARCH AND DEVELOPMENT EXPENSES TAX CREDIT During the 2014 session, the General Assembly increased the annual cap for the Research and Development Expenses Tax Credit from $5 million to $6 million. The credit was also to 15 percent of the first $234,000 in Virginia qualified research and development expenses paid or incurred by the taxpayer, or 20 percent of the first $234,000 in such expenses if the Virginia qualified research was conducted in conjunction with a Virginia public or private college or university, to the extent the expenses exceed the Virginia base amount for the taxpayer.

This is an increase from the prior credit amounts of 15 percent for the first $167,000 of expenses, or 20 percent of the first $175,000 of expenses for research conducted in conjunction with a Virginia college or university.

For those with clients who wish to avail themselves of this credit, it is recommended that practitioners review the statute in detail to ensure compliance and to take advantage of this credit.

This is effective for taxable years beginning on and after Jan. 1, 2014, except that the provisions increasing the annual credit cap would be effective for fiscal years beginning on or after July 1, 2014.

LOCAL MEALS TAX AND FOOD AND BEVERAGE TAX The first $100,000 in gross receipts per calendar year of meals sold by nonprofit entities at fundraising sales are now exempt from county food and beverage and city meals taxes, beginning with the fourth such sale in a calendar year, and excluding gross receipts from the first three sales. The gross

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proceeds from such sales must be used by the organization exclusively for nonprofit, educational, charitable, benevolent or religious purposes in order for the exemption to apply.

Under prior law, volunteer fire departments and rescue squads, nonprofit religious bodies and educational, charitable, fraternal or benevolent organizations could have made sales of meals as a fundraising activity exempt of the local food and beverages and meals taxes, provided such sales occurred on an occasional basis, not exceeding three times per calendar year, and provided the proceeds of such sales were used by the organization exclusively for nonprofit educational, charitable, benevolent or religious purposes.

OTHER TAX CREDIT CHANGES The 2014 General Assembly enacted legislation affecting other Virginia tax credits.

Practitioners with clients who may be affected by these changes are encouraged to review the 2014 Legislative Summary to ensure that they are aware of these credits and the opportunities that they offer. The following credits were affected by 2014 legislation: >> Neighborhood Assistance Act Tax Credit >> Tax Credit for Donations to Scholarship Foundations >> Virginia Port Tax Credits >> Motion Picture Production Tax Credit n

Editor’s note: Special thanks to Warren D. Chapman, CPA, for his assistance in developing the tax toolkit.

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Prepare your flight plan with these tax season staples resources >> Help from your friends: Consult experienced colleagues through the Tax Community in Connect, at connect.vscpa.com/home.

cpe NOV. 10, RICHMOND Complete Strategies for Maximizing Contributions, Rollovers, Distributions & Estate Planning of IRAs, SIMPLEs, SEPs & Roths (3-621) NOV. 12, RICHMOND OR ONLINE IRS Liaison Day (4-182) NOV. 17, FAIRFAX A Practical Guide to Trusts (3-725)

>> Legislative updates: Check out the Session Watch page, www.vscpa.com/ SessionWatch, for updates on legislation and regulation that could affect your tax season, such as Virginia state tax conformity.

NOV. 18, FAIRFAX The Best Income Tax, Estate Tax & Financial Planning Ideas of 2014 (3-727) DEC. 5, FAIRFAX Federal, Estate & Gift Tax Returns — Forms 706 & 709 Workshop (3-745)

>> Same-Sex Marriage Resource Center: In June 2013, the U.S. Supreme Court overturned a key portion of the Defense of Marriage Act. Use these resources to help you educate your clients on their rights and how best to proceed.

DEC. 18, ONLINE VSCPA Tax Series Webinar With Art Auerbach

NOV. 17, FAIRFAX Estate Planning for 2014 & Beyond (3-726)

>> Tax Toolkit: From the American Institute of CPAs, find resources and templates for communicating with clients and marketing your services.

DEC. 1–3, RICHMOND OR ONLINE: #VSCPATAXCON14 FEATURING DON FARMER

DEC. 16, ONLINE: THE DIGITAL REWIND: CONTENT. CREDIT. CONVENIENCE.

Visit www.vscpa.com/TaxSeason to access these resources.

How can you possibly be ready for tax season with all the changes to forms, legislation and regulations? This looks like a job for … Don Farmer and Walter Nunnallee! #VSCPATaxCon14 is here to save the day through three days of entertaining and informative tax CPE. Join Don and Walter in person at the Richmond Marriott or participate from the location of your choice via live online webcast.

We know you’re busy, so we’ve handpicked the most informative and popular sessions from 2014 to give you a day’s worth of CPE at your convenience.

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Visit www.vscpa.com/CPE or call (800) 341-8189 for more information or to register for these events.

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Veteran CPAs: Service to Their Country and Profession

BY KEVIN MATTHEWS, CPA, PHR

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What is it to be a veteran and a CPA? What makes military service so different than that from any other job? Is it simply someone who was in the uniformed services but no longer serves? Is the status of a veteran to an ex-military servicemember the same as that of an accountant with an expired CPA license?

On this Veterans Day, some will spend the 11th day of the 11th month, on the 11th hour1, working as they always have; some will have the day off from work in the office. There are many who will attend a Veterans Day parade.

Some may watch a movie or documentary about the Battle of the Bulge, the Battle at Khe Sanh or the Battle of the Argonne Forest. Still others will visit grave sites for their regular pilgrimages to visit a fallen loved one.

In the military, some 20-year-olds have as much responsibility as men and women twice their age. So what comes next? For me and the other veterans I interviewed, the answer was a career in accounting. How have veterans made the transition from military service to the public accounting industry?

FROM THE MILITARY TO THE CPA PROFESSION Some people may ask, “How does military service relate to the accounting industry?”

