Month: January 2024

Tip Credit in New York: What You Need to Know

As New York State increased its minimum wage for 2024, many wondered what was going to happen with the “tip credit.” The answer was announced at the end of December. Here’s a recap…

To start with the basics, the Federal government sets minimum wage. Since New York sets a higher minimum wage, it takes precedence. In New York, the minimum wage increased/is increasing effective January 1, 2024, 2025, and 2026. At the same time, the hospitality industry will experience increases in tip credits.

Hospitality employers can meet the required minimum wage through a combination of cash wages and a tip credit, which is a credit or allowance for tips employees receive from customers. The amount of the cash wage and tip credit varies by region and job classification.

Effective January 1, 2024 through December 31, 2024:

For service employees (i.e., employees who don’t serve food or beverages but typically receive tips like a bathroom attendant):

In NYC, Long Island, and Westchester County, the cash wage is $13.35 and the tip credit is $2.65.
In the remainder of New York State, the cash wage is $12.50 and the tip credit is $2.50.

For food service workers (i.e., employees who serve food or beverages and typically receive tips, like a waiter or bartender):

In NYC, Long Island, and Westchester County, the cash wage is $10.65 and the tip credit is $5.35.
In the remainder of New York State, the cash wage is $10 and the tip credit is $5.

However, hospitality employers cannot take the tip credit on days when a tipped worker spends more than 2 hours or 20% of a shift doing non-tip work and on weeks when service employees’ tips are lower than:

In resort hotels:

In NYC, Long Island and Westchester County: $8.95.
In the remainder of New York State: $8.40.

In restaurants and all-year hotels:

In NYC, Long Island and Westchester County: $3.45.
In the remainder of New York State: $3.20.

So, we enter 2024 with a New York tip credit intact, continuing the several-years-long debate on whether to eliminate sub-minimum wage for tipped workers. We’ll keep you updated as we learn more.

While your employment or labor attorney is the best person to contact with questions about wages, when it comes to accounting, tax, audit, or business advisory needs, RBT CPAs is here for you. Please don’t hesitate to give us a call.

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.

Mark Your Calendar! Submit Final Health Care and Mental Health Worker Bonus Program Claims April 1 to May 1

Certain healthcare employees who work consecutively between October 1, 2023 and March 31, 2024 may be eligible for a New York Health Care Worker Bonus of $500, $1,000 or $1,500. Between April 1 and May 1, eligible employers can submit a claim for all eligible employees.

In 2022, New York Governor Hochul launched the Health Care and Mental Hygiene Worker Bonus program to support eligible employers’ efforts to recruit, retain, and reward staff, and ultimately increase the state’s healthcare workforce by 20% in five years. Four vesting periods have been completed and bonuses paid; this is the final bonus payable under the program.

Who’s an eligible employer?

As noted in the program’s FAQs as of July 27, 2023, you must have at least one employee; bill for services under the Medicaid state plan or a home or community-based services (HCBS) waiver; have a provider agreement to bill for Medicaid services arranged through a managed care organization or a managed long term care plan; or be an eligible education institution or other eligible program.

Eligible employers include “certain providers, facilities, pharmacies, and school-based health centers licensed under the state Public Health Law, Mental Hygiene Law, and Education Law, as well as certain programs funded by the Office of Mental Health (OMH), Office for the Aging, Office of Addiction Services and Supports (OASAS), and the Office for People with Developmental Disabilities (OPWDD).” This includes staff at hospitals and nursing homes; psychiatric centers; OASAS addiction treatment centers; residential programs operated or certified by OPWDD, OMH and OASAS; Medicaid assisted living programs; hospice residences; and more.

Who’s an eligible employee?

An employee must hold an eligible job providing patient-facing care. There is a long list of positions eligible – see job titles here. In general, to be eligible an employee must earn less than $125,000 annually; work consecutively for the employer during the six-month vesting period that began October 1, 2023 and ends March 31, 2024; and must not be excluded or suspended from Medicaid during the vesting period. The employee can be part-time, full-time, temporary or an independent contractor.

How much is the bonus worth?

Bonus amounts depend on the number of hours worked per week during the vesting period and can be in the amount of $500, $1,000, or $1,500. An employee can be eligible for up to two vesting periods and receive a maximum of $3,000 in bonuses. If the employee is a New York State resident, the bonus will not be subject to NY personal income taxes and any local income tax.

