Category Archives: Blog

Regier Carr & Monroe (RCM Tulsa)  Expands Its Tax  & Audit Team

March 9, 2018

               TULSA, OK. (March 01, 2018) – Regier Carr & Monroe (RCM Tulsa) announces the promotion of two tax and accounting professionals that will work out of the Tulsa office.

RCM has elevated Kenneth L. Thompson, CPA to partner. Ken joined the Firm in January 2017 coming from his practice in Oklahoma City that specialized in entrepreneur small businesses, restaurants, real estate development, commercial real estate and residential construction. He also had a sizeable part of his practice devoted to running a “family office” for a high net worth family. Ken’s primary client focus has been high net worth family’s and entrepreneurs that desire to become high net worth individuals. His focus on driving family wealth for his clients stems from his BBA in Finance from the University of Oklahoma. Ken likes to say he is a “CPA” by accident and not by design. As finance is focused on the future while accounting assesses the past, this different perspective is what Ken provides to the RCM client base. Ken brings over twenty-four years of public accounting experience to the Firm in the practice areas of financial auditing, tax compliance and business process consulting. He is a member of the American Institute of Certified Public Accountants, the Oklahoma Society of Certified Public Accountants and Tulsa Estate Planning Forum. Ken has donated considerable time to two charitable organizations in the Oklahoma City area, but now is looking for new opportunities for community service the Tulsa area.

RCM has elevated C. Michael Humphrey, CPA to partner. Michael has been with the firm since July of 2012. Michael received a Bachelor of Science in Business Administration from Oklahoma State University, with a major in accounting. He began his public accounting career as in income tax preparer in Oklahoma City and became a company controller two years later. Michael then served as an audit manager for the Oklahoma State Auditor and Inspector for five years when he gained experience auditing state and county governments. Michael’s audit and accounting experience includes, Not-for-profit entities, business enterprises in the following industries: financial institutions, mortgage companies, engineering, energy and production, manufacturing, construction, wholesale, retail, and Governmental Entities such as: state and county government and Native American tribes, gaming and housing.

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ACA Employer Mandate IRS Penalties Are Here

February 27, 2018

After several years of Affordable Care Act (ACA) penalty inertia, the IRS has begun issuing employer mandate penalties.  Employers that were noncompliant for the 2015 Form 1095/1094 reporting year recently received Letter 226-J penalty notices. This is no surprise, as the IRS had updated its FAQs to state that “non-complying Applicable Large Employers should expect to receive penalty letters by late 2017.”

To illustrate the magnitude of the penalties, here are two examples.

Case #1 — Manufacturer with 65 employees

  • Penalty amount: $75,000.
  • Triggered by five employees receiving a Premium Tax Credit when they purchased health insurance on the Exchange.

Case #2 — Staffing Company with 1,000 employees

  • Penalty amount: $340,000.
  • Triggered by one “rogue” employee receiving a Premium Tax Credit when he purchased health insurance on the Exchange. The employer was penalized — even though the employee waived employer coverage and was technically ineligible for a Premium Tax Credit. The employer is challenging the penalty, but unfortunately it did not secure a signed waiver.

We understand that the IRS has issued almost 100,000 penalty letters and that some of the penalties are for millions of dollars.

To compound the issue, industry commentators expect a second wave of 2015 Letter 226-J penalty notices as well as penalty notices for calendar years 2016 and 2017. In spite of improved reporting technology, employers continue to have data and reporting struggles, primarily due to “bad data” and lack of ACA technical knowledge.


Now is the time for employers to consider a self-audit, which should include recalculating health insurance eligibility as well as line 14 Offer of Coverage and line 16 Employee Status code accuracy. It’s also a good time to start proactively organizing the documents that may be needed to prepare a response or appeal to the IRS.

While “at-risk” employers should be concerned, there’s another contingent of non-filing employers that should be relieved. These are employers that neither 1) furnished 1095-C forms to eligible or enrolled employees,  nor 2) submitted their 1094-C transmittal to the IRS.


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Do You Know the Tax Impact of Your Collectibles?

February 19, 2018

One person’s trash is another person’s treasure. That’s never truer than when dealing with collectibles — those seemingly innocuous objects for which many people will pay good money. In fact, many collectibles are more sought after, and more valuable, than ever. But that value comes with tax consequences when you sell collectibles at a profit, donate them to charity or transfer them to the next generation.


The IRS views most collectibles, other than those held for sale by dealers, as capital assets. As a result, any gain on the sale of a collectible that you’ve had for more than one year generally is treated as a long-term capital gain.

But while long-term capital gains on most types of assets are taxed at either 15% or 20% (or 0% for taxpayers in the 10% or 15% ordinary-income tax bracket), capital gains on collectibles are taxed at 28% (or your ordinary-income rate, if lower). As with other short-term capital gains, the tax rate when you sell a collectible that you’ve held for one year or less typically will be your ordinary-income tax rate.

Determining the gain on a sale requires first determining your “basis” — generally, your cost to acquire the collectible. If you purchased it, your basis is the amount you paid for the item, including any brokers’ fees.

If you inherited the collectible, your basis is its fair market value at the time you inherited it. The fair market value can be determined in several ways, such as by an appraisal or through an analysis of the prices obtained in sales of similar items at about the same time.


If you want to donate a collectible, your tax deduction will likely depend both on its value and on the way in which the item will be used by the qualified charitable organization receiving it.

For you to deduct the fair market value of the collectible, the donation must meet what’s known as the “related use” test. That is, the charity’s use of the donated item must be related to its mission. This probably would be the case if, for instance, you donated a collection of political memorabilia to a history museum that then puts it on display.

Conversely, if you donated the collection to a hospital, and it sold the collection, the donation likely wouldn’t meet the related-use test. Instead, your deduction typically would be limited to your basis.

There are a number of other rules that come into play when making donations of collectibles. For instance, the IRS generally requires a qualified appraisal if a deduction for donated property tops $5,000. In addition, you’ll need to attach Form 8283, “Noncash Charitable Contributions,” to your tax return. With larger deductions, additional documentation often is required.

Estate Planning

Transfers of collectibles to family members or other loved ones, whether during life (gifts) or at death (bequests), may be subject to gift or estate tax if your estate is large enough. And you may be required to substantiate the value of the collectible.

For estate tax purposes, if an item, or a collection of similar items, is worth more than $3,000, a written appraisal by a qualified appraiser must accompany the estate tax return. Gifts or bequests of art valued at $50,000 or more will, upon audit, be referred to the IRS Art Advisory Panel.

Even if your estate isn’t large enough for gift and estate taxes to be a concern (or the federal gift and estate taxes are repealed, as has been proposed), it’s important to include all of your collectibles in your estate plan. Even an item with little monetary value may have strong sentimental value. Failing to provide for the disposition of collectibles can lead to hurt feelings, arguments among family members or even litigation.

Proper Handling

Collecting can be addictive. But the tax implications are difficult to sort out. We can help you determine how to properly handle these transactions.

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