CPAs who served have answers.

VSCPA member Shawn Middleton, CPA, an audit supervisor at PBMares, is a U.S. Air Force veteran who served as a cryptologic linguist. Some would call this position a code breaker, but it involves much more than simple code breaking. She said being “a part of a team” and “being dependable,” where “the

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whole is greater than the sum of all its parts,” was really what contributed to her current career success. For her, going from cryptology to accounting is not too far of a stretch. “I was looking for an avenue that was concrete — where more technical, hard skills were needed,” she said.

VSCPA member Michelle Okrasinski, a staff accountant at PBMares, was introduced to accounting during her MBA program, while also serving as a naval flight officer in F-14s and F-18s. Naval flight officers are often referred to as “back seaters” because they do not pilot the plane, but are responsible for the tactical mission of the aircraft. She chose accounting, she said, because “[She] had always been good with math.” She also cites her work ethic as a large influence of her success in accounting.

Finally, Eric Schweizer, CPA, a senior accountant at PBMares, served in the U.S. Navy as a sonar technician on surface ships.

Schweizer said his experience in the Navy made him more detail-oriented and really matured him. Many of us were younger and less serious, but time in the service allowed us to appreciate the bigger things in life.

Schweizer credits his time on shore duty and getting his education for showing him that becoming a CPA was a good option.

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My personal experience is a little different from most who transition from the service to accounting. After 9/11, I joined the Navy after earning my master’s degree in accounting. I felt an obligation to do my part. Accounting really influenced my career in the Navy; when I earned my naval flight officer’s wings and went to serve in my first squadron, I was given jobs in which accounting knowledge was key to success. I started to focus on tax because I was asked to volunteer at a Volunteer Income Tax Assistance (VITA) office.

HOW MILITARY EXPERIENCE CAN PREPARE CPAS As we all know, becoming a CPA is not an easy feat. The required 150 credits usually means a double bachelor’s degree or a master’s degree. Today, that is easier for a veteran thanks in part to the post-9/11 G.I. Bill, which makes it easier to go to college and obtain four years of education, and many service members also are encouraged to take college courses while in the military. Middleton and Schweizer took classes while in the service, and Okrasinski was in a master’s of business administration program.

My military experience added to my ability to prepare for the CPA Exam. I took it once in 2003 (the last paper exam) and did not pass. I took it again as my military u

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The same public that expects the best from its uniformed servicemembers also expects the best from its Certified Public Accountants. The CPA profession is another form of public service. service was ending, and I completed the entire exam on the first try. (Truly, the second try, but the paper exam was so different from the computer exam, perhaps it should not count.)

When many of us think of the career switch, very few think of the accounting industry as an option. Perhaps it is the many years of procedures that wear us down. Others are mistaken into thinking this is a numbers-only profession and ignore the many problemsolving skills this industry needs so badly.

When I left the military and told others I wanted to go into tax accounting, many were surprised. However, I was the one who was surprised and continue to be surprised today.

I have constantly used the problem-solving and research skills I learned in the Navy.

Understanding of the hierarchy of importance has come in handy when dealing with tax laws, regulations and court cases. One of my former leaders once said I had the research ability of a tax manager (three levels higher than I was at the time). I attribute that to the preparation the military gave me.

Being a veteran also gives perspective on what being a CPA means. Some accountants I have met will tell me being certified really does not mean anything, or “it’s just a piece of paper.”

I, and many veterans, beg to differ. Veterans have the experience of putting on that extra stripe or rank, where we not only received better pay, but more importantly, extra responsibility.

See page 38 for a profile of Robert Persons, CPA, a veteran VSCPA member.

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It is easy to skip the process of “tying the balance on the statement with the outside source, because it has always been right before.” Sometimes there is pressure by the client to put more on the tax return than should be there. Veterans have learned, some of us by experience, the importance of keeping the standard. Being a CPA is really no different. The same public that expects the best from its uniformed servicemembers also expects the best from its Certified Public Accountants. The CPA profession is another form of public service.

SKILL SETS VETERANS BRING TO THE PROFESSION Veterans take a view of hard work as nothing new and part the trade. In accounting, 5060 hour weeks are often required, and for veterans it is “not a big deal to put in a 50hour week.” Twelve-hour shifts were common when I was on operational duty. Personally, I have always looked at tax season with a bestof-both-worlds view. When a squadron goes on deployment, a comradery develops because of the common mission and experiences we all have. I have personally encountered the same sort of feeling in accounting. The downside of serving on deployment is little or no contact with family for six months. In accounting, tax season only lasts four months and we get to go home every night, albeit with early rises and late nights.

Veterans also bring global experience. Many of us have served in the “sandbox” (the affectionate word we have for the desert kingdoms of the Middle East). While many veterans have combat experience in the desert, there are also many who served in supportive roles. Supply and logistics will destroy an army’s chances of winning faster

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than most weather storms. Some of us have glamorous overseas tours to bring to the firm. Servicemembers have opportunities to relocate and serve in Europe, Asia, Australia and South America. What if you are a small firm and don’t have international clients? Global experience allows for greater diversification of ideas and thought processes, which allows accountants to see things from different perspectives. Some of your clients might be from countries in which we served.

It breaks the ice at a minimum.

Veterans bring general management skills to the accounting field. In the service, leadership is taught from the beginning and expected as early as three to four years out of primary school (in the case of officers, it is expected before completing the first week of primary training). That means that servicemembers can be expected to lead as young as 20-yearsold in some cases. If a veteran has eight years in the service, that includes more than four years of leadership experience. While this is not an article about leadership, leadership is a skill, just like any other, that requires time to develop. Veterans have spent that time and audit teams with veterans at the helm are likely going to do well.

