This tax season McGuire Sponsel would like to remind our alliance partners and clients of additional tax saving ideas to consider. The goal of our firm is to work strategically with CPAs and their clients to implement specialty tax and consulting services that fall outside of “traditional” planning options.
For example, exporters who have never formed an IC-DISC can gain a greater benefit the earlier in the year an IC-DISC is formed. IC-DISC commissions are based on sales on or after the day of the incorporation of the IC-DISC. The prospective nature of the IC-DISC makes it critical to not delay the organization of new IC-DISCs.
In 2015, McGuire Sponsel identified an opportunity for a chemical manufacturer that had approximately $98 million in annual revenue and $23 million in international sales. The client had a $1 million commission paid to the IC-DISC to reduce their taxable income. Since the client set up the IC-DISC in the beginning of the year, nearly $170,000 in federal income tax was saved in the IC-DISC’s initial year.
This opportunity is available to any U.S.-based company that exports goods they manufacture, produce, grow or extract. Companies who provide architectural or engineering services for products or infrastructure built outside the U.S. can also qualify. It is also important to note that qualified exports can include manufactured goods exported directly or indirectly – meaning attached to another U.S.-based company’s final product.
Contact McGuire Sponsel today to discuss how our IC-DISC team can help maximize IC-DISC benefits for your clients.