If you’ve ever been on a Zoom call with me, you might have seen my favorite coffee mug—white with a host of plants and the saying, “No Such Thing As Too Many.” And typically, right behind me, you’d see several pots on my ledges and bureaus. It’s true: I’m a plant person.
If you’re a fellow plant person, you understand what it’s like to move plants from one pot to the next and try them in different locations. It’s sort of like a puzzle, and your mission is to figure out what works best. And over time, you figure out what works and what doesn’t. For example, I’m great at growing perennials like peace lilies and pileas, but not so great with succulents. I generally have a bumper crop of herbs, but I’ve yet to see a squash or an eggplant hit full size.
I decided to try my hand with fruit trees a few years ago. I’m in Pennsylvania, which does freeze at night in the winter, so I opted for patio trees—those that you can bring in during the cold season. My trees of choice? Lemon and olive.
The olive tree wasn’t a fan of the mix of Pennsylvania summers and winters and eventually died off. The lemon tree survived and, last year, produced fruit. Singular. It was a small, green fruit that gave me pause: Did I actually order a lime tree instead? I picked it. It remained hard and green. Incredibly disappointing.
This year, four fruits appeared on the tree in summer. They were all green. I was determined to get something edible, so I did a little research. According to the University of Florida, depending on conditions, it can take four to 12 months from flowering to fruit harvest. And as my conditions aren’t quite as tropical as those in Florida, I assumed I would be on the longer end of that scale. I was right. We’re entering the second week of November, and the lemons are finally turning yellowish. I’ve been obsessively checking them every day. I am hoping for lemons by Thanksgiving—while there aren’t enough to make lemonade, they can certainly produce some nice lemon wheels for martinis.
The time it takes to produce a few lemons has made me think about grocery store fruit differently. It’s taken a few years for my tree to get going—and then several months for the fruit to ripen. I’ve been monitoring water and temperature, turning it to make sure that it’s got just enough sun, and protecting it from winds during storms. And yet, I could buy more lemons than those on my tree right now for a single dollar at the grocery store.
We’re so used to the idea that value is reflected in the price that it’s easy to forget about the steps and time in between. The same is true in tax and the law. Whether you value bill or rely on the billable hour, the price that a client is paying is rarely a direct reflection of just that matter. The price—and the value—is a reflection of all that you’re bringing to the table. The client isn’t paying for a single return or an appellate document any more than you’re really paying for a single lemon at the store. It’s a culmination of your education, your work, and your processes. And the more care and attention you pay to those things, the more valuable you can be.
I love the idea that if you cultivate something—whether it’s a lemon or a skill—you can get better at it. And then you can produce something pretty remarkable.
At Bloomberg Tax, we aim to make it easy for you to keep working at getting better at what you do. Our experts offer great commentary and insightful analysis on federal, state, and international tax issues to keep you informed—giving you back time to enjoy the fruits of your hard work.
The Exchange… It’s where great ideas intersect.
—Kelly Phillips Erb
Correction
Switching between several time zones during daylight saving time can do a number on you. Last week, while traveling, I misstated in the newsletter that Switzerland and Liechtenstein were EU countries when I meant to say Schengen countries. It’s been corrected—and I apologize for the error.
Quick Trivia
As a result of the Tax Reform Act of 1986, Treasury was required to establish an office to study the depreciation of all depreciable assets, and when appropriate, to assign or modify the existing class lives of assets. The report that focused on the depreciation of fruit and nut trees determined that lemon trees had a useful life of 22 years. Only three trees in the study had a shorter useful life. What were they? Hint: All three begin with the letter “P.”
Answer at the bottom.
State Insights
Philip Olsen of Davis Malm summarizes recent tax developments in Massachusetts, including exemption eligibility for solar power facilities, disregarded entities, and outdoor advertising structures, plus a real estate tax assessment.
Partnerships, S corporations, and individuals should consider the benefits of a pass-through entity tax election. But everyone involved should understand that it’s a complicated computation, say Tony Israels, Jason Parish, and Ron Cook of Plante Moran.
Federal Insights
A 1% tax on corporate stock buybacks is a big first step in changing the basis for the corporate income tax from profits to returns to shareholders, says Dean Baker of the Center for Economic and Policy Research.
Failing to properly plan for disability, death, or the ultimate transition of a family business can lead to disastrous financial consequences for both the business and the family. Chamberlain Hrdlicka’s J. Scot Kirkpatrick, Stephen C. Heymann, and Jasmin N. Severino share some key estate planning strategies.
When it comes to the IRS, “audit” is one of those terms that seems like it should be accompanied by sinister organ music swelling behind it. ERC Provider’s Sunshine Chapman shares some ways to help abate clients’ stress.
Cryptocurrencies and non-fungible tokens are becoming a growing part of professional sports. Just like it was only a matter of time for the Chicago Cubs to win a World Series, it may only be a matter of time until digital assets make their way into everyday life, says Nik Fahrer of FORVIS.
Section 280 takes the profit out of the cannabis business by disallowing “deductions” and creating huge income tax liabilities. But if 280E tax debt isn’t also forgiven, the current cannabis industry won’t survive against newcomers, says Greenspoon Marder’s Nicholas J. Richards.
Global Insights
Officials from the IRS’ Advance Pricing and Mutual Agreement program recently completed a series of site visits in India. E. Miller Williams and Caroline Setliffe of Eversheds Sutherland provide an update, with the next step being a formal meeting to resolve more than 100 pending bilateral agreements.
Following the outcome of Brazil’s presidential election, there are three possible major paths for transfer pricing regulation to move forward, say Kroll’s Fabian Alfonso and Igor Scarano.
William Jean-Baptiste and Arthur Mendegris of Ogier Luxembourg consider the redesigned double tax treaty between Luxembourg and the UK, and discuss the most significant of the numerous changes the new treaty contains.
In the second of two articles on the technological improvements applied to customs authorities in Congo, Anthony Assassa and Elie Sawaya contend that these innovations must be accompanied by measures to ensure higher professional standards for customs and tax officials.
Parwin Dina of Global Tax Services looks at some of the most significant changes introduced in the amended United Arab Emirates law on value-added tax, and discusses what actions businesses need to take to respond effectively.
Anshu Khanna of Nangia Andersen LLP discusses the current environment for foreign direct investment in India and looks at regulatory considerations for potential investors.
Reader Responses
At The Exchange, we welcome responses from our readers and encourage diversity and civil discussion. We are especially interested in responses that add to the conversation, or introduce a different point of view. If you have a response to one of our published Insights, we’d love to hear from you.
A Closer Look
Nonfungible tokens hold intrinsic value due to their digital properties and traits. In this edition of “A Closer Look,” Stout’s Fotis Konstantinidis looks at the challenges of valuing NFTs, as well as the methods and data used for valuation.
Our Wish List
What’s on Bloomberg Tax Insights’ wish list right now? For November, we’d welcome thoughtful tax-related pieces focused on retail. We’re looking for articles that tackle the challenges of online or in-person sales in the post-Wayfair era—with a fresh twist, of course. We’d also welcome related pieces on sales tax audit and reporting challenges, as well as tax planning tips for companies with retail operations.
Our Insights articles—about 1,000 words—are written by tax professionals offering expert analysis on current tax practice and policy issues, tax trends and topics, and tax and accounting firm practice and management. If you have an interesting, never-published article for publication, we’d love to hear about it. You can contact our Insights team at TaxInsights@bloombergindustry.com.
Columnists
The US should follow Australia’s example by moving to public country-by-country reporting. The American people don’t need to wait on Congress—the SEC should mandate public CbCR reporting under its rule-making authority, our columnist Don Griswold writes.
Communication with clients is important, and keeping them informed is essential. But is it possible to have too much of a good thing? A recent ethics opinion from the American Bar Association suggests it might be—with caveats, I share in my latest column.
News
It’s been a busy week in tax news from state capitals to Washington. Here are some stories you might have missed from our Bloomberg Tax news team.
*Note: Your Bloomberg Tax login will be required to access Tax News.
- Energy companies that want to take advantage of bonus tax credits in President Joe Biden’s tax-and-climate law and avoid new labor rules are expediting their projects before the requirements go into effect.
- Stellantis NV’s Fiat won its challenge at the European Union’s top court to topple a €30 million ($30 million) tax bill imposed by the bloc’s antitrust regulators.
- A much-awaited rule proposal addressing taxpayers’ complaints about the Treasury Department’s foreign tax credit regulations should be issued within the next couple of weeks, an IRS official said.
- Practitioners and a key lawmaker have welcomed the addition of a new estate-tax item and cryptocurrency scope clarity to the IRS and Treasury’s annual priority guidance plan.
- California voters rejected measures that would have taxed millionaires to raise money for climate-related programs and legalized sports betting.
- The winner of the $2.04 billion Powerball jackpot could save themselves a potentially hefty tax bill because California is one of only a few states that doesn’t tax lottery winnings.
Career Moves
Jennifer Ridgway has joined Farrer & Co as a partner with the private client team, the law firm said.
Katherine Sharp has joined Mazars as a partner in the tax practice in the Dallas office, the firm said.
M. Sidney Donica has joined McCarter & English, LLP, as a partner with its tax and employee benefits and real estate practices in Newark, the law firm said.
Olivier Goldstein has joined King & Spalding LLP as a partner in the corporate, finance, and investments practice group in Paris, the firm said.
Justin L. Yarnell has joined Hahn Loeser & Parks as an associate in the business practice area in Columbus, Ohio, the law firm said.
Perkins Coie LLP has promoted 22 lawyers from of counsel to partner, including Bruce Pinegar, whose practice centers on trust and estate planning in Boise, Idaho, the firm announced.
If you are changing jobs or being promoted, let us know. You can email your submission to TaxMoves@bloombergindustry.com for consideration.
Quick Trivia Answer
Prune trees (20 years), plum trees (18), and peach trees (16) were found by Treasury to have shorter useful lives than lemon trees.
Our Team
We talk about tax a lot. But there’s a lot more that you might hear us talking about if you popped into one of our Teams meetings. Here’s a quick look at what some of us are watching, reading, and listening to this week:
Watching:
- Kelly Phillips Erb (Team Lead, Insights and Commentary, Bloomberg Tax): I just finished “Enola Holmes 2"—about Sherlock Holmes’ sister—with my kids. It was delightful. I think the first one was better, but the sequel was enough to keep me interested in a third.
- Melanie Cohen (Editor, Insights and Commentary, Bloomberg Tax): “Days of Our Lives”—after all, it’s on Monday through Friday!
Reading:
- Rebecca Baker (Editor at Large, Insights and Commentary, Bloomberg Tax): “Taste,” a memoir on food by Stanley Tucci.
- Andrew Leahey (Insights and Commentary, Bloomberg Tax): I just started “The Grandest Stage: A History of the World Series.” I’m in whatever stage of grief regarding the Yankees’ season it is where you start reading books about other seasons where it went better.
- Katherine Butler (Acquisitions Manager, International Tax, Bloomberg Tax): I just started “Scrublands” by Chris Hammer, I already read “Opal Country.” He’s an ex-journalist who writes crime set in harsh landscapes in the Australian outback, really atmospheric.
Listening:
- Rachael Daigle (News Director, Bloomberg Tax): The Head and the Heart—a Seattle band that I really wish I’d been more into when I lived in Boise, Idaho, and they were regulars in the coziest of venues.
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