January 9, 2020: Tax News Roundup

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Below we have our first bimonthly tax news roundup of 2020. Check out these new rules, regulations and information all practicing tax professionals should be acquainted with.

New tax laws in effect in Virginia as on January 1, 2020

While Virginians are ringing in the new year, new tax laws are going into effect in the Commonwealth. As of January 1st, 2020, a number of new laws will change the way people in Virginia shop and do their taxes.

One law is a sales tax decrease on certain goods deemed essential hygiene products. The laws bring the sales tax on those products down to the rate previously reserved for food and other necessities. Continue reading on NBC29.com.

Avoid tax return surprises by filing out this new form

There’s a new federal income tax withholding form, and a good reason to fill it out fresh this year. It’s the first major update to the form since Congress made sweeping changes to the federal tax system in 2017, backed by President Donald Trump.

While a majority of filers owed less in federal taxes last year after the legislation took effect, many were surprised to get a smaller refund than they expected. Filling out the new withholding form, known as the W-4, could fix that problem by making sure the right amount is withheld from your paycheck — even though filers are only required to fill out the form if they are starting a new job in 2020. Continue reading on WROP.com.

2020 sees a rise in digital services taxes

Italy, Austria and Malaysia have joined ranks in taxing the technology giants, with all three countries’ DSTs (Digital services taxes) effective from January 1, 2020. A wave of other countries including the UK, Turkey and the Czech Republic have introduced, or are considering, their own mechanisms for DSTs.

The DSTs target overseas businesses that provide digital services to domestic consumers but where their profits are only taxed in their parent jurisdiction. Countries have adopted these measures because they say such companies should pay local taxes on transactions within the market jurisdiction. Continue reading on internationaltaxreview.com.

Why the Impact of the Trump Taxes Remains Partly Hidden

Armed with legions of lobbyists, companies have been pushing hard — and successfully — to weaken new federal taxes that take aim at overseas tax havens.

Many of them have managed to avoid publicly disclosing how much they owe under the new taxes. Without such figures, it becomes virtually impossible for outsiders to work out how much companies are saving from the watered-down tax rules.

In theory, this opacity should not exist. United States securities regulations have long required public companies to disclose even relatively minor tax expenses. Over the past year, this requirement has led to a small number of companies revealing the effect of the new taxes on overseas income. Continue reading on the NYtimes.com.

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Liz Mason is a serial entrepreneur, a giant nerd, and an involved accounting vanguard. She is the Founder of High Rock Accounting, Rebel Rock Accounting, TheDepartment.Tax, and a few other related brands. Liz speaks on a national stage, guests stars on podcasts, publishes a YouTube show (The Hot Accounts), and writes frequently. To further her passion for the advancement of the accounting profession, Liz currently serves as a Xero National Ambassador and as the Content Strategist for Tax Practice News. Liz started her career in tax at Grant Thornton (at 20) and automated a portion of her job landing her in the national tax practice. She spent a decade in large public accounting firms working on highly technical tax consulting before branching off on her own. Liz utilizes her creativity and passion at her company to uproot traditional practices and replace them with innovative concepts. She finds joy in efficient technology and her core belief is that everyone and everything can continuously improve (she says "be better" too often). When Liz isn't planning world domination in accounting, she is a die-hard skier, down for any adventure, plays the ukulele, reads everything, and has a good sense of humor. If you're looking for her, you can find her traveling the world and enjoying new food and cultures with her husband and young son. Follow Liz and High Rock Accounting on Twitter at @LizzyNorMa and @HighRockCPAs.