WHAT VETERANS DAY MEANS TO VETERAN CPAS So, since this article is about veterans and Veterans Day, how do veterans feel about the holiday? There are mixed feelings. Some feel we celebrate veterans enough through honoring them with this day. Some wish we did more. Personally, I have mixed feelings because I have family who served as far back as the Revolutionary War. But there is a part of me that does not know what the best way is to honor those who have fallen. Should I

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PROFESSIONAL development volunteer to help veterans more? Should I visit Arlington Cemetery? Perhaps I should toast the men and women who served and sacrificed for me. Every year, I do something different, but I try to reach out to many of my veteran friends and say thanks.

The Vietnam generation served under the toughest of circumstances. It was an unpopular war, but the members of the Vietnam-era did the best they could under conditions no servicemember should have to endure. The Cold War veterans are not often recognized for their efforts during a time when, at any minute of any day, one side could determine the world’s fate. My father served during this time, and his 23 years in the Air Force inspires me to this day. Regardless of where and when they served, all veterans deserve our gratitude and respect.

Schweizer spends some Veterans Days with his family and his father, who is also a Navy veteran. Middleton said it well: “This country is 238 years old, and a lot of blood was shed well before my service. On Veterans Day, I thank those that got us those years, including some of my friends that still serve and pray for many more years of freedom.” Who can ask for more than that? n

KEVIN MATTHEWS, CPA, PHR, is a senior tax accountant in the International Executive Service at KPMG in Tysons Corner. He served eight years in the U.S. Navy as a naval flight officer, with time in the Middle East and Kosovo. He is also a doctoral student at George Washington University’s Executive Leadership Program, where he is focusing on ethics, leadership, organizational culture and compensation development. kmatthew@gwmail.gwu.edu connect.vscpa.com/KevinMatthews

YOU =

1. The reference of the 11th day of the 11th month at the 11th hour is the original reason for the date of Veterans Day. Nov. 11 was Armistice Day, the day Germany surrendered during WWI, which was also known as “the war to end all wars.” All hostilities were required to end at 11 a.m. on that day. Veterans Day was changed in 1954 to include all veterans.

AVERETT’S MASTER + OF ACCOUNTANCY

S U C C E S S

Top four ways Averett University’s Master of Accountancy program will help you succeed: • • • •

You’ll enjoy individual attention from top-notch professors who are CPAs themselves, and who care about your success.

You’ll learn all the skills you’ll need to excel in private accounting, public accounting, or the teaching profession.

We’ll help you prepare for a successful CPA exam.

You can earn your Master of Accountancy in three to four semesters – meaning you can start reaping the benefits of your degree faster.

For more information, please contact Dr. Peggy Wright at directormacc@averett.edu or (434) 791-7118. Or go to www.averett.edu and look under Academics – Graduate Programs MAcc.

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VSCPA financials

Statements of Financial Position & Statements of Activities The following Statements of Financial Position and Statements of Activities reflect the VSCPA’s and VSCPA PAC’s financials for the 2013–2014 fiscal year. The full audited financial statements are available online in the “For Members” section of www.vscpa.com. More information on the VSCPA’s 2013–2014 programs and initiatives is available in the 2013–2014 “State of the VSCPA” report, also available at www.vscpa.com.

APRIL 30,

2014

2013

ASSETS Current Assets Cash and cash equivalents Trade accounts receivable Due from VSCPA Educational Foundation Investments Prepaid expenses

$

1,333,533 44,148 — 1,283,230 190,737 2,851,648

Total current assets Property and Equipment, Net

$

1,320,620 $

1,423,181 56,113 3,000 1,034,528 245,395 2,762,217 1,456,656

4,172,268

$

4,218,873

93,625 206,264 — 504,288 132,241 936,418

$

60,488 204,804 3,000 595,702 129,420 993,414

LIABILITIES AND NET ASSETS Current Liabilities Accounts payable Accrued expenses Pledges payable Deferred revenues Accrued retirement

$

Total current liabilities Net Assets Unrestricted Invested in property and equipment Board designated for facility and technology Board designated for operating expenses Undesignated Temporarily restricted (VSCPA PAC)

Total net assets $

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1,320,620 550,110 1,027,483 206,675 3,104,888 130,962 3,235,850 4,172,268

$

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1,456,656 477,237 1,000,155 155,588 3,089,636 135,823 3,225,459 4,218,873

VSCPA financials YEARS ENDED APRIL 30,

2014

2013

Change in Unrestricted Net Assets Revenue:

Program: Continuing education Seminars Conferences Ethics Online Other CPE Peer review Leaders’ Summit Membership Communications Students and young professionals Net assets released from restriction, VSCPA PAC

$

1,311,337 539,085 507,665 89,900 13,552 194,948 — 2,075,055 50,447 115,765 80,336 4,978,090

Other: Affinity income Investment income Realized gain on investments Unrealized loss on investments Rental income Gain/(loss) on disposal of property and equipment Miscellaneous

Total support and unrestricted revenues Expenses: Program Services: Continuing education Leadership Peer review Membership Communications Students and young professionals Public relations Legislative VSCPA PAC Supporting Services: Administrative and general

Total expenses Change in unrestricted net assets Change in Temporarily Restricted Net Assets Contributions to the VSCPA PAC Net assets released from restriction, VSCPA PAC

Change in temporarily restricted net assets Change in net assets Net Assets — Beginning of Year Net Assets — End of Year DISCLOSURES

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$ •

$

1,332,272 547,575 476,336 112,368 20,658 187,748 1,000 1,995,518 16,239 101,805 52,165 4,843,684