To take advantage of the program, an eligible employer must apply at www.nysworkerbonus.com between April 1 and May 1 for the final vesting period. You’ll need an active MMIS ID with eMedNY or a Statewide Financial System (SFS) ID. For complete program details, visit the NYS Department of Health website.

For information on tax implications, RBT CPAs professionals are available to help (we are also available to support your accounting, tax, and audit needs). To learn more, give us a call today.

RBT CPAs is proud to say all our work is prepared in the U.S.A. – we never offshore. As a result, you get peace of mind that your operation’s financial and confidential information is handled by full-time, local staff who have met our high standards for quality, ethics, and professionalism.

IMPORTANT NOTE! This article provides highlights of the Health Care Worker Bonus program. Complete program details are available at the NYS Department of Health website. If there is any discrepancy between the information in this article and the website, the website’s content governs.

Update on GASB Proposal: Disclosure and Classification of Certain Capital Assets

Last September, the Governmental Accounting Standards Board (GASB) issued a proposal to require certain types of capital assets be disclosed separately for purposes of note disclosures and certain assets to be classified as “held for sale.” Stakeholders have been reviewing the proposal and comments were accepted until January 5.

According to the Exposure Draft, Statement requirements would be effective fiscal years beginning after June 15, 2025 (although earlier application would be encouraged), with certain assets to be reported retroactively for periods covered by the basic financial statement.

State and local governments must provide details about capital assets in financial statement notes. Prompted by Statement 87 (Leases) and 96 (Subscription-Based Information Technology Arrangements) creating “right-to-use” assets, GASB began considering existing classifications’ effectiveness. The Board proposed certain types of assets be disclosed separately in capital assets note disclosures, including:

New! Capital assets held for sale, by major class of asset
Lease assets reported under Statement 87, by major class of underlying asset
Subscription assets reported under Statement 96, and
Intangible assets other than leases and subscriptions, by major class of assets.

The proposed new classification of “Capital assets held for sale” would be evaluated each reporting period and apply for assets the government has decided to sell if the sale would likely be finalized within one year of the financial statement date. Factors associated with the likelihood of sale include, but are not limited to:

Asset is available for immediate sale in current condition
An active program to locate a buyer has been initiated
Market conditions for that type of asset
Regulatory approvals to sell the asset

If requirements cannot be applied retroactively to all periods in a basic financial statement, a reason must be given. Changes adopted related to “capital assets held for sale” should be reported as a reclassification resulting from an accounting principle change.

Overall, proposed updates would make reporting across government entities more consistent and comparable, and the additional information would better inform decision-making and assess accountability.

We will keep you updated as more information becomes available. In the meantime, please know RBT CPAs are here to support your municipality’s accounting, tax, audit, and advisory needs. Give us a call to learn more.

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.

Navigating the Maturing $400 Billion Loan Wave: A Guide for Commercial Real Estate Owners

The commercial real estate sector is approaching a critical juncture with approximately $400 billion in loans set to mature. This situation is further intensified by the persistence of high interest rates. As a commercial real estate owner, it is crucial to anticipate what’s next and take proactive steps to manage risks and leverage opportunities. Consider the following…

Determine how the maturation of loans will impact your financial status and plans. Depending on the terms of your loan, you may need to pay a significant amount when the loan matures. Discuss with your banker about your repayment options and any potential for refinancing.
Anticipate what is going to happen with interest rates. High rates may increase your repayments, leading to financial strain. Your banker should provide clarity on current rates, the bank’s forecast on how they might change, and how these changes could impact your loan repayment schedule.
In a high-interest environment, paying off a loan early can save considerable money. However, some loans come with prepayment penalties, making early repayment less beneficial. Ask your banker about the possibility of these penalties and consider this in your financial planning.
Explore refinancing. With impending loan maturities, it is prudent to lock in a new loan at a favorable rate before interest rates climb any higher. Refinancing can provide the much-needed capital for property improvements, debt consolidation, or to fund new investments. However, it is essential to conduct a thorough analysis of the potential savings against the costs of refinancing to determine the feasibility.
It’s an opportune time to review your property portfolio. Consider selling non-core assets and investing in properties with higher yields. While selling can be a tough decision, especially in a high-interest rate environment, the liquidity provided can help reduce the risk of default on maturing loans. It also allows you to reallocate resources to more profitable ventures.
Consider deleveraging. When interest rates are high, it becomes costly to service debt. Reducing the debt in your portfolio can increase your equity, making your investment less risky. It’s crucial to weigh the benefits of deleveraging against the potential returns from maintaining a higher debt level.
Building relationships with multiple lenders can provide additional financing options. Diversifying your lending relationships can provide flexibility in negotiating terms and may enhance your ability to secure financing at favorable rates.
Focus on improving property performance. High occupancy rates and rental income can increase the value of your property and its attractiveness to lenders. Investment in property improvements can attract quality tenants, ensuring a reliable income stream.

