KatzAbosch, one of the region’s leading certified public accounting, tax and consulting firms, is proud to announce that six more of our Certified Public Accountants: Michael Gentry, Terry Grant, Kent Thomas, Chris Clingerman, Anita Sheckells and Kristin Bailey have recently earned the Certified Construction Auditor (CCA) designation from the National Association of Construction Auditors (NACA), bringing the total number of CCAs employed with KatzAbosch to seven, including Claudia Wolter who earned her designation in 2011.

The National Association of Construction Auditors was created to enhance the control environment related to construction projects. Providing the professional Certified Construction Auditor (CCA) designation helps to instill confidence in employers and clients when they secure the services of a professional construction auditor.

In addition to the CCA designation, 6 of KatzAbosch’s Certified Public Accountants also hold the designation of Certified Construction Industry Financial Professional (CCIFP). This distinction shows an individual has met the highest standards of construction financial management. There are less than 20 CCIFPs in the state of Maryland and only 700 in the United States.

KatzAbosch is also the only member of The Construction Industry CPAs/Consultants Association (CICPAC) in the state of Maryland. CICPAC is a national association of CPA firms recognized by their respective markets for providing high quality financial and consulting services to over 6,000 construction entities. Each firm is the exclusive member in its area and must demonstrate proficiency in construction industry services and a reputation for high-quality work and integrity. Through CICPAC’s educational programs and the continuous exchange of ideas and information, members of CICPAC are able to stay at the forefront of the construction industry, allowing them to provide up-to-date services to their clients.

Regional accounting and consulting firm KatzAbosch recently announced that Cory B. Chaney has been named to Chair of the firm’s Medical Practice Services Group.

The Medical Practice Services Group is one of the firm’s most specialized and experienced teams. As Chair, Chaney will work directly with physicians and medical practices throughout the state of Maryland.  Members of this group must possess a comprehensive understanding of the medical profession and be well versed in all aspects of financial matters from assisting with mergers, acquisitions and sales of medical practices to cost management and budgeting.

 “KatzAbosch is extremely pleased to have Cory chair the Medical Practice Services Group,” says Mark R. Cissell, CEO & President of KatzAbosch.  “Cory’s breadth of technical knowledge combined with his practical experience in the medical and healthcare profession is an asset to our clients in these industries.”

 Chaney received a bachelor’s degree in accounting from Towson University and joined the firm in 2008. He is a member of several professional organizations including the American Institute of Certified Public Accountants (AICPA); the Maryland Association of Certified Public Accountants (MACPA); and the Maryland Medical Group Management Association (MGMA).

The REAL Deal

Welcome to the inaugural issue of The REAL Deal from the Partnership/Real Estate tax group!

 On February 24, the IRS issued Notice 2012-22, outlining the modification of the energy savings percentages used in qualifying for a partial tax code, Section 179D Deduction.  This modification is an additional set of energy savings percentages taxpayers may use to qualify for a partial tax code section 179D deduction, under permanent rule for property placed in service from February 24, 2012.

Specifically, the applicable Energy Savings Percentages provided under February 24, 2012 notice, are 25 percent for interior lighting systems, 15 percent for HVAC and hot water systems and 10 percent for building envelope.   Following is a table that summarizes the %’s applicable before and after this change.

Note – that the 179D energy deduction is currently available only for property placed in service thru12/31/2013.

Summary of Energy Savings Percentages Provided by IRS Guidance

Please contact Kent Thomas or Dina Bernstein if you have any questions or require additional information

The REAL Deal is prepared by Jane M. Brewer, CPA, MST, Chair of the KatzAbosch Partnership/Real Estate Tax Group

The SALT Shaker

Sales Tax on Rental Properties

Florida is known for white sandy beaches, warm sunny weather and..… no income taxes for individuals.  However, many individuals have discovered there is a “sales” tax on renting their Florida beach condos.  The state of Florida  is using information from the federal income tax return to locate individuals that own rental properties in Florida.  The state will mail an assessment notice based on the address and activity on the Federal tax schedule E.

Keep this in mind for individuals that report Florida rental activity on their individual income tax returns.  The tax only applies in specific circumstances and the KatzAbosch SALT Group can help evaluate any potential tax obligations.

 Please contact the KatzAbosch SALT Group if you want to reduce potential audit assessments.

The SALT Shaker is prepared by Andy Bareham, Chair of the KatzAbosch SALT Group

The SALT Shaker

Sales/Use Tax on CPA Firm Services

Currently in Maryland 12 specific services are subject to sales/use tax.  A bill has been proposed that would greatly expand the number of services subject to tax.  Two of these new services – cited below – will directly impact our practice:

11-101(m)

 (19) A tax preparation service

 (30) A management, a management consulting, a public relations, or ANY other business consulting service

 Almost every year this type of legislation is presented and thus far has been defeated.  The difference this year is that the legislation is sponsored by the powerful Chair of the House Ways and Means committee. I am concerned this bill will not “die in committee” as it has done in past years.

