Articles From Lumsden McCormick

Lumsden McCormick has released its annual Federal Tax Rate Guide.

For 2025, many business tax limits have increased due to inflation adjustments. Key changes include higher limits for Section 179 expensing, standard mileage rates, and various retirement plan contributions.

Manufacturers are increasingly integrating advanced technologies like IIoT, robotics, and automation, which makes cybersecurity more critical than ever. The convergence of IT and OT systems presents unique cybersecurity issues, and manufacturers must adopt robust cybersecurity frameworks, conduct risk assessments, and prioritize employee training to mitigate risks.

When planning your estate, leaving specific assets to specific heirs might seem like a good idea, but it can lead to unintended consequences. For example, changes in asset values over time can result in unequal distributions among heirs, potentially disinheriting some family members. To avoid such outcomes, consider distributing your wealth based on percentages or dollar values rather than specific assets.

Cost allocation procedures for nonprofit organizations are necessary to comply with GAAP standards and provide transparency to donors and funders. It outlines the need to analyze expenses by nature and function, categorize supporting activities, and disclose the methods used for expense allocation. Proper cost allocation ensures accurate financial reporting and helps nonprofits manage their resources effectively.

Relocating a trust to a state with low or no income taxes can offer significant tax advantages, especially for irrevocable, non-grantor trusts that accumulate substantial income.

Charitable fundraisers featuring games of chance, such as bingo, raffles, baccarat, and roulette, are popular ways for nonprofits to raise money. However, hosting gambling events comes with certain tax-related responsibilities, including reporting participant winnings and ensuring compliance with IRS rules and state regulations. To remain compliant, nonprofits should plan accordingly.

Work-in-Process (WIP) refers to partially completed goods in the manufacturing process, encompassing costs of raw materials, labor, and overhead. Monitoring WIP helps identify production inefficiencies, optimize processes, and manage inventory effectively.

In 2025, both new and used heavy SUVs, pickups, and vans can offer significant first-year depreciation write-offs if used more than 50% for business purposes. Additionally, setting up a home office can further enhance tax savings by allowing you to qualify for home office deductions, making it easier to pass the over-50%-business-use test for your heavy vehicle.

Estate planning for individuals living outside the United States involves understanding domicile and residency, navigating tax implications, and considering asset location and jurisdiction. It also requires awareness of marital deduction rules, succession laws, and the importance of professional advice to ensure a comprehensive and compliant estate plan.