180,034 10,064 — (2,298) 35,427 (3,478) 3,292 5,201,131

165,816 11,085 22,800 (21,283) 42,719 350 1,790 5,066,961

2,168,075 327,957 181,957 696,462 310,095 239,585 161,206 181,289 80,336

2,104,792 296,483 195,779 649,031 260,899 166,897 175,244 161,262 52,165

838,917 5,185,879 15,252

976,270 5,038,822 28,139

75,475 (80,336) (4,861) 10,391 3225,459 3,235,850

60,700 (52,165) 8,535 36,674 3,188,785 3,225,459

$

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VSCPA news

Day of Service highlights successful CPA Week Virginia Gov. Terry McAuliffe declared

Sept. 14–20 as Virginia Certified Public Accountants Week, stating, “CPAs in Virginia continuously draw upon their unique knowledge and experiences to provide sound, reliable financial counsel in order to protect and promote the growth of business, the soundness of government operations, the excellence of higher education and the confidence of investors in the Commonwealth of Virginia and throughout the United States of America.” The VSCPA spent the week celebrating those contributions, culminating in CPA Day of Service on Sept. 19.

The VSCPA and Virginia Business magazine hosted a free Economic Expectations Roundtable on Sept. 17, featuring VSCPA members Charlie Equi, CPA, Greg Lawson, CPA, Ryan Losi, CPA and Colette Wilson, CPA, chair of the VSCPA Board of Directors. You can watch a complete video of the discussion at www.vscpa.com/ EconomicExpectationsRoundtable.

Go to www.vscpa.com/EconomicExpectationsRoundtable to watch video of the discussion.

If you couldn’t participate on Sept. 19, you can still give back with the VSCPA! We’ll have a Toys for Tots donation box at the CPA Center in Richmond until December. If you’re going to visit us or are in the Richmond area, bring a new, unwrapped toy to donate to a child in need.

On Sept. 19, hundreds of CPAs and their colleagues across Virginia took time to volunteer in their local communities for CPA Day of Service. The organizations VSCPA members helped include Hospital Hospitality House of Richmond, Backpacks of Love, Food for Others, Virginia Supportive Housing, the Society for Prevention of Cruelty to Animals (SPCA) in Richmond, Roanoke, Virginia Beach and Warrenton, and many more.

VSCPA members, thanks for all your hard work on behalf of the CPA profession! n

THANK YOU, 100% FIRMS!

>> OPEN VOLUNTEER OPPORTUNITIES

Due to space constraints, the list of VSCPA 100% Member Firms has been omitted from this issue. A 100% Member Firm is simply a Virginia CPA firm or company that has all of its CPAs enrolled as members in the VSCPA. These firms show their commitment to their employees, the profession and the association.

The VSCPA is now accepting volunteers for various opportunities at different times throughout the year, although some opportunities are open year-round. The following volunteer opportunities are currently open (deadline is Dec. 31 unless otherwise noted):

Check www.vscpa.com/100Percent for a complete, up-to-date list. n

• VSCPA Political Action Committee (VSCPA PAC) Board of Trustees (closes Dec. 15) • Young Professionals Advisory Council (closes Dec. 15) • VSCPA Accounting & Auditing Advisory Committee

• VSCPA Board of Directors (closes Dec. 15)

• VSCPA Professional Ethics Committee

• VSCPA Educational Foundation Board of Directors (closes Dec. 15)

• VSCPA Tax Advisory Committee Visit www.vscpa.com/ VolunteerSchedule for more.

• VSCPA Peer Review Committee

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CPA ASSEMBLY DAY IS JAN. 20

Nominate a colleague!

Do you know a Virginia CPA who deserves to be honored for outstanding work or for their civic or charitable activities? Or are you acquainted with one of the best young CPAs in Virginia? Don’t let exceptional work to go unnoticed. Nominate a worthy colleague for a VSCPA Distinguished CPA Award:

TOP 5 MEMBERS UNDER 35 Nominate a young VSCPA member (35 or younger as of April 30, 2015) who has shown excellence in one or more of the following: professional achievement, VSCPA or local VSCPA chapter accomplishment, community contribution or dedication to the CPA profession.

VSCPA President & CEO Stephanie R. Peters, CAE, talks with Del. Betsy Carr (D-Richmond) during the 2014 CPA Assembly Day.

Save the date! CPA Assembly Day, where VSCPA

members visit their elected representatives at the Virginia General Assembly, will take place Tuesday, Jan. 20, 2015. Even the threat of bad weather last year couldn’t stop record numbers of VSCPA members from making their presence felt and discussing CPA issues with their representatives. We’d love to see you among them this year! Visit www. vscpa.com/CPAAssemblyDay for more details. n

OUTSTANDING MEMBER OF THE YEAR Nominate a VSCPA member who has provided outstanding service to the profession through participation in VSCPA activities, civic engagement and charitable activities that further a positive image of accounting and the CPA profession.

Nominations are due by Friday, Dec. 5. Nominate online at www.vscpa.com/Awards or email VSCPA Member Relations Specialist Laura Cobb at lcobb@vscpa.com. n

>> STAFF SPOTLIGHT: DIANE JONES POSITION: VSCPA Finance and Human Resources Manager BIRTHPLACE: Richmond FAVORITE VACATION SPOT: I like the tropics, so wherever there’s sun sand and seashells, I’m in!

RECENTLY READ BOOK: “The People Factor” by Dr. Van Moody FAMILY: Daughter, Shaina PREVIOUS JOB: I returned to the Richmond area in 2000 to work for a political subdivision. It was a state-affiliated agency that provided financing for public projects to Virginia localities. I was there for six years before coming to the VSCPA. WHAT DO YOU LIKE TO DO OUTSIDE OF WORK? Outside of RELAXING, I enjoy spending time with my family and friends, planning and attending events, trying

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new restaurants and traveling.

WHAT’S YOUR FAVORITE PART OF YOUR JOB? The variety in my responsibilities.

