January 30, 2013

Managed Sale of MLB Team and its Assets

Managed the sale of a Major League Baseball team and its assets from its current stadium, which was being torn down to make room for a new stadium.  Using these assets from the old stadium, we managed the creation of over 30 different licensed products, a national auction, and a massive live event that generated $6 ½ million in revenue for the team.

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January 19, 2013

Analyzed Financial and Inception Records for trial in United States Tax Court

January 9, 2013

Used Cost Segregation to Increase Cash Flow

Our client was considering purchasing an office building at a cost of $19 million. We suggested a cost segregation study, which generated an $800,000 net present value of after tax benefits. Cost segregation analyzes buildings and identifies components that can be depreciated over 5, 7 or 15 years rather than the standard 39 year period. This reduction allowed our client to defer income taxes and increase cash flow.

Learn more about our Tax Planning and Compliance services and Real Estate expertise.

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January 8, 2013

Anders Minkler & Diehl and Huber, Ring, Helm Announce Plans to Merge

Anders Minkler & Diehl LLP (AMD) and Huber, Ring, Helm & Co. P.C. (HRH), two of the top ranked accounting and advisory firms in St Louis, today announced plans to merge their practices.

AMD Partners and HRH Principals have agreed to the combination and terms. Pending final approvals, the merger is anticipated to take effect January 1, 2013. The new firm will have more than 160 partners and staff members, with approximately $26 million in revenue. While the legal name of the firm will be Anders Minkler Huber & Helm LLP, effective January 1, we will be marketed as ANDERS under a new brand platform.

“This merger will bring together two firms of significant scope to offer an unprecedented local emphasis on serving privately-held businesses and individual clients,” said Robert J. Minkler, Jr., CPA, managing partner at AMD. “The combination of these two great organizations provides us with the opportunity to continue to deliver the exemplary service and personal attention we are known for individually, but from a position of greater size and strength collectively. This merger allows us to retain our commitment to remain a local firm, while being one of the largest firms not only in the St. Louis marketplace, but throughout the Midwest.”

Thomas S. Helm, CPA, HRH president and CEO, said “together we will be the firm of choice for privately-held companies and individuals seeking the freedom to follow their passions, by allowing us to handle their financial needs through comprehensive services, deep industry experience and client commitment. In addition to offering greater synergies for our clients, we believe it will also offer additional opportunities and greater potential for our staffs.”

According to Minkler and Helm, both firms have very diverse clients across a wide variety of industries. Combined, the new firm will be a powerful resource in health care; sports, arts & entertainment; manufacturing and distribution; construction and real estate; not-for-profit; family wealth & estate planning, employee benefit plans; and other industries, in addition to a strong technical foundation in tax, audit, forensics and valuation, and advisory services.

Both AMD and HRH were started in 1965. While this is the first overall firm merger for AMD, which most recently merged the Barnes Sports Group into its Sports, Arts & Entertainment Group, HRH has previously merged several smaller firms into their practice.

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January 4, 2013

Saved Unemployment Taxes with Tighter Controls

Using internal reports, we helped a client identify individuals who were being paid both as contractors and employees. This insight prevented the client from having to pay more in unemployment taxes.

Learn more about our Audit and Advisory services and Construction expertise.

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January 4, 2013

Real Estate Professionals Combining Activities

In the previous blog, we discussed how the Affordable Care Act has created a 3.8% surtax on investment income. To avoid the 3.8% surtax, investment income must be offset with investment losses or your income has to be considered non-passive. A rental property investor may achieve non-passive treatment through electing to be treated as a real estate professional.

Once it is determined that a taxpayer qualifies as a real estate professional, the non-passive treatment is available only for rental real estate activities in which the real estate professional materially participates. See previous blog for material participation.

A Real Estate Professional can elect to treat all interest (including limited partner interests) in rental real estate activities as a single activity. This election can be made in any year the special real estate professional rules apply. However, once the election is made, it is irrevocable unless there is a material change in the taxpayer’s facts and circumstances.

Material participation is determined for the combined activity as a whole when the election is made. The election to combine rental real estate activities may be crucial in allowing some taxpayers to meet the material participation tests or to meet the real estate professional requirements.

If the election is made, the combined rental real estate activity is treated as a single activity for all purposes including the disposition rules. Thus, suspended losses generally cannot be deducted until all (or substantially all) of the activities have been disposed of.
Also, if the election is made and 10% or more of the taxpayer’s share of gross receipts from rental real estate activities comes from limited partner interests, the combined activity is treated as a limited partner interest. The limited partner participation tests are more difficult to pass than the regular material participation tests.

If the taxpayer had net income from rental real estate activities in which he or she does not materially participate, keeping the passive status for those activities will allow that passive income to offset other passive losses. However, if the election is made, and he or she materially participates in the combined group, the net income or loss from the combined group is non-passive.
The decision to make the election will need to be made on a case-by-case basis. Contact your Anders advisor for further guidance.

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