The maturing of $400 billion in loans amidst a high-interest rate environment presents both challenges and opportunities for commercial real estate owners. Timely refinancing, portfolio review, deleveraging, diversifying lending relationships, and enhancing property performance are strategic moves that can help navigate this landscape.

Remember, every financial decision has its risks and rewards. It is advisable to seek professional advice before making significant financial decisions. Proper planning and strategic action can help ensure the sustainability of your commercial real estate portfolio amidst these market conditions.

Should you have any questions, please don’t hesitate to contact your RBT CPAs client manager. Our experts are also available to help with your accounting, audit, tax, and business advisory needs throughout the year. Give us a call to learn more.

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.

Understanding What Internal Financial Controls Can Do For Your Business

The RBT CPAs Advisory Services team receives a lot of inquiries about internal financial controls, especially as a growing number of our manufacturing clients explore and implement Enterprise Resource Planning (ERP) systems. So, we figured we’d do an article on the topic. Take a look as financial controls can help any business – whether it’s adopting an ERP or not – protect its assets, promote transparency, provide data to make business decisions, and instill stakeholder and investor trust.

Starting with the basics…The Sarbanes-Oxley Act (SOX), enacted in 2002, was a regulatory response to major corporate and accounting scandals. SOX Section 404 mandates publicly traded companies in the U.S. establish, document, test, and maintain internal controls and procedures for financial reporting. Among other things, these companies must produce an annual report where management asserts the effectiveness of internal controls.

Private companies looking to go public must be SOX-compliant before an initial public offering. Although not mandatory, many nonprofits voluntarily adopt SOX provisions as best practices. New York State law requires state agencies and public authorities to maintain a system of internal controls to help safeguard public assets and promote accountability in government.

Internal financial controls are processes designed to help prevent fraud, enhance reliability of financial statements, reduce the risk of unexpected financial losses, and ensure compliance with laws and regulations. They include procedures for authorization, record keeping, reconciliations, and auditing. They also contribute to effective management by providing reliable data for decision-making.

Although a business can consider adopting financial controls at any time, they are particularly important as part of ERP implementations. ERP systems eliminate data silos, reducing the risk of errors and fraud while promoting financial integrity and transparency. ERPs enable real-time tracking of financial transactions. So, instead of waiting for end-of-period financial reports, managers can proactively monitor financial processes, promptly detecting and addressing any anomalies. What’s more, by automating routine tasks, ERP systems minimize manual intervention, reducing the risk of errors and freeing up time for more strategic activities. Based on our advisory services teams’ experiences with ERP implementations, the one non-negotiable recommendation we would make is to define internal financial controls as part of the up-front planning process. Trying to develop these controls concurrent with ERP implementation or after the fact can lead to higher implementation costs, longer project timelines, and extended business disruption.

If your business is going to take the time and expense to implement an ERP, defining financial controls upfront is critical to maximizing your return on investment. Even if your business isn’t currently considering an ERP, internal financial controls can provide added protection for your business, while increasing trust among stakeholders, including financial institutions, investors, and lenders.

Interested in learning more? For business advice, accounting, audit, and tax services, RBT CPAs professionals are always available. Give us a call.

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.

Safeguarding Your Veterinary Practice: Tips to Counter Cyber Threats

While digital technology has brought about significant service and operational improvements in veterinary practices, it has also resulted in a growing number of cyberattacks and threats. Breaches can result in everything from all your data being eliminated to confidential financial information about pet owners being released into the dark web. It can disrupt business, discredit your practice, and hurt your reputation not to mention finances. What can you and your team do to reduce the risk of a cyberattack?