Primarily, I work in accounting, but since that supports all areas of the company, I’ve been able to learn membership, CPE, PAC and some marketing. My current focus is learning more about human resources laws and policies so I can excel in my current role.

WHAT’S SOMETHING PEOPLE DON’T KNOW ABOUT YOU? I was a “Daddy’s girl” growing up, so I like football (go Cowboys!), boxing and fast cars. n

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VSCPA news

Congratulations to the following members! supervisor and MALLORY WERTH, CPA, and JOSH GANNETT, CPA, to audit senior.

collected more than $1,000 worth of school supplies in its School Supplies Drive.

APPOINTMENTS & AWARDS >>

FIRM NEWS >>

HUGH BARLOW, CPA, office managing partner of Dixon Hughes Goodman’s Newport News office, has been named a member of the Newport News Police Foundation board.

GORDON BERNHARDT, CPA, president and CEO of Bernhardt Wealth Management in McLean, has been named to Northern Virginia Magazine’s Top Financial Professionals List for 2014.

Clockwise: Lindsay Andrews, CPA; Terry Barrett, CPA; David Peters, CPA; Jeff McCurry, CPA

NEW HIRES >> TERRY BARRETT, CPA, has joined Keiter as a senior tax manager in the firm’s state and local tax practice in the Glen Allen office.

ELIZABETH HAMILTON, CPA, has joined Norfolk firm McPhillips, Roberts & Deans as a staff accountant in the firm’s tax practice.

Fairfax firm Thompson Greenspon has hired JEFF McCURRY, CPA, as tax manager and JESSICA BROWN, CPA, as a staff tax accountant.

JAMIE WOHLERT, CPA, has joined the U.S. Securities and Exchange Commission (SEC) as an assistant chief accountant.

PROMOTIONS >> Fairfax firm Thompson Greenspon has promoted LINDSAY ANDREWS, CPA, to audit manager, TRICIA NEALE, CPA, to tax manager, ERIC PANIAN, CPA, and JON-MICHAEL ROSCH, CPA, to audit

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WAYNE EDMUNDS, CPA, of Gregory & Associates has been named treasurer of the Henricus Foundation Board of Trustees.

ARTHUR ROBINSON, CPA, of Wolcott, Rivers, Gates has been elected president of the Hampton Roads Estate Planning Council.

Three VSCPA members have been selected for Leadership Metro Richmond’s Leadership Quest Class of 2015: >> JULIE GUSTAVSSON, CPA, of Keiter >> DAVID PETERS, CPA, of CompareNow.com >> DAPHNE WALKER, CPA, of Junior Achievement of Central Virginia

PUBLICATIONS >> GARLAND CREIGHTON, CPA, has published his first book, “Coming Alongside: Exchanging the Anguish and Heartache of Caregiving for Laughter, Love and Peace of Mind.” The book is available in paper and e-book format. Visit www.ComingAlongside. com to purchase a copy.

PHILANTHROPHY >> COUNCILOR, BUCHANAN & MITCHELL

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Inside Public Accounting has released its annual ranking of the 100 largest accounting firms. The following Virginia firms made the cut: ARONSON LLC BAKER TILLY VIRCHOW KRAUSE BDO USA CHERRY BEKAERT CLIFTONLARSONALLEN DELOITTE DIXON HUGHES GOODMAN ELLIOTT DAVIS ERNST & YOUNG GRANT THORNTON KEARNEY & COMPANY KPMG MCGLADREY PRICEWATERHOUSECOOPERS RAFFA WATKINS MEEGAN

MERGERS AND ACQUISITIONS >> BROWN EDWARDS has acquired Roanoke tax practice MDR TAX & FINANCIAL SERVICES. COUNCILOR, BUCHANAN & MITCHELL (CBM) has merged with Washington, D.C., firm DROLET & ASSOCIATES. The firm will keep the CBM name.

MCGLADREY has acquired Dayton, Ohio, firm BATTELLE RIPPE KINGSTON.

CHAPTER NEWS >> The VSCPA RICHMOND CHAPTER will hold its annual dinner Tuesday, Nov. 11. The entire event, including a 2-hour CPE session, a networking hour and dinner, will run from 3–8:30 p.m. Visit www.RichmondCPAs.org to get more details and register. n

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VSCPA news

We mourn the loss of:

Staff news

ISAAC PERKINS, CPA, a VSCPA life member from Roanoke. A U.S. Army veteran who served in World War II, he graduated from the University of Virginia and was a partner at Andrews Burkett & Company.

LAWRENCE RAMSEY, CPA, a sole proprietor from Richmond. He served on numerous VSCPA committees and was a VSCPA chapter president. n

VSCPA BOARD OF DIRECTORS CHANGES VSCPA Board of Directors Vice Chair JAMIE WOHLERT, CPA, has resigned from the board after accepting a job as an assistant chief accountant with the U.S. Securities and Exchange Commission (SEC).

The SEC’s ethics rules preclude her from serving on the board.

VICKI JONES, CPA, a partner with Jones & Company in Crozet, will replace her as vice chair, while JIM PHILLIPS, CPA, a partner with KPMG in Richmond, will fill Jones’s position as an at-large director. n

Top: Kathy Suddarth, Stephanie Peters, CAE, Tracey Zink. Middle: Jennifer Harris, Linda Newsom-McCurdy, Chip Knighton. Bottom: Veronica Boyett.

