The straight line

It’s been close to a decade since the high profile fraud incidents at Enron, WorldCom, and Adelphia took place, and the antifraud provisions of the Sarbanes-Oxley Act of 2002 were enacted. We’ve seen additional legislation enacted recently in the Dodd-Frank Wall Street Reform and Consumer Protection Act. So, is corporate fraud under control as a result?

The dilemma is that Section 199 and bonus depreciation are effective ways to mitigate taxes, but they tilt the imbalance in member’s equity further towards retained earnings. We are trying to address this with our coop clients so that decisions are made with an understanding of how they affect members in the current and future years.

Under the recommendations, a separate private company standards board would be established to make exceptions and modifications for both new and existing standards.

In addition to the changes made for Bonus Depreciation and 1099 reporting, several other items of interest were changed by the recent legislation for 2011 and 2012:

The latest tax law changes passed in 2010 enhanced available bonus depreciation from 50% to 100% for property placed into service between September 9, 2010 and December 31, 2011. 

January is the month that 1099’s are prepared and distributed. As a cooperative, the form 1099 PATR is used to report information to your patrons. The following are items typically associated with cooperatives and should be reported as described: