Specialty Tax Services

Tax planning for individuals, businesses, and families

Tax law changes enacted in 2025 and first applicable in either 2025 or 2026 could require you to reevaluate your tax planning. Convergence can help you think through opportunities and other considerations for you and your family during the remainder of 2025 and into 2026.

The OBBBA increased the state and local tax deduction (SALT) cap to $40,000 (single and married filing joint) for tax years beginning in 2025 until 2029. The increase is fully phased out for adjusted gross income amounts greater than $600,000, with a phaseout that begins at $500,000. Taxpayers with AGI over the fully phased-out limit will receive a deduction of $10,000; these amounts are set to increase by 1% annually, and the SALT cap is eliminated after 2029.
The OBBBA made the 20% Qualified Business Income (QBI) deduction permanent, offering long-term certainty for pass-through business owners. Business owners can now focus on maximizing their QBI eligibility and should consider reviewing their business structure.
The OBBBA made permanent the increased AMT exemption amounts and phaseout thresholds. It also modified the inflation adjustment for the phaseout threshold to $500,000 ($1,000,000 for married filing jointly), and increased the phaseout rate to 50%, all effective for tax years beginning after Dec. 31, 2025.
The OBBBA set the estate, gift and generation-skipping transfer (GST) tax exemptions permanently at $15 million per individual (or $30 million for married couples) starting Jan. 1, 2026, with inflation adjustments beginning in 2027. However, keep in mind that no tax law is truly permanent, as future administrations could enact changes to the exemptions.
Certain generation-skipping transfers could be subject to an additional 40% tax. You may avoid this tax by utilizing your generation-skipping tax (GST) exemption of $13,990,000 in 2025—it increases to $15 million in 2026, with an inflation adjustment thereafter. The GSTT should be a significant consideration in tax planning for transfers to beneficiaries at least two generations younger than the donor. The GST exemption can be allocated to transfers during life or at death to protect assets from GSTT. This allows you to safeguard your wealth and minimize tax exposure, ensuring a more efficient wealth transfer across generations.
If you are contemplating transferring a business interest as part of a business succession plan or ahead of a liquidity event, you should immediately consider potential estate planning opportunities. Valuation discounts may can be helpful for estate planning purposes because more units/shares may be transferred by gift under your gift tax exemption. Any future appreciation will accrue outside your taxable estate.
Beginning in 2026, charitable deductions will be subject to a 0.5% floor and an overall itemized deduction cap.
The OBBBA permanently extended and modified the Qualified Opportunity Zone (QOZ) program, including the introduction of a rolling 10-year redetermination of QOZ designations beginning Jan. 1, 2027.
The OBBBA made significant changes to Qualified Small Business Stock (QSBS) under Section 1202. Investors should carefully assess the timing and eligibility of current and future investments.

Cost Segregation Studies

Convergence helps owners of businesses with real estate assets to increase cash flow by accelerating federal tax depreciation and lowering their taxable income. Newly constructed buildings typically possess the largest cash flow benefit derived through accelerated tax depreciation, but older buildings constructed in prior years may also lead to significant tax savings.

We perform detailed cost reconciliations to secure these cash-flow benefits by:

Identifying construction-related assets on projects that qualify for bonus and accelerated depreciation and existing facilities that qualify for accelerated depreciation, including accent lighting, specialty flooring, millwork, land improvements, and Qualified Improvement Property (QIP)
The recently passed “One Big Beautiful Bill” (OBBB) makes a major change for business owners and investors, restoring 100% bonus depreciation permanently for properties placed in service after January 19, 2025
Identify facilities that were either constructed or acquired in prior years for implementing retroactive tax depreciation changes
Prepare Form 3115 to implement the accounting method change and the favorable catch-up depreciation adjustments. Generally, favorable adjustments are taken in the current year with no amended tax returns, and provide IRS audit protection
Identify energy-efficient technologies on new or renovated buildings eligible for incentives such as the §48 business energy investment tax credit and the § 179D energy-efficient commercial buildings deduction
Identify opportunities for property tax reductions and certain sales tax exemptions

Our experience in real estate allows us to provide a full-service approach to cost segregation that takes into account the constantly changing tax laws to identify significant tax savings.