>> CONGRATS TO THE VSCPA’S NEW CPAs JESSICA CONRADI J.J. EDMUNDS JOHN FOGARTY JR. SHAZAD HUSSAIN DILBAR KHAKIMOVA

ALEX KOUZEL BRIAN LAPIERRE AARON SHAPIRO JEFF VIRGA NIMA ZABIHI

List from August and September. Compiled Sept. 25, 2014. In previous issues, we printed the names of all new CPA licensees in Virginia. Moving forward, we will only print the names of new licensees who are VSCPA members. n

FIND THE CPE TEST ONLINE We no longer print the Self-Assessment Exam in Disclosures. The exam is available online for 1 CPE credit at www.vscpa.com/public/catalog. Choose the “On Demand” tab to find it and exams from previous Disclosures issues. n

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The VSCPA welcomes two new employees: Education Coordinator KATHY SUDDARTH and Education Assistant DORIS PENNINGTON. Welcome aboard!

VSCPA President & CEO STEPHANIE PETERS, CAE, celebrates her 17th anniversary with the Society on Dec. 1. Academic & Career Development Coordinator TRACEY ZINK celebrates her 16th anniversary with the VSCPA on Nov. 2.

Marketing Manager JENNIFER HARRIS celebrates 10 years with the VSCPA on Nov. 1. Education Director LINDA NEWSOMMCCURDY marks seven years with the VSCPA on Nov. 13.

Communications Specialist CHIP KNIGHTON celebrates his fourth anniversary with the Society on Dec. 13. Conference Specialist VERONICA BOYETT marks two years with the VSCPA on Nov. 1.

Business Development Associate JIM BERRYMAN has left the VSCPA. Good luck, Jim! n

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VSCPA news

2

1

4

3

>> 2014 CPA DAY OF SERVICE

5

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1.

Meadows, Urquhart, Acree & Cook staff served breakfast and cleaned up at Hospital Hospitality House in Richmond.

2.

Gregg Bailey partner Brad Gregg, CPA, gets ready to make a delivery for Backpacks of Love.

3.

Todd Swisher, CPA, of PBMares, does landscaping work for Virginia Supportive Housing.

4.

Mitchell Wiggins employees pose while doing landscaping work for Richmond Residential Services

5.

Ryan Shipley, CPA, and Rebecca Bourne of Elliott Davis pack dog treats at the Richmond Society for Prevention of Cruelty to Animals. n

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VSCPA educational foundation SCHOLAR PROFILE >>

Tax or audit? Shai Sumpter chose neither. merchandising industry, and Newport News Shipbuilding, where she got experience working with vendors and dealt with more of the numbers side.

She hasn’t closed the door on getting her CPA license and “maybe doing something on the side with that that might not be my main source of income,” but for now, accounting is just part of a complete business education.

With help from scholarships from the Foundation and others, Shai was able to pay for her college without taking out any student loans. That’s a big reason she chose Norfolk State, where she’s enrolled in the honors program, although its proximity to her Newport News home was another factor.

“I’m a very frugal person, so I don’t like to owe people anything. It was a personal decision,” she said. “I made a goal my senior year of high school that I didn’t want to have my family pay for any of my education.”

While the financial support from the Foundation is a big reason she’s glad she’s a VSCPA member, she’s grateful for the resources and information she’s gotten from her membership as well.

In conversations about their future careers, VSCPA student members often face the age-old question: Tax or audit? Shai Sumpter chose door No. 3.

Sumpter, a senior at Norfolk State University and a recipient of the VSCPA Educational Foundation’s Minority Scholarship, plans to strike out on her own after graduation. She’s keeping her cards close to the vest regarding her business plan (although she’ll admit to it being an apparel kiosk) but one thing she’s absolutely clear on is the value of accounting to her business future.

“When I first came to Norfolk State, I was an entrepreneurship major,” she said. “When I was thinking about that, I decided entrepreneurship isn’t something you learn, it’s something that’s a part of you. The next best major was accounting, which is something that all businesses incorporate into their daily dealings. So that’s why I chose to study it.”

Her business plan took second place in a Norfolk State competition, and she’s working hard to find investors and make it a reality. To that end, her internships haven’t been the traditional accounting jobs either.

She worked at JCPenney, where she learned more about the fashion

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“It made me realize all the resources that are out there and additional things that I can do while I’m still in school that can help me prepare for the CPA Exam,” she said. “It also helped me realize what employers are looking for. Instead of saying ‘I should have done that,’ I can do the things that they’re looking for.” n

>> DONATE TO THE ANNUAL FUND The Foundation is seeking support for the Annual Fund, which funds scholarships for high-achieving accounting students pursuing an undergraduate, graduate or doctorate degree. Gifts to the Annual Fund allow us to achieve our goal of inspiring and supporting future CPAs. Donations support student scholarships, the Leaders’ Institute and other important Foundation programs and services. Unrestricted gifts to the Annual Fund help ensure the Foundation will continue attracting future CPAs year after year. Visit www.vscpa.com/ DonateFoundation to donate now. n

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VSCPA educational foundation

Thank you, Foundation donors!

Thank you to all our generous contributors who have given to the VSCPA Educational Foundation in 2014. Want to join the list? Support your profession today at www.VSCPAFoundation.com! $5,000 OR MORE Kearney & Company

$2,500 – $4,999 Hantzmon Wiebel, LLP Keiter McPhillips, Roberts & Deans, PLC Mitchell Wiggins & Company, LLP

$1,000 – $2,499 Anonymous James E. Harris, CPA Bradley P. Nicklin, CPA PBMares, LLP Vugar T. Shahtakhtinskiy, CPA Virginia Society of CPAs Wells, Coleman & Company, LLP

$500 – $999 BDO USA, LLP Thomas M. Berry Jr. CST Group, CPAs, PC Susan Q. Ferguson, CPA Heather K. Flanagan, CPA Richard A. Garbee, CPA Gerald L. Hagen Jr., CPA Staci A. Henshaw, CPA Hunt & Calderone H. William Kuehl Jr., CPA Andrew and Holly Martin Randolph Shapiro, CPA James M. Shepherd, CPA Randall R. Spurrier, CPA Mark A. Watts, CPA

