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IRS Issues Employee Payroll Tax Deferral Guidance
Posted by Chrissy Hammond on Mon, Aug 31, 2020 @ 05:31 PM

Late Friday, the IRS released guidance that implements President Trump’s executive order permitting employers to defer certain employee payroll taxes. The IRS guidance provides key details on employee eligibility, the repayment period, and employer responsibilities. But the IRS guidance leaves some questions unanswered, even as the optional deferral period takes effect September 1. Importantly, the IRS guidance could cause an economic hardship for many employees while exposing employers to a new contingent liability.

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Topics: IRS, tax relief, payroll taxes, COVID19, Employee Payroll Tax Deferral

Comparing the Tax Plans of Kamala Harris and Joe Biden
Posted by Bill Smith on Tue, Aug 25, 2020 @ 10:27 AM

George H.W. Bush was the last person to be elected President after serving as a Vice President. Presidential candidate Joe Biden would be the first in over 30 years. Without many modern day examples, it is difficult to gauge the influence of a Vice President’s positions on actual U.S. policy, although Dick Cheney was highly influential on the policies of President George W. Bush. History aside, there are reasons to believe that the positions of Vice Presidential candidate Kamala Harris would be a strong influence. Her role as a former District Attorney and subsequently Attorney General of California is one significant reason. Another reason is that Biden, who would be 78 at the time he takes office if he wins, would be the oldest person to become President in U.S. history. With these factors in mind, it is time to examine, compare, and contrast Harris’s tax policies with Biden’s.

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Topics: IRS, Taxes, COVID19, Coronavirus, Biden, Harris, #taxplan, Kamala Harris

Will PPP Loans Trigger a Higher Tax Bill?
Posted by Chrissy Hammond on Tue, Aug 25, 2020 @ 09:00 AM

The Payroll Protection Program (PPP) brought swift relief to thousands of organizations disrupted by the COVID-19 pandemic by offering potentially forgivable loans to cover employee costs and certain other expenditures. Like the pandemic, the scale of the $650 billion loan program was unprecedented. Accounting and tax rulemakers are now parsing the manner in which PPP loan recipients should report their loan proceeds on financial statements and tax returns.

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Topics: IRS, Taxes, COVID19, PPP, PPP Loan

Be Mindful of Any Planned Moves: How Residency Affects State Tax Obligations
Posted by Chrissy Hammond on Mon, Aug 24, 2020 @ 01:00 PM

As more options become available to work virtually, people are considering where they want to maintain a home or “domicile,” both for convenience and for personal fulfillment, since they may no longer be strictly tied to working from an office. One of these considerations may be moving to a state with lower taxes, particularly in the wake of changes made in the tax reform law commonly known as the Tax Cuts and Jobs Act (TCJA). Before planning a move to another state, it is important to understand  the concept of “domicile” or “residence,” and how these are defined for state and local tax purposes to avoid unwanted attention from states desperate to find revenue during this pandemic.

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Topics: state and local tax (SALT), SALT, COVID19, Coronavirus, Coronavirus Aid, Relief, and Economic Security Act

Final Business Interest Expense Rules Provide Relief to Manufacturers
Posted by Chrissy Hammond on Wed, Aug 19, 2020 @ 06:22 PM

Businesses that hold inventory for sale to customers are in for a bit of good news. Late last month, the IRS released final regulations on the business interest expense limitation, and eased up on proposed guidelines that would have curtailed larger deductions for business interest expense by businesses that capitalize certain expenses under Section 263A’s Uniform Capitalization rules (UNICAP).

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Topics: IRS, tax relief, Business Interest Expense, COVID19, manufacturing, distribution, Uniform Capitalization rules, UNICAP

11 Accounting Challenges Arising from COVID-19
Posted by Mark Winiarski on Tue, Aug 18, 2020 @ 05:38 PM

When organizations are financially struggling or affected by external events, several accounting considerations come into play. External events arising from the COVID-19 pandemic and its disruption could intersect with several components of accounting. A brief summary of possible considerations are described below.

