A measure to extend the Paycheck Protection Program (PPP) application deadline from March 31, 2021, to May 31, 2021, has passed the U.S. House of Representatives and the Senate. It now heads to President Biden’s desk for signature which he is expected to do promptly.
Registered Investment Advisors (RIAs) serve an important role in their client’s lives. They can often be financial custodians to their clients and hold great responsibility for the client’s financial situation. Due to past examples of mismanagement by RIAs in recent history, the Securities and Exchange Commission (SEC) began requiring annual surprise exams (surprise audits) of RIAs to detect fraud, misused, or misappropriated use of client assets managed by RIAs.
The American Rescue Plan Act (ARPA) has been signed into law by President Biden and makes significant updates to several tax provisions to alleviate some of the pandemic's financial burdens for individual taxpayers and businesses. Updates include expansions and extensions of various tax credits such as the employee retention credit (ERC), COBRA continuation coverage, Affordable Care Act (ACA) subsidies, and more. The bill also includes $1.46 billion for the IRS to manage the additional responsibilities on top of the annual tax filing season. Here are the critical tax updates.
The American Rescue Plan Act (ARPA) of 2021 passed Congress and President Biden signed the bill into law on March 12, 2021. The ARPA approves $1.9 trillion in spending for individuals, businesses, governments, and certain industries impacted by the COVID-19 pandemic. The third Act in a year, the ARPA approves additional economic impact payments for individuals; the extension of federal unemployment benefits; additional funds for Paycheck Protection Program (PPP) Loans, and Economic Injury Disaster Loans (EIDL) for hard-hit small businesses; and grants for food and beverage establishments. Here are the key individual and business provisions in the bill.
The IRS has released additional guidance in Notice 2021-20 on the Employee Retention Tax Credit (ERC) with clarifications on the retroactive changes for expanded eligibility applicable to 2020. Employers who received a Paycheck Protection Program (PPP) loan have been waiting on guidance on claiming the credit in combination with forgiveness of their loan. The provisions outlined here apply to retroactive claims for 2020 as well as providing a plan for those yet to seek forgiveness.
Form 1040, Schedule C taxpayers received an updated interim final rule (IFR) on the Paycheck Protection Program (PPP) from the Small Business Association (SBA). The IFR clarifies guidance released on Feb. 22 that made changes to how self-employed and sole proprietors could calculate their maximum loan amount to help expand the program for these groups. Approximately 2.6 million sole proprietors have applied for PPP loans, and it is estimated there are about 25 million sole proprietors across the country.
The nation’s smallest businesses are getting revamped Paycheck Protection Program (PPP) rules and a special filing period announced in recent changes from the Biden-Harris administration. Small businesses with fewer than 20 employees make up 98% of the small businesses in the U.S. but have not received much assistance from the PPP so far and have accounted for a significant portion of business closures during the pandemic. These new rules seek to remedy that. Here’s what you should know.
Have you ever tried to claim a new tax deduction, but in the process of compiling supporting documents, you found you were missing critical information and therefore missed out on the opportunity? Or, have you ever faced an IRS audit and struggled to come up with documentation supporting your tax return data? How about this currently familiar experience, your records are in your brick and mortar office, but your staff is working remotely. Or you need to gather documents for Paycheck Protection Program (PPP) loans. As you can see, good recordkeeping is more than a storyboard for your business; it’s a valuable tool for tax preparation and in today’s climate, loan forgiveness.
The Tax Cuts & Jobs Act (TCJA) of 2017 made many significant changes for business tax deductions including the disallowing of the business deductions for most entertainment expenses. The IRS has since released final regulations for the treatment of meals and entertainment deductions, and businesses should be apprised of these changes.