$250 – $499 Anonymous Courtney S. Barrack, CPA Beth A. Berk, CPA O. Whitfield Broome Jr., CPA Carol T. Chappell, CPA Wayne R. Eggleston, CPA

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Joseph J. Latella, CPA Clare K. Levison, CPA Brian K. Marks, MBA, CEBS John L. Matherly, CPA Martha Sedwick Mavredes, CPA Julie A. Melampy, CPA Roy D. Peters, CPA Dilys J. Phillips, CPA Abbas A. Rawoot, CPA Julia W. Rogers, CPA Elsie L. Rose, CPA L. Darlene Selz, CPA Laura A.Tate-Smith, CPA Michael H. Tesfamichael, CPA Thompson Greenspon Melissa Ware David H. Tikkala, CPA Monique T. Valentine Ford, CPA Donna P. Yenney, CPA Wayne A. Yowell, CPA Dr. & Mrs. Douglas E. Ziegenfuss

George D. Forsythe, CPA Richard E. Groover, CPA William E. Hardy, CPA Terence W. Kimm, CPA Thomas J. Lyden Jr., CPA Mark A. VanDeever PC Joseph S. Mastaler Jr., CPA Jill E. Mitchell, CIA A. Marshall Northington, CPA Stephanie R. Peters, CAE Stephanie S. Saunders, CPA Gary R. Thomson, CPA Frederick L. White, CPA Kristin L. White, CPA Jamie C. Wohlert, CPA

$100 – $249 Anonymous Joan D. Aaron, CPA Alliant Techsystems Operations LLC Robert G. Baldassari, CPA Victor F. Bouril Jr., CPA James W. Brackens Jr., CPA Maria T. Bridges, CPA W. A. Broadus Jr., CPA Adam G. Chaikin, CPA James D. Cole, CPA Thomas M. Crutchfield, CPA Jaime Lynn Dernar, CPA Gary D. Dittmer, CPA Burnice C. Dooley, CPA Marc E. Filer, CPA Joel T. Flax, CPA Susan B. Gregg, CPA Leonard R. Grus, CPA Samuel A. Hicks Jr. Victoria W. Jones, CPA David A. Kemah, CPA David F. La Mar, CPA Tina Lambert, CAE

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Emily M. Maffey, CPA Christina R. Molinary, CPA Vicki L. Petitt, CPA Melanie E. Randall, CPA Elizabeth L. Roberts, CPA Tom E. Rosengarth, CPA, CMA Kathleen M. Rusinski, CPA Jayne E. Schwarz, CPA Duff A. Scudder, CPA Laura E. Seal, CPA John R. Simmerman, CPA David H. Smith, CPA Diana F. Smith, CPA Frederick D. Streb Jr., CPA Kevin S. Ubelhart, CPA Daniel M. Vitez, CPA Michael L. Wagner, CPA William H. Watson Jr., CPA Brian J. Wendroff, CPA Colette Y. Wilson, CPA n

$50 – $99 Anonymous (2) Franklin B. Austin III, CPA Glenn E. Barbour, CPA Elmar T. Chakhtakhtinski Donald M. Dale Maureen Dingus, CAE Benjamin S. Equitan, CPA Travis S. Floyd, CPA Jerry L. Forehand, CPA Nancy E. Fry, CPA Stanley C. Gibbs, CPA Deborah E. Haines, CPA Kenneth H. Heller, CPA Kathleen M. Kauffman, CPA Sonia L. Kessler Malcolm H Lathan Jr., CPA Duryea K. Leftwich Gabriele Lingenfelter, CPA

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A full list of all donors is available at www. vscpafoundation.com.

Donations listed were received between Jan. 1 and Sept. 30, 2014. Every effort has been made to ensure the accuracy of our list. Please contact the VSCPA Educational Foundation at (800) 733-8272 or info@ vscpafoundation.org to report errors or omissions.

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CLASSIFIEDS GROWTH, SALES & ACQUISITIONS NORTHERN VIRGINIA CPA SEEKS TO ASSOCIATE WITH ENERGETIC CPA who is interested in the eventual takeover of the practice. Strong technical skills in both reporting and tax a must. Ideal candidate will be individual who is committed to working in public accounting and has started their own practice. Respond with resume and cover letter to: VSCPA CC #89, 4309 Cox Road, Glen Allen, VA 23060 or classifieds@vscpa.com.

PLANNING A SALE? Learn more by downloading our free Succession Planning Guide at www.PoeGroupAdvisors.com.

QUALITY, PROGRESSIVE AND WELL-ESTABLISHED MANASSAS, VIRGINIA CPA FIRM looking to expand practice through purchase opportunities. Ideal candidate includes tax practice with both business and individual clients or firm with specialized services, including DCAA experience, but not looking for attest/ audit work. Great opportunity for retirement-minded practitioners.

Principals only, no brokers. Reply in confidence to Box #92, VSCPA, 4309 Cox Rd, Glen Allen, VA 23060 or classifieds@vscpa.com.

CHESAPEAKE VA CPA FIRM wishes to associate with energetic CPA who is interested in eventual takeover of practice. Strong technical skills and tax a must and committed to working in public accounting.

Respond with a resume : cpa@edmars.hrcoxmail.com.

POSITIONS AVAILABLE ACCOUNTANT/CPA — MANAGER LEVEL CPA for a dynamic and progressive local firm in Manassas, VA. At least 10 years recent public accounting experience required. ProSystem FX and QuickBooks experience a must. Will consider recently retired practitioner or a temporary tax season position. Competitive compensation. Send resume and salary requirements. Reply in confidence to Box #93, VSCPA, 4309 Cox Rd, Glen Allen, VA 23060 or classifieds@vscpa.com.