Additionally, the Governor’s Budget contains a new sales/use tax on “digital downloads.” There is a clause in this bill which could extend this new tax to e-filing of tax returns and CPE webcasts.

The state is looking for new revenue sources and they believe one of them could be the service economy. I try to not get worried about proposed legislation because the political world is too unpredictable but this may be the year some of these things become law.  Stay tuned.

The SALT Shaker is prepared by Andy Bareham, Chair of the KatzAbosch SALT Group

KatzAbosch hosted a breakfast meeting for the Maryland Chapter of CFMA on February 8.  The room was packed and in attendance were many influential people from the construction world including business owners, CFO’s and insurance and bonding specialists.  Zafar Farooqi from Capital Construction Consultants, Inc gave an excellent presentation on Construction Contract Claims.  It was evident from the group discussion that claims are more prevalent than ever in the current economic climate. After a brief instruction of claims certification and providing proper notice, the group greatly benefited from the case studies and graphic analysis describing delay impact claims, their cause, effect, and most importantly the recovery.

submitted by: Anita M. Sheckells, CPA, CCIFP

One of the region’s leading certified public accounting, tax and consulting firms, KatzAbosch, announced today that Scott Mattingly, CPA, CFP has been named a member of the Board of Directors of The Babe Ruth Birthplace Foundation, Inc. and Sports Legends Museum at Camden Yards. The Babe Ruth Birthplace Foundation is a nonprofit organization dedicated to preserving and celebrating the legacy of Maryland’s rich sports heritage. The Foundation owns and operates both Sports Legends Museum at Camden Yards and the Babe Ruth Birthplace.

Members of the Board of Directors contribute to the Museum’s mission by providing cultural and educational experiences through dynamic exhibits and programs. Members strive to increase community outreach while preserving and commemorating local and regional sports teams as well as individuals.

Mattingly says he is thrilled and honored to serve on the Board and to be able to contribute to the museum. He looks forward to continuing to build and enhance the Museum as the premier destination for sports enthusiasts for many years to come.

KatzAbosch is proud to announce that SmartCEO Magazine will be honoring our very own Arlene Ciroula as Smart COO of the Year at their SmartCXO Awards on March 22^nd.

Chief Operating Officers nominated for this award had to demonstrate the following:

• leadership by creating and communicating the strategy and mission of the company to all staff members
• implementation of coaching and recognition programs to align the staff with the company’s goals
• effective management of staff levels, expectations and knowledge
• prioritization of customer, employee and company requirements
• efficient oversight of an organization’s performance.

This is a huge honor for Arlene and our firm.

KatzAbosch is proud to announce that three of the firm’s managers, Andrew L. Bareham, CPA, MST, Kristin N. Hucht, CPA, and Josh A. Sutherland, CPA have been promoted to Principals.

Being promoted to Principal is a huge honor within the firm. The role of a Principal is a high-level technical position that includes managing several ongoing jobs while communicating with shareholders, as well as managers and supervisors. It is their responsibility to monitor budgets, oversee the job process, and complete final reviews.

This promotion rewards managers who go above and beyond standard expectations. It is another example of KatzAbosch’s commitment to its staff by encouraging upward movement within the firm. KatzAbosch has been recognized as a “Best Accounting Firm to Work For” by Accounting Today magazine for the past 3 years in a row, as well as having earned several regional “best employer” awards, including “Healthiest Employer” by the Baltimore Business Journal, and “Baltimore’s Top Workplaces” by the Baltimore Sun.

The SALT Shaker

During 2011, a growing number of businesses were subjected to state tax audits. The state governments are starved for revenue and they realize the business community is a fertile source for unreported tax revenue, particularly sales/use tax.  Our experience representing clients in audits has shown that many businesses have misconceptions regarding the sales tax.  Consider the following questions with regard to your business:

• Does your business have a Maryland sales/use tax account? (If not, you are more likely to be audited by the state)
• Have you paid sales/use tax on all of your purchases of tangible property?
• Do you buy property over the Internet from out-of-state vendors?
• Do you either charge sales tax on all of your customer sales or collect an exemption certificate?
• Is your business ready for a Maryland sales tax audit?

The answers to these questions are crucial when the state of Maryland selects your business for audit.  The SALT Group at KatzAbosch is experienced at helping businesses ensure their readiness for state auditors.  We can review your records looking for compliance with state regulations and search for potential refund opportunities. Based on our recommendations, businesses are able to significantly reduce their exposure to audit assessments.

Please contact the KatzAbosch SALT Group if you want to reduce potential audit assessments.

The SALT Shaker is prepared by Andy Bareham, Chair of the KatzAbosch SALT Group