Articles From Lumsden McCormick

Manufacturing companies expanding across borders must understand transfer pricing to value intercompany transactions and comply with tax regulations. Proper documentation and adherence to IRS and OECD guidelines are crucial to avoid penalties and ensure accurate tax reporting. Proactive management of transfer pricing can also optimize global tax positions within legal boundaries.

New business owners can deduct up to $5,000 in startup and organizational costs, but only if total expenses stay under $50,000. Any remaining costs must be amortized over 15 years, and deductions can only begin once the business is actively operating. Careful planning and recordkeeping are essential to maximize tax benefits for new business ventures.

Find all of our latest news about the proposed One, Big, Beautiful Bill Act in one place. 

Avoiding probate in estate planning is crucial for ensuring a smoother and more efficient transfer of assets to beneficiaries. It helps to minimize legal costs, reduce delays, and maintain privacy for the estate and its heirs. Proper planning can significantly ease the burden on loved ones during a difficult time.

A recent U.S. Tax Court case highlights how poor documentation can lead to the disallowance of business expense deductions, including meals, supplies, and home office costs. The taxpayer failed to provide sufficient evidence linking the expenses to her business, underscoring the importance of maintaining accurate and timely records.

Qualified Charitable Distributions (QCDs) allow individuals 70½ or older to make tax-efficient donations directly from their IRAs to nonprofits, helping satisfy required minimum distributions while reducing taxable income. Recent updates under the SECURE 2.0 Act have expanded QCD limits and introduced new giving options offering donors more flexibility and nonprofits greater fundraising potential.

Qualified Charitable Distributions (QCDs) allow individuals aged 70½ or older to transfer funds directly from their traditional IRAs to qualified nonprofits, satisfying required minimum distributions (RMDs) while excluding the amount from taxable income. For 2025, individuals can contribute up to $108,000 annually ($216,000 for eligible couples), offering a tax-efficient giving strategy, especially for those who don’t itemize deductions. Recent updates through the SECURE 2.0 Act also introduced the option to make a one-time QCD enabling donors to support charities while receiving income for life. 

The OBBBA includes significant tax provisions that impact the U.S. manufacturing industry, such as resetting bonus depreciation to 100%, increasing Section 179 expensing limits, and making the QBI deduction permanent. Manufacturers should stay informed about these changes as the bill progresses through the legislative process. Please note that the tax law discussed in this article is currently proposed and has not yet been enacted.

The One, Big, Beautiful Bill Act proposes to restore the immediate deductibility of research and experimental (R&E) expenses, reversing the changes introduced by the Tax Cuts and Jobs Act (TCJA) that required these expenses to be capitalized and amortized over several years. If enacted, this bill would provide significant financial relief to innovation-focused businesses by allowing them to deduct R&E expenditures immediately. Please note that the tax law discussed in this article is currently proposed and has not yet been enacted.

An Employee Stock Ownership Plan (ESOP) offers a strategic way for closely held business owners to transition ownership while preserving wealth and minimizing taxes. By selling company stock to an ESOP, owners can gain liquidity, retain control, and create a valuable employee benefit, all within a tax-advantaged structure. However, the benefits must be weighed against setup and ongoing administrative costs.