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Topics: goodwill impairment, going concern, income tax accounting, Revenue recognition, COVID19, Coronavirus, financial statement disclosures, SEC, PPP Loan, Payment Protection Program, credit loss

Presidential Election and Coronavirus-Ravaged Economy Provide Impetus to Review Estate Plans
Posted by Chrissy Hammond on Thu, Aug 13, 2020 @ 08:30 AM

It is always important when considering year-end tax planning to include estate and gift tax considerations, but this year’s presidential election paired with the economic downturn makes estate planning especially important. It has been reported that Presidential candidate Joe Biden wants to roll back the estate tax exemption to as little as $3.5 million from the current amount of $11.58 million. He has stated that he also wants to remove many provisions of the tax reform law commonly known as the Tax Cuts and Jobs Act (TCJA), particularly those that benefit wealthy individuals. And lowering the exemption would be consistent with a campaign that is predicated on tax increases for the wealthy.

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Topics: estate planning, estate tax, COVID19, Coronavirus, Coronavirus Aid, Relief, and Economic Security Act, Biden

Assessing the Impact of President Trump’s 4 Executive Orders
Posted by Bill Smith on Wed, Aug 12, 2020 @ 05:39 PM

President Trump took unprecedented action over the past weekend signing four executive orders related to the ongoing coronavirus pandemic. These orders include a payroll tax deferral, a temporary increase in unemployment benefits, a statement on reducing evictions, and a continuance of the pause for student loan payments and student loan interest. Several members of Congress have questioned the legal basis for certain of the executive orders, with the exception of the student loan moratorium. It is unclear whether or when Congress may bring a legal challenge to certain of the executive orders. In any case, various federal agencies must implement the executive orders before they can become effective.

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Topics: IRS, payroll taxes, Taxes, Trump, COVID19, Coronavirus

Amid Legislative Uncertainty, SBA Clarifies Payroll Costs and Other PPP Provisions
Posted by Chrissy Hammond on Wed, Aug 12, 2020 @ 10:48 AM

The window for applying for a Paycheck Protection Program (PPP) expired on August 8, and the next phase of the program began—application for PPP loan forgiveness. A SaaS tool to simplify submission, the Small Business Administration (SBA)’s PPP Forgiveness Platform began accepting submissions on Aug. 10, 2020.

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Topics: IRS, Taxes, COVID19, PPP, PPP Loan

Executive Order for Payroll Tax Holiday Puts Employers in No-Win Scenario
Posted by Bill Smith on Mon, Aug 10, 2020 @ 10:55 AM

On August 8, President Donald Trump signed four Executive Orders, one of which addresses a federal payroll tax holiday that he has sought to have included in any new coronavirus pandemic relief legislation. The President’s order is in response to the absence of movement by Congress on an additional stimulus package. The new order defers the withholding, deposit and payment of the employee’s share of federal OASDI (Social Security) payroll taxes (6.2%) from Sept. 1, 2020 through Dec. 31, 2020, on wages of employees whose annualized income is “generally” less than $100,000. While some have questioned President Trump’s legal authority to take this action, employers are placed in a precarious and potentially costly situation regardless of the legal outcome.

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Topics: IRS, payroll taxes, Taxes, Trump, COVID19, Coronavirus

Customer Retention, Revenue Recognition & COVID-19
Posted by Pieter Combrink on Wed, Aug 5, 2020 @ 12:25 PM

The economic impact from the novel coronavirus has been a significant challenge for most companies, whether due to changes in customer demand, shuttering of operations or constraints on labor and supply chain. Considering these ramifications, companies may be more inclined in the COVID-19 pandemic environment to implement pricing changes in order to improve customer retention. Such steps may include incremental discounting in the form of marketing offers, broad ranging price concessions, or specific customer contract modifications. The revenue recognition implications from these actions can be complex; we will delve into each to highlight the nuances and accounting considerations of each.

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Topics: Revenue Recognition Standard, Revenue recognition, COVID19, Coronavirus, Coronavirus Aid, Relief, and Economic Security Act

7 Ways COVID-19 May Affect State & Local Filing Requirements
Posted by Tarra Curran and Ann Brown on Mon, Aug 3, 2020 @ 08:00 AM

The state and local tax implications for your business will require careful attention in the COVID-19 pandemic environment. Remote work during shutdown orders led to many workers finding themselves working for an organization from a different state. Some may even opt to change locations now that working virtually has become a more permanent option.

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Topics: Tarra Curran, state and local tax (SALT), new england state and local tax, Ann Brown, COVID19, Coronavirus, COVID-19, remote work

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