LLC Update

If you have not read about the LLC tax proposal you might want to scroll down to the blog on June 26th. If, however, you have read the LLC installation, I received an update from Rick Zechini, Director of Government Affairs for NCAR, yesterday.

There's good news and bad news in regards to the LLC tax. We'll take care of the bad news first. Governor Bev Perdue recently released her ideas on a tax package. It seems the tax on LLCs is included and appears to be the same version of what appeared in the House's version. The Governors proposal is in an N&O story that also has the link to her actual proposal. Check out http://projects.newsobserver.com/under_the_dome/perdue_wants_1_cent_sales_tax_hike. So I guess the bad news is this LLC thing is in the House budget, the Senate finance package and now the Governor's tax package.

Okay here is the "good" news. Senator Clodfelter wants to elimanate the 55% of the appraised value part of a three part franchise tax evaluation. If you will recall the original LLC tax provision would require the payment of taxes at a rate of $1.50 for every $1000 of value of the greatest of the following: 1.) the apportioned capital base of the business entity; 2.) 55% of the appraised value of tangible real and personal property in North Carolina or 3.) the total actual investment in tangible property in the state. (phew!) Apparently, by eliminating that 55% appraised value piece it would "dramatically reduce" the impact of this new tax. Rick Zechini (rzechini@ncrealtors.org) would love your opinion on that one, so feel free to shoot an email in his direction.

Again, NCAR is working with a wide group of people and NAIOP has recently acquired a lobbyist that Rick has touched base with on this issue. If you feel strongly enough about this issue, I would suggest you contact Rick and see what you can do to influence how this will turn out.