Contact us today to learn more about how a cost segregation study from Convergence can provide significant tax savings this year.

State and local tax services

A continually changing state tax landscape makes it tough to stay informed and effectively plan for the future. Convergence can guide you and help you understand the compliance requirements or avoiding an overpayment of tax.

We help you stay up to speed with SALT laws and clarify the increasingly complex statutes. From state and local tax consulting to compliance assistance, we implement and manage solutions to create competitive advantages, mitigate your SALT tax exposure and minimize tax.

All states that have a sales tax have implemented economic nexus laws, and state regulators are aggressive in their efforts to audit filers and root out non-filers.

By creating solutions that align with your business objectives, Convergence helps you identify the possible impact of your tax obligations, mitigate your risk and liabilities and provide you with a comprehensive strategy to get your company compliant. We can assist with nexus studies, voluntary disclosure agreements, taxability determinations and compliance reporting to sales and use tax audit defense, refund overpayment reviews and jurisdictional tax registrations.

Tax Controversy Services

With increased examination efforts by federal and state authorities, tax controversy services are in high demand. The IRS is specifically focusing on examination of businesses, high-net-worth individuals, large partnerships and international transactions. IRS controversy matters are usually complex, urgent and unpleasant for taxpayers.

Tax audits involve many strategic considerations, so hiring a skilled tax controversy expert early on in your audit can significantly improve your chances of a positive result. Understanding the procedural requirements, tools at your disposal, and avenues for addressing penalties and resolving other notices from tax authorities can significantly impact your outcome.

Some of the federal tax controversy services we provide include:

Audit readiness, evaluation of the soft areas on the tax return and ways to address those areas to avoid penalties
Support during IRS, state and local examinations
Representation before the IRS Independent Office of Appeals
Penalty prevention and abatement

Interest computation and claims for abatement
Assistance with refund claims and appeal of the denial of claims for refund
Collection due process hearings and preparation
Entity issues such as entity classification elections and late entity classification elections or EIN retention after merger
Confirmation of S corporation status and other types of IRS elections and filing requirements

IRS voluntary disclosure processes

Tax Accounting Methods

As companies respond to dynamic environments, accounting methods can get outdated, losing key timing for income, deductions and cost capitalization or recovery. The wrong method costs money while the right accounting methods offer real benefits for deferring income and offering significantly better cash flow.

Convergence can help you reveal more tax-efficient accounting methods for improving cash flow, managing effective tax rates, mitigating past noncompliance, or even managing expiring net operating losses. Method changes are both strategic and tactical. Our accounting method specialists can prepare the required forms, including IRS Form 3115, help you implement the new methods and file the appropriate documents.

Contact us today to learn more about how we can help you take advantage of the tax saving opportunities associated with changing your company’s tax accounting methods.

Repairs vs. Capitalization Studies

In 2013 the IRS issued final rules, commonly referred to as the “repair regulations”, which provide guidance that determines whether and when a business must capitalize costs to acquire, maintain, or improve tangible property. Under these new repair regulations, taxpayers may realize tax savings by deducting rather than capitalizing certain repair expenses. As part of a study, we properly classify applicable costs and also file the associated request with the IRS to implement the change, if applicable.

This service may also include the following analysis:

Assessment of accounting methods and applicability
Material and supply analyses, including spare parts
De minimis rule assessment and implementation
Unit of property determination
Capitalization policy standardization
Repair and maintenance identification
Routine maintenance safe harbor analysis
Disposition and retirements, including partial and condition-adjusted disposition analysis
Accounting method changes considerations

Contact us today to discuss how a repair study from Convergence can both eliminate tax exposure while presenting new tax savings opportunities.