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| December 15, 2007 | The
Newspaper of the NYSSCPA |
Vol.
10, No.22 |
Tax Updates Dished Up at Breakfast Conference
A beer quiz may be the last thing you’d expect at a conference, but if you’re a restaurant owner’s CPA, the answers to some of those quiz questions could come in handy when advising a client who’s contemplating adding a brewery to a bar and grill.
“Is a pilsner a lager or an ale?” Vince Hesketh, director of business development for Micropub Systems International, asked the professionals attending the Nov. 7 FAE Restaurant and Hospitality Conference at the FAE Conference Center in Manhattan.
A few of the financial professionals knew their beer, and answered correctly. A pilsner, golden-hued and highly hopped, is a lager.
Craft beer has become very popular, Hesketh said as he promoted a brewpub installation as a way to stay on the cutting edge of consumption.
“It’s definitely got the cool factor,” he said.
Perhaps less cool, but even more essential, was an earlier session that covered tax updates.
Tax Updates
Mark S. Klein, a lawyer with more than 20 years of experience in all levels of taxation and the editor of New York State Tax Highlights, gave attendees a lengthy list of rules, amendments and exceptions in the current Tax Code that apply to the industry.
For example, new legislation provides sales tax exemptions for certain property and services used to obtain long-term leases of commercial office space at the World Trade Center site and in Battery Park City, Klein said. Other, more restrictive exemptions are also available for similar activities in other parts of lower Manhattan.
Another new rule, effective Sept. 1, eliminated sales taxes on all clothing and footwear in New York City, regardless of cost, Klein said.
Here are a few other tax considerations detailed by Klein:
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Free hotel rooms provided to musicians, photographers and others are considered part of a vendor’s compensation and are subject to tax on the normal room rent.
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Mandatory gratuities are not subject to tax as long as 100 percent of the money is paid to employees.
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Photographs sold on paper, slide, negative, CD and video are taxable, while the sale of the same photograph delivered electronically is not.
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A new exemption exists for admission charges to a roof garden, cabaret or similar place of amusement for the purpose of attending a dramatic or musical arts performance.
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Data-processing services can be taxable until the final product is delivered electronically.
The morning conference included two other half-hour sessions and an open panel. Speaker David W. Henion, a Society member, discussed retirement plans and investing options. He urged attendees to remember that past performance does not guarantee future results.
“Everyone wants to time the market,” Henion said. “But it’s impossible to do.”
Henion spoke at length about the 2006 Pension Protection Act, which he called “the Sarbanes-Oxley for registered investment advisors,” and explained that the new provisions, among other things, allow employers to automatically enroll workers in 401(k) plans.
Henion also outlined the roles of a pension fund’s participants, sponsors and advisors, as well as cost considerations and various portfolios.
Occupancy costs for hotels were covered by Daniel Lesser, senior managing director and industry leader for the Hospitality and Gaming Group at CB Richard Ellis, who provided an overview of hotel economic performance in the United States. Ellis noted that New York City is currently second only to Las Vegas in hotel construction activity.
The conference was sponsored by the NYSSCPA’s Hospitality Industry Committee. Steven B. Chatwin, who chairs the sponsoring committee and also sits on the Society’s Industry Oversight Committee, served as conference chair as well.
Melissa Hoffmann Lajara, Associate Editor, can be reached at mlajara@nysscpa.org.