When Federal Laws change, in Mass. there is an automatic mandate that Corporations will follow current Federal rules. However, for individuals whose business income comes from a Schedule C or a pass through entity, Massachusetts generally follows the Code as amended and in effect on January 1, 2005. Therefore, for a borrower subject to Massachusetts personal income tax, any amount forgiven under Section 1106 of the Act is includable in gross income and subject to tax, and there is no disallowance of deductions attributable to the payment of expenses resulting in the forgiveness of the loan.
The Internal Revenue Service recently issued the 2021 optional standard mileage rates. These rates, which adjust every year to account for inflation of fuel costs, vehicle cost and maintenance, and insurance rate increases, will once again affect the way a company reimburses their mobile workers.
The employee retention tax credit (ERTC) is intended to provide liquidity to employers during the pandemic and was greatly expanded in the Consolidated Appropriations Act of 2021 thanks to Sections 206 and 207 of the Taxpayer Certainty and Disaster Relief Act portion, opening the doors to more businesses to be able to qualify for and receive this credit who are facing significant hardship as a result of the coronavirus pandemic. Many changes from the original credit were enacted including an expansion in the amount of credit and business eligibility, and how it plays with the Paycheck Protection Program (PPP).
This credit is geared towards employers subject to partial or full COVID-19 related closures. This credit impacts compensation, furlough, and layoff strategies. If you are considering making workforce reductions, it is important to understand your options under the CARES Act.
Two new interim final rules for the Paycheck Protection Program (PPP) have been released from the Small Business Administration (SBA) and Treasury in response to the changes and second round of funding enacted by the relief portion of the Consolidated Appropriations Act signed at the end of December.
The U.S. House of Representatives and U.S. Senate have passed the Coronavirus Response & Relief Supplemental Appropriations Act, and President Trump has signed the bill. The agreement comes after weeks of negotiations and two funding extensions to keep Congress open until a bill was passed with a $1.4 trillion government-wide funding plan. The $900 billion coronavirus relief portion includes another round of Paycheck Protection Program (PPP) funding, extended unemployment benefits, and direct payments to taxpayers. Here’s an overview of the key provisions in the bill.
The pandemic created by the novel coronavirus has drastically changed the way we live and work. As more businesses are forced to send their employees home, work-from-home life has become a mainstay especially in knowledge-based jobs (jobs that do not require physical labor), and many of these industries are not going back to the workplace anytime soon. This can create wrinkles for both employers and employees when it comes to their tax situations. Here’s what employers and employees need to know about remote work and the impact it can have on taxes.
Following the reopening of the IRS in July 2020, high-income earners and private foundations have been under the IRS’s lens in an effort to recover back taxes owed by these groups. Treasury Secretary Steven Mnuchin reported that the IRS would be looking to audit these groups back in March 2020, in an effort to recover taxes from high-income non-filers and interrupt self-dealing in private foundations.
On Nov. 18, the IRS and Treasury issued Revenue Ruling 2020-27 which provides long-awaited guidance on the tax treatment of expenses related to Paycheck Protection Program (PPP) loans. The guidance states that the expenses listed in section 1106(b) of the CARES Act that would otherwise be deductible will not be allowed in the taxable year that the expenses were paid or incurred and covered under a PPP loan that is forgiven or expected to be forgiven.
Walter & Shuffain, P.C. (Walter & Shuffain) has been ranked the #1 Best Firm for Young Accountants from Accounting Today for 2020. The Best Firm for Young Accountants award is determined using the data from employees under 30 years-of-age who completed the Top 100 Best Firms to Work For survey (to which Walter & Shuffain was also named). Accounting Today names 10 firms from the list, with Walter & Shuffain taking the #1 spot for 2020.
The Paycheck Protection Program (PPP) from the Small Business Administration (SBA) and Treasury has had many updates over the past few months including changes to timelines and forgiveness applications. Among these changes was the introduction of three different types of forgiveness applications:
This year has been unique and beyond comparison in many ways, and tax planning is just one of the implications of current events. Both individual and business taxes have the potential to be significantly impacted by the various legislation that has passed like the FFCRA and the CARES Act, the loan programs made available like the PPP and the EIDL, and the unemployment/stimulus programs that touched many Americans. It’s imperative that we take into account all these potential factors when implementing your tax plan for 2020. In this article, we’ll take a look at the main areas to consider, both common and pandemic-related, when planning for 2020 year-end taxes.
According to news outlets, as of this writing, Joe Biden has been named the president-elect of the U.S. Vote counting is still ongoing and election results have not yet been certified, but this news may have some taxpayers wondering what changes, if any, they should make in their tax planning to close out an eventful tax year.
The Small Business Administration (SBA) and Treasury announced on October 8 that a simplified application (Form 3508S) for Paycheck Protection Program (PPP) loan forgiveness is now available for borrowers whose loans fall in the $50,000 or less threshold. As more and more businesses begin filing for PPP loan forgiveness, this change outlined in a new interim final rule greatly simplifies the process for borrowers with smaller loans. However, it is important to note that this simplified form is not equal to automatic forgiveness.
On Aug. 24, the Small Business Administration (SBA) and Treasury issued the latest interim final rule update to the Paycheck Protection Program (PPP) that seeks to clarify guidance related to owner-employee compensation and non-payroll costs. This guidance has been long-awaited and clears up several questions borrowers have had about forgiveness. Here are the main points:
Walter & Shuffain, P.C. (Walter & Shuffain) has been named to three professional accolade lists including the Top Accounting Firms to Work For from Accounting Today, and the Best of the Best Firms and Top 300 Firms from INSIDE Public Accounting (IPA).
Will I receive cash from the government? If so, when?
Single individuals with 2019 (2018, if your 2019 return hasn’t been filed yet) Adjusted Gross Income (AGI) up to $75,000 ($112,500 if you file as “head of household”) will generally receive a $1,200 rebate from the IRS. Joint filers with AGI up to $150,000 will receive a rebate of $2,400. An additional $500 rebate is available for each qualifying child under age 17. If your income is too high, the rebate will be reduced by $5 for each $100 your AGI exceeds the threshold. So, for a typical family of four, the amount is completely phased out once AGI exceeds $218,000.
Walter & Shuffain, P.C. (Walter & Shuffain) announces the acquisition of Russell, Brier & Co. LLP (Russell Brier) effective Sept. 1, 2020. The merger makes Walter & Shuffain a Top 20 firm in Massachusetts. The combination of the two firms offers the Boston metro area greater access to robust knowledge, expertise and skills, in addition to greater value through the firms’ complementary strengths, resources and experience.
The Small Business Administration (SBA) and Treasury released an updated Paycheck Protection Program (PPP) FAQ on Aug. 4 in an effort to address PPP loan forgiveness issues that have arisen as borrowers begin to complete their applications. The 23 FAQs address various aspects of PPP forgiveness including general loan forgiveness, payroll costs, non-payroll costs, and loan forgiveness reductions.
The U.S. Senate and House of Representatives have both unanimously agreed to extend the Paycheck Protection Program (PPP) by five weeks.
On June 4, 2020, the president signed into law the Paycheck Protection Program Flexibility Act after it passed the Senate with a unanimous vote.
On May 28, 2020, in a nearly unanimous vote, the U.S. House of Representatives voted to extend certain provisions of the Paycheck Protection Program (PPP) to provide small businesses with relief in the timeframe and use of their PPP loan funds.
On May 15, the Small Business Administration (SBA) issued the Loan Forgiveness application and on May 22, the interim final rule guidance on the PPP loan forgiveness was issued.
The “CARES Act” provides a tax credit for eligible employers to encourage them to continue paying employees.
We are going to attempt to at least provide some best practices in the short term until clear guidance is available. Remember, this is for the 8 week period after the loan is issued.
The EIDL (Economic Injury Disaster Loan) program is a program available to certain small businesses located in areas subject to a presidential disaster declaration that have suffered a substantial economic injury as a result.
The PPP provides short-term cash flow assistance to small businesses to help these businesses and their employees deal with the immediate economic impact of the COVID-19 pandemic.
On March 18, 2020, the Families First Coronavirus Response Act (FFCRA) was signed into law, marking the second major legislative initiative to address COVID-19.
Changes to the existing SBA 7(a) loan programs and also provides information on SBA Disaster Loans and the Facebook Small Business Grant.
Phase 3 of the COVID-19 response plan, The Coronavirus Aid, Relief and Economic Security (CARES) Act
“Moving tax day from April 15 to July 15. All taxpayers and businesses will have this additional time to file and make payments without interest and penalties”
On Tuesday, March 17th, Treasury Secretary Mnuchin announced a 90-day grace period on the payment of individual and corporate taxes normally due April 15th.
Our top priority has always been to deliver superior service to our clients. To do that in the current environment, we're taking every precaution possible. Fortunately, we have the technological capability for everyone on our team to work remotely.
Congratulations to Danielle Donovan! Danielle is a recipient of one of the MSCPA’s 2019 Women to Watch Awards, selected as an Emerging Leader! The Women to Watch Awards recognize outstanding women in the accounting profession.
Walter & Shuffain, PC, was recently named as one of the 2019 Accounting Today’s Best Accounting Firms to Work for. "We're truly honored to have been named to Accounting Today’s 2019 Best Accounting Firms To Work For," said Jonathan Yorks, Managing Shareholder. "We employ a team approach to achieving clients’ business goals, and strive to create a fulfilling, energized, and supportive work environment for each and every member of our team."
Consumers who were once limited to their local storefronts to browse for goods are now able to shop and make purchases globally. Consumers aren’t the only ones benefitting from these digital shopping cart advancements. Businesses are now able to target a market well beyond their physical location, but these tempting multi-state customers come with challenges.
W&S Shareholder Angela Parziale shares her insights on the new US tax law and its impact on Real Estate in this CREW Network update
New lease accounting standards could impact balance sheets and financial reporting.
The Tax Cuts and Jobs Act (TCJA) offers many taxpayers a break through corporate and individual tax rate reductions. However, the new legislation comes with a few thorns. One of the biggest surprises to business owners is the elimination of the entertainment deduction.
W&S Shareholder Angela Parziale will be a discussion leader and head up a break-out session on the value of women's initiatives and being a mindful leader in the workplace.
Two of our shareholders, Angela Parziale and William Cooper, are featured in an article titled "Customizing Talent Development" on the Journal of Accountancy website.
On December 20, 2017, Congress approved sweeping tax reform. The President is expected to sign the bill next week in its current form.
The opportunity to defer tax is music to the ears of many. In this article, we’ll discuss the different types of 1031 exchanges and the potential benefits for each.
Not familiar with revenue recognition? An often-misunderstood principle, revenue recognition determines the conditions under which revenue is received. The new standards emphasize that revenue should be recorded when goods and services are transferred, or a customer takes control. Control is identified as the ability to direct the use of and reap the benefits of the goods or services performed under the contract. The guidance provides five steps to implementing the new standards.
Start-ups and small businesses customarily incur expenditures that may qualify for Research & Development (R&D) tax credits, but generally, these businesses don’t have the taxable profit needed to take advantage of the credit. The IRS issued guidance earlier this year that explains how qualifying small businesses can now apply all or a portion of the credit against their payroll tax liability, including social security taxes. Below we’ve answered some of the key R&D questions and whether your business is eligible for offsetting payroll tax.
Walter & Shuffain, P.C. was recently named one of Accounting Today’s 2017 Best Accounting Firms To Work For. Accounting Today partnered with Best Companies Group to identify the top 100 companies that excel in creating quality workplaces for employees.
We are proud to announce that W&S has been selected as a Best of the Best Firm by INSIDE Public Accounting (IPA).