Tennessee

Tennessee

CPA JOURNAL $3XEOLFDWLRQRIWKH7HQQHVVHH6RFLHW\RI&HUWL¿HG3XEOLF$FFRXQWDQWV

January/February 2014 Vol. 59 No. 1

Legal Issues in

TAXATION:

DOMA

AND WHAT PRACTITIONERS NEED TO KNOW

In This Issue: 4XDOLW\6WRUHV&DVH5HIXQG Opportunity or Trap for Tennessee Employers? Tennessee Business Tax Transition

&RQÀLFWVRI,QWHUHVW6WLOO Cause Trouble for CPAs 7D[$GYDQWDJHG,QYHVWLQJ IRU2OGHU3DUHQWVZLWK0LQRU &KLOGUHQ

Escape the city lights

Get back to nature.

TSCPA’s 2014 Annual Convention & Educational Conference MeadowView Conference Resort & Convention Center Kingsport, Tennessee | June 8-10, 2014 &RQYHQWLRQ+LJKOLJKWV ‡Golf Tournament6XQGD\-XQHDW&DWWDLOV*ROI&OXE ‡2SHQLQJ5HFHSWLRQ6XQGD\-XQHIHDWXULQJThe Scott County Boys ‡Annual Banquet0RQGD\-XQHIHDWXULQJD6LOHQW$XFWLRQDQGPXVLFE\Symphony of the Mountains Chamber Ensemble

&3(+LJKOLJKWV ‡1HZ&262)UDPHZRUNChristopher Sellitti, CPA, PricewaterhouseCoopers LLP, Charlotte, N.C. ‡0DQDJLQJWKH1H[W*HQHUDWLRQRI&3$VJessica Stollings, re:Generations, Bristol, Tenn. ‡3URIHVVLRQDO,VVXHV8SGDWHDavid K. Morgan, CPA, Lattimore Black Morgan & Cain, PC, Brentwood, Tenn. ‡7HQQHVVHH6SHFL¿F(WKLFVMark H. Crocker, CPA, Tennessee State Board of Accountancy, Nashville, Tenn. ‡(FRQRPLFDQG'HYHORSPHQW2XWORRNIRU7HQQHVVHHIliff McMahan Jr., Tennessee Department of Economic & Community Development, Johnson City, Tenn. ‡$FFRXQWLQJ6WDQGDUGV8SGDWHJames K. Myers, CPA, Individual Practitioner, Knoxville, Tenn. ‡)$6%6(&8SGDWHPatrick J. Gunning, CPA, Ernst & Young LLP, Atlanta, Ga. ‡,QYHVWPHQW2XWORRNDavid R. McCain, CFP, CIMA, CrossBridge Wealth Management, Johnson City, Tenn. ‡(VWDWH7D[8SGDWHAnne M. McKinney, Anne M. McKinney, PC, Knoxville, Tenn. Visit www.tscpa.com/AnnualConventionIRUXSWRGDWHLQIRUPDWLRQDQGUHJLVWUDWLRQGHWDLOV +RWHOUHVHUYDWLRQVPD\EHPDGHDWWKH0HDGRZ9LHZE\FDOOLQJRUYLVLWLQJWKHLUZHEVLWH,I\RXFDOO UHIHUHQFHWKHJURXS716RFLHW\RI&3$V7KH76&3$UDWHLVQLJKWDQGLVHIIHFWLYHXQWLO0D\

TABLE OF CONTENTS

6

12

18

36

FEATURES

SOCIETY NEWS

_4XDOLW\6WRUHV&DVH5HIXQG2SSRUWXQLW\RU7UDSIRU Tennessee Employers? By Randall K. Skalberg

5 | 0HVVDJHIURPWKH&KDLU

_7D[$GYDQWDJHG,QYHVWLQJIRU2OGHU3DUHQWVZLWK0LQRU &KLOGUHQ By Seth Hammer, CPA, Ph.D.

9 | 6FKRODU6SRWOLJKW

_/HJDO,VVXHVLQ7D[DWLRQ'20$DQG:KDW3UDFWLWLRQHUV 1HHGWR.QRZ By Anthony G. Masino, JD, CPA

28 | 7HQQHVVHH&3$3$&&RQWULEXWRUV

_&RQÀLFWVRI,QWHUHVW6WLOO&DXVH7URXEOHIRU&3$V By Duncan B. Will, CPA, ABV, CFF, CFE

32 | 3DVV-XO\$XJXVW&3$([DP

42 | Tennessee Business Tax Transition By Kelly Nolan Cortesi

COLUMNS _7(&+7,36 7HFKQRORJ\7UHQGVWR0RQLWRULQ By Thomas G. Stephens Jr., CPA, CITP

8 | 76&3$ V )LUP$GPLQLVWUDWRU0DQDJHPHQW7RRO

25 | Tennessee CPA Journal'LJLWDO(GLWLRQ

31 | &KDSWHUVLQ$FWLRQ

33 | 0HPEHU0LOHVWRQHV 34 | 3URPRWH