1. Regularly update software.

Obsolete software often contains vulnerabilities that hackers can exploit. Ensure that all software, including your practice management system, antivirus software, and operating system, are always updated to the latest versions. Regular updates not only provide new features but also fix security bugs.

2. Train employees.

One of the biggest threats to cybersecurity is human error. All employees should be aware of potential cyber threats and how to avoid them. Conduct regular training sessions to educate employees on safe online habits, phishing scams, and the importance of strong passwords. (At the end of this article, you’ll find links to free cybersecurity resources, including training. Read on…)

3. Adopt strong password policies.

Weak passwords are one of the most common causes of data breaches. Encourage employees to use complex passwords and change them regularly. Implementing multifactor authentication can also add an extra layer of security.

4. Secure your Wi-Fi network.

Unsecured Wi-Fi networks are an open invitation for hackers. Ensure your practice’s Wi-Fi network is encrypted, hidden, and password protected. Also, consider setting up a separate network for clients to prevent unauthorized access to the practice’s main network.

5. Backup your data.

Regular data backups can save your practice in case of a ransomware attack. Ensure that all important data, including patient records and financial information, is backed up regularly in secure external storage or cloud-based systems.

6. Invest in cyber insurance.

While preventive measures are crucial, having a safety net in the form of cyber insurance can mitigate financial losses in the event of a cyber-attack. Cyber insurance can cover costs related to data recovery, customer notification, and potential legal liabilities.

7. Have an incident response plan.

In the unfortunate event of a breach, a well-documented response plan can limit damage, and reduce recovery time and costs. This plan should outline how to isolate affected systems, who to notify, steps to recover lost data, and how to analyze the breach to prevent future incidents.

More information and free resources – including training – to support and build your cybersecurity plans are available through CISA (the U.S. Cybersecurity and Infrastructure Security Agency). In addition, CISA created StopRansomware.gov, with free resources for organizations of any size to protect themselves from becoming a victim of ransomware and knowing what to do before, during, and after an attack.

Cybersecurity should be a top priority for every veterinary practice. By implementing robust security measures and fostering a culture of cyber awareness, you can shield your practice and clients from potential threats.

To free you up to focus on important aspects of your business, like cybersecurity, please know RBT CPA professionals are available to handle your accounting, tax, audit, and business advisory needs. Give us a call to learn more.

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.

Does Your District’s Cell Phone Policy Go Far Enough?

It is estimated that 80% of school districts in the U.S. have some type of cell phone policy. Is yours going far enough?

We enter 2024 with hundreds of lawsuits filed on behalf of children and school districts against social media behemoths for purportedly fostering addiction among young users of their platforms. Over 40 states are also pursuing lawsuits, as numerous studies have linked social media to a staggering growth in mental health issues among America’s youth, including anxiety, depression, suicide, self-harm, low self-esteem, and more.

In fact, U.S. Surgeon General Dr. Vivek Murthy issued an advisory in 2023 to draw attention to social media’s impact on our youth. According to the advisory, up to 95% of youth ages 13 to 17 say they use social media, with 30% indicating use is almost constant. About 40% of youth ages 8 to 12 are using social media (even though 13 is the minimum age for use). What isn’t known is whether this is safe for young users, considering the lack of information about its impact on brain development.

The advisory goes onto acknowledge there are pros and cons to social media for young users. On the plus side, it can help foster community and connections, allow self-expression, and provide a gateway to information. On the negative side, depending on daily usage, studies show it can significantly increase signs of depression and anxiety, lower self-esteem, increase bullying and peer pressure, contribute to attention deficits, and more. It also dramatically increases exposure to potentially harmful content.

The advisory says charting a path forward will require effort on the part of policymakers, technology companies, parents and caregivers, researchers, and today’s youth, but time is of the essence as the impact of social media on youth is occurring right now.

As the U.S. grapples with the issue, France, Italy, Portugal, Finland, and China already ban cell phones at school. More recently, England adopted guidance supporting a ban in schools, leaving the door open to legislation making the guidance statutory in the future. The ban applies to both class and break times, with a goal of improving focus, decreasing disruptive behavior and bullying, and removing distractions.

With litigation playing out in the U.S. and potential legislation seemingly on the distant horizon, the majority of school administrators and education professionals are taking the reigns to advocate for policies managing or limiting cell phone use at school.

A spectrum of approaches is being used. Some districts have policies negating the use of cell phones during class time or throughout the entire school day. Some give individual teachers the authority to determine cellphone use in their class. Some have centralized storage for cell phones or designated areas where use is allowed. Still, consistent enforcement has been a challenge.

A growing number of schools are turning to buying patented phone pouches, produced by a company called Yondr, that are locked at the start of the school day and unlocked when school is over, with seemingly positive feedback from educators, parents, and students alike. A survey of over 900 school partners that adopted these pouches revealed 65% saw improved academic performance, 74% saw improved student behavior, and 83% saw improved student engagement in the classroom.

As you and your team work with parents, students, educators, healthcare professionals, and legal council to determine a path forward for managing cell phone use during school hours, you can count on RBT CPAs for all of your accounting, audit, tax, and advisory needs. Give us a call to learn more.

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.

Please note: This article is for informational purposes only and should not be construed as advice. As always, it’s in your best interest to work with your district’s legal advisor when contemplating new policies and procedures.

Are You Ready to E-file Benefit Information Returns?

Starting January 1 of this year, e-filing requirements under the Taxpayer First Act take effect. Now, employers that file 10 or more returns in total during a calendar year must do so electronically. This includes Affordable Care Act (ACA) filings. Failing to comply can result in significant financial penalties.

Under the ACA, Applicable Large Employers (ALEs) must report whether they offered affordable, minimum essential coverage to full-time employees. All employers that sponsor self-insured plans must also report months of coverage for enrolled individuals. IRS Forms 1094-C and 1095-C are used to file this information with the IRS; they must also be provided to employees.

Before 2024, employers filing less than 250 returns for Form 1094-C and 1095-C had an option: file via paper or electronically. The 250-threshold applied to each type of return filed. Now, if the aggregate number of returns for all required filings (including W-2s and 1099s plus others) are 10 or greater, electronic filing is the only option.

As noted on the IRS website, “T.D. 9972 affects filers of partnership returns, corporate income tax returns, unrelated business income tax returns, withholding tax returns, certain information returns, registration statements, disclosure statements, notifications, actuarial reports and certain excise tax returns.”

Different filings must be submitted via the appropriate system. For example, ACA documents will be filed via the Affordable Care Act Information Returns or AIR system, while Form 1099s can be filed for free via the Information Returns Intake System (IRIS). Other returns will be filed via Filing Information Returns Electronically or FIRE system.

You need a separate Transmitter Control Code (TCC) for each system, and it can take some time to receive your code. So, if you don’t already have your TCCs, now is the time to apply.

AIR System — Affordable Care Act (ACA) Information Returns Application for TCC
FIRE System — Information Returns (IR) Application for TCC
IRIS System — Information Returns Intake System (IRIS) Application for TCC

For 2024, the e-filing deadline for Forms 1095-C and 1094-C is April 1 (since March 31 is a Sunday). Different reporting requirements and deadlines may apply in certain states (i.e., California, District of Columbia, Massachusetts, New Jersey, and Rhode Island).

For more information on e-filing regulations, including hardship appeals, click here. Then, make sure you have the appropriate processes and resources lined up to comply with electronic filing requirements.

Should you have any questions, please don’t hesitate to contact your RBT CPAs client manager. Our experts are also available to help with all of your accounting, audit, tax and business advisory needs throughout the year. Give us a call to learn more.

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.

New York’s Weatherization Assistance Program Helps Lower Energy Costs

While the winter months in New York can be particularly tough for low-income households, there’s a special program to help lower energy costs, reduce energy use, and boost a healthy and safe environment.

It’s called the Weatherization Assistance Program (WAP).

WAP provides assistance to low-income households, based on thresholds announced in November of 2023. It is available to homeowners, renters, and rental property owners (of houses or apartment buildings), with priority given to seniors, people with disabilities, and families with children.

A household with a member receiving Home Energy Assistance Program (HEAP) or other public assistance benefits is automatically eligible for WAP. Homeowners, affordable housing developers, property managers, and other housing and community development agencies may also be eligible.

To apply, contact a WAP service provider for your area. You’ll submit an application and the provider will determine your eligibility. If approved to participate, the provider’s own crew or subcontractors perform the work.

The program kicks off with an on-site energy audit which helps evaluate a home for services. Approved services are performed and quality assured with a follow-up inspection.

Example of services that may be performed include attic and wall insulation; repair or replacement of heating system; efficient lighting and refrigeration; crack and hole sealing; window and/or outside door replacement or repair; minor repairs to maximize weatherization services; and services to mitigate health and safety issues related to heating and cooling.

There is no cost for services to the home’s occupant. Property owners help cover any costs. For more details about WAP, click here. For a list of WAP providers by county, click here.

While you focus on keeping tenants warm and safe this winter, please remember RBT CPAs is here to help with all of your accounting, tax, audit, and advisory needs. Give us a call today.

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.

Why Estate Planning Should Take Center Stage in 2024/2025

You’ve worked hard to build your wealth. Protect it by resolving to make gift and estate tax planning a priority in the New Year.

This is especially important in 2024 and 2025 since, without legislative action, the valuable Tax Cuts and Jobs Act’s (TCJA’s) gift and estate tax exemption is set to revert to pre-2018 levels starting in 2026, significantly increasing the amount of an estate subject to Federal taxes. Add to that New York’s estate tax rules and planning becomes paramount.

When the TCJA took effect on January 1, 2018, certain provisions increased the amount of assets individuals and married couples may gift annually and over a lifetime (as well as leave as part of an estate), with no federal taxes owed. Each year, exemption amounts are adjusted for inflation. For 2024:

The annual gift exclusion limit is $18,000 (or $36,000 for a married couple) per person. You do not have to pay taxes on gifts up to the limit. Also, amounts up to the annual limit do not count toward the gift and estate tax lifetime exemption. So, let’s say you are married and have two children. You and your spouse may each gift $18,000 to each child, for a total combined gift of $36,000/child in 2024. You won’t have to pay taxes on the gift and the gift won’t apply toward your lifetime gift and estate tax exemption. (There is an exception: if you are married and your spouse is a U.S. citizen, you can gift an unlimited amount to your spouse tax-free. If your spouse is not a U.S. citizen, there is an annually adjusted limit on tax-free gifts. For 2024, that amount is $185,000.) To qualify for the annual gift exclusion, the gift must be a present interest gift.
The gift and estate tax lifetime exemption is $13.61 million (or $27.22 million/married couple). Amounts above the lifetime exemption are taxable. Even though the exemption is scheduled to decrease starting January 1, 2026, any exemptions for 2018 through 2025 will be honored at the higher exemption amounts in effect at the time. The Federal tax law has a portability provision that provides for the unused exemption of the first spouse to die to be available to the surviving spouse if an estate tax return is filed when the first spouse passes away and the surviving spouse is a U.S. citizen.

Both the annual limit and lifetime exemption will be adjusted for inflation again at the start of 2025. Then, on January 1, 2026, the gift and estate lifetime exemption goes back to its pre-2018 level of $5 million, adjusted for inflation (so it’s expected to be in the $7 million to $8 million range). This will significantly reduce the amount of assets that can be gifted over a lifetime and passed on as part of an estate tax-free. In New York, it’s a bit more complicated.

New York does not have a gift tax; however, it does have different rules for estate taxes. Key differences include:

An estate tax exclusion is tied to federal tax laws from 2014 and gradually indexed for inflation. For 2024, the New York estate tax exclusion amount is $6,940,000.
However, there is a “cliff” built into the calculation. If a decedent’s taxable estate is between 100% and 105% of the exclusion amount as of the date of death, exclusion benefits phase out. There is no exclusion benefit if a taxable estate is more than 105% of the exclusion amount as of the date of death. This means New York State estate taxes are due starting with the first dollar of assets.
Gifts made within three years of death are not excluded and are “clawed back” to be included in the calculation of New York estate taxes.
New York does not have a portability provision and, thus, does not allow an unused exclusion amount to transfer to a surviving spouse.

There are actions New Yorkers can take to stay within the state’s exclusion amount while avoiding the “cliff” and maximize opportunities under Federal estate tax laws. If you’re interested in learning about your options, contact RBT CPA Trust, Estate and Gift Practice professionals by emailing Ita Rahilly, CPA, at irahilly@rbtcpas.com. Your RBT CPA client manager is also available to help start the discussion, in addition to handling your accounting, tax, audit, and business advisory needs. Give us a call today.

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.