Franchise Tax Board Gives Credit Where It’s Due

Since staring his consulting firm four years ago, Brady Bryan has worked with accounting firms to help companies throughout Southern California take advantage of a tax incentive programs. This year, Bryan has something new to offer: the California Competes tax credit, created to retain and attract businesses by alleviating the burden of money owed to the Franchise Tax Board. “For my business, I will be able to offer some value-added service to the current clients and to target new ones,” Bryan said. CalCompetes is administered by the Governor’s Office of Business and Economic Development, or GO-Biz. The state set aside $30 million in tax credits for the current fiscal year, 25 percent of which will go to small businesses. That amount increases to $150 million in the 2014-15 fiscal year, and to $200 million in the next two fiscal years. The tax credit agreements are negotiated by GO-Biz and the applicants, with final approval from a special committee. The credit businesses receive offsets back taxes owed the state. If the credit amount exceeds what is owed, the excess can be carried over for up to five years. The program is available to companies regardless of industry or location that are seriously considering leaving the state or those that want to move here. One of the factors in selecting companies to receive the credit is the strategic value the business brings to California, Brady said. “Certain (industry) clusters might have a better chance, but I don’t know,” Brady said. “Time will tell.” In his role as an advisor, Brady supports accounting firms and their business clients in learning about, qualifying and applying for tax incentives. For instance, Bryan Consulting does a lot of work with both state and federal research and development tax credits. Martini, Iosue & Akpovi, an accounting firm in Encino, has retained Brady’s firm about 25 times. Partner Steve Martini said he contacts Bryan to determine a general monetary range a client could receive from a tax credit program. Further investigation by Brady will bring in more detailed information that Martini then uses to make a final determination on whether to go after the credit. “Sometimes the credit might not be applicable even if they are eligible since they are not getting a tax benefit,” Martini said. CalCompetes is one of three new tax credit programs going into effect this year. The others are a hiring credit for specific low-income areas and a sales tax credit for manufacturing and biotech R&D equipment. These new programs were approved following the abolishment of the state’s enterprise zone incentive program. Big Dividends Members of Logix Federal Credit Union got a special bonus in late February with a loyalty dividend deposited directly into their accounts. The Burbank-based financial institution returned $4.21 million to 53,000 members with combined balances of $10,000 who had been with the credit union since June 2013. The dividend amount per member was $150. It is the second consecutive dividend issued and the fourth in the credit union’s history. Logix had for decades been known as the Lockheed Federal Credit Union until changing its named in 2012. Due to the credit union’s financial strength it can offer the dividend and show that it is different from other institutions, said President and Chief Executive Dave Styler. “It is so rewarding to directly share our financial success with our members,” Styler said in a statement. For the quarter ending Dec. 31, Logix had total assets of $3.7 billion including deposits of $3.1 billion, making it the largest credit union based in the San Fernando Valley. Planning Partner Rebecca Gibb began the new year being named as a partner with accounting firm Holthouse Carlin & Van Trigt. Gibb joined Holthouse Carlin in 2000 and currently works out of the Camarillo office where she focuses on employee benefit plan audits. A graduate of California State University, Northridge, Gibb has experience auditing 401(k) plans, defined benefits plans, employee stock ownership plans and 403(b) plans available at certain non-profits, school districts, hospitals and churches. Prior to joining Holthouse Carlin, she worked as an accountant and financial analyst at Paramount Pictures. Word-of-Mouth Banking UMe UMe Federal Credit Union ended 2013 on a strong note, according to the annual report issued to its members in late February. The Burbank financial institution had total assets of $154 million and a net income of $421,525 for last year. In 2012, the credit union has total assets of $148 million and net income of $542,675. During the year, the credit union added 965 new members to bring the total to nearly 13,000. UMe Chief Executive Robert Einstein attributed the growth in members to consumers looking for a better banking experience, advertising and a strong community presence. “We are doing good job of serving people and they are telling other people what a great place we are to bank with,” Einstein said. Staff Reporter Mark R. Madler can be reached at (818) 316-3126 or [email protected].