Monthly Archives: January 2016

Applicable Federal Rates for February 2016

The Internal Revenue Code prescribes minimum imputed interest rates and time-value-of-money factors applicable to certain loan transactions and estate planning techniques. These rates are tied formulaically to market interest rates. The Internal Revenue Service updates these rates monthly.

These are commonly applicable rates in effect for February 2016:

Short Term AFR (Loans with Terms <= 3 Years)                                          0.81%

Mid Term AFR (Loans with Terms > 3 Years and <= 9 Years)                     1.82%

Long Term AFR (Loans with Terms >9 Years)                                              2.62%

7520 Rate (Used in many estate planning vehicles)                                     2.2%

Here is a link to the complete list of rates:

E. John Wagner, II

Ruling Clarifies Rules Regarding Equestrian Supplies and Sales Tax

The Florida Department of Revenue recently issued a Technical Assistance Advisement (“TAA”) clarifying the applicability of sales tax to certain equestrian supplies. The TAA explains that the sale of veterinary drugs, substances, or preparations that are required by federal or state law to be dispensed only by prescription are exempt from sales tax under the general prescription medicine exemption. Non-prescription substances or preparations are taxable. Feed for livestock, which includes all animals of the equine class (including racehorses), is also exempt from sales tax. Exempt feed includes equine joint supplements. Sales of equine insect and fly repellant are exempt as sales of pesticides used directly on livestock. Finally, sales of insect or fly masks and fly sheets are taxable.

A link to the ruling is here: Michael J. Wilson 941-536-2043

Going Global: What Are the International Tax Issues for a Small or Mid-Size Company

From a legal perspective, global expansion can have many forms, structures, and functions, including creating contractual relationships with distributors or licensees; establishing international legal entities for sales, manufacturing, or other business functions; or entering into an international joint venture. Regardless of the form or size of the contemplated global business expansion, there are a host of complex tax issues that have to be wrestled with in addition to the plethora of business and regulatory issues. Mike Wilson recently authored an article on this topic, which can be found here:

Michael J. Wilson