RAPIDLY GROWING DUAL LOCATION CPA FIRM on Virginia’s eastern coast seeks a merger, acquisition or outright sale. Also a great opportunity for an experienced CPA to step into a partner slot.

Primarily corporate, individual, trust and estate work. High fees and impressive cash flows. Reply in confidence to (Box #94) VSCPA, 4309 Cox Road, Glen Allen, VA 23060 or vscpa@vscpa.com.

THINKING OF RETIREMENT OR A CAREER CHANGE? Naab Consulting has been assisting sellers of accounting and tax practices for over 17 years. We specialize in selling only accounting practices and therefore understand the market. We offer no-obligation, confidential on-site personal consultations to discuss your situation personally. We offer a large database full of qualified buyers, financing for your buyer and confidentiality throughout the entire process. If you like the idea of an experienced professional to guide you through the selling process, please contact us today at 888.726.6282 or Retire@NaabConsulting.com. Mention promo code #24 for additional incentives.

WELL ESTABLISHED AND DIVERSIFIED SMALL NORTHERN VA CPA FIRM seeks sale/merger opportunities. Practice clientele includes reviews, compilations, write-up services and one non-profit audit. The firm has a significant individual income tax practice as well as a variety of business tax returns. The firm enjoys a long-standing on-site and unqualified or pass peer review history. The firm is that of a sole practitioner seeking retirement or semi-retirement over the next 2 years. Growth and referral opportunities are excellent. Reply in confidence to Box #91, VSCPA, 4309 Cox Road, Glen Allen, VA 23060, or vscpa@vscpa.com.

DISCLOSURES

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ONLINE CLASSIFIEDS at www.vscpa.com/Ads The VSCPA now offers online classifieds! Post and search in these categories: Mergers & Acquisitions, Office Space and Services.

Monthly posting starts at $250. Plus, manage your ad online, include your logo and more!

Prefer printed classifieds in Disclosures?

Contact us at classifieds@vscpa.com or visit www.vscpa.com and click on “Advertise, Sponsor or Partner” under “For Members.”

NOVEMBER/DECEMBER 2014

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HTTP://DISCLOSURES.VSCPA.COM

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I AM the vscpa FROM AFGHANISTAN TO ACCOUNTING >>

Two minutes with Rob Persons ROB PERSONS >>

Lessons learned on the battlefield provide perspective.

Rob Persons is an audit associate with KPMG, working in the Washington office. He joined the U.S. Marine Corps out of high school and served in Operation Enduring Freedom in Helmand Province, Afghanistan, before leaving the service in 2008. He then took advantage of the Post-9/11 G.I. Bill and earned his bachelor’s and master’s degrees in accounting at the George Washington University, where he founded the GW Veterans student organization. Persons, who grew up in Texas and Florida and completed boot camp at Parris Island, S.C., and basic training at Camp Lejeune, N.C., is an active member of the U.S. Marine Corps Reserve.

I AM PASSIONATE ABOUT… Government accountability and ensuring that taxpayer dollars are used efficiently and not wasted. This allows me to continue to serve my country when not in uniform.

PEOPLE DON’T KNOW THIS, BUT… I love to host backyard pig roasts. There’s nothing better than having 40 of your closest friends over and sharing a great meal with them. It’s also a great way to meet your neighbors!

IF I WEREN’T AN ACCOUNTANT, I WOULD BE… A physicist.

Before I joined the Marines, I was accepted as a physics major, and I feel that there is nothing greater than the desire to understand the world

38

DISCLOSURES

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NOVEMBER/DECEMBER 2014

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around us. As Neil deGrasse Tyson said, “The good thing about science is that it’s true whether you believe it or not.”

MY ADVICE TO FELLOW ASPIRING CPAs IS… Make a realistic plan that can be followed and always remember what you are working toward.

I NEVER LEAVE HOME WITHOUT… My wedding ring. It’s been less than a year, and I am still not used to it.

I WISH ASPIRING CPAs KNEW… There are more stressful things in life than a test. Relax and enjoy the journey.

I ASPIRE TO BE A CPA BECAUSE… I want to have the ability to make an impact in the world. n

HTTP://DISCLOSURES.VSCPA.COM

The new merger/acquisition season is underway. A list of the active opportunities is available below. Email info@poegroupadvisors.com for more information on any of these opportunities. Also, feel free to call.

Tel. 888 246-0974

www.poegroupadvisors.com Listing Number

Location

Annual Gross

Asking Price

VA1056

Midlothian, VA

$275,000

$285,000

NC1085

Winston-Salem, NC

$695,000

$700,000

NC1095

Raleigh Area, NC

$466,000

$495,000

NC1096

One Hour from Piedmont Triad

$772,000

$795,000

VA1052

Northern Neck of Virginia

$283,000

$295,000

NC1082

Charlotte/Lake Norman, NC

$147,000

$135,000

NC1093

Asheville Area, NC

$227,000

$240,000

NC1092

Raleigh Area, NC

$2,100,000

NC1091

Northeastern, NC

$103,000

$105,000

VA1053

Richmond, VA

$435,000

$460,000

SC1057

West Columbia, SC

$195,000

$199,000

VA1055

Covington, VA

$202,000

$199,000

SC1060

Sumter, SC

$67,000

$75,000

NC1099

High Country, NC

$317,000

$350,000

SC1059

Lexington, SC

$137,000

$150,000

NC1094

Asheville, NC

$850,000

$895,000

NC1097

Concord, NC

$102,000

$110,000

SC1058

East of Columbia, SC

$287,000

$315,000

PRSRT STD US POSTAGE PAID PPCO

Virginia Society of CPAs 4309 Cox Road Glen Allen, VA 23060

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