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IRS Notice: Employee Retention Credit

2021 – 04/05 The IRS has provided guidance to employers claiming the employee retention credit (ERC) for 2021. In Notice 2021-23, the IRS explains how employers can determine their eligibility for, and the amount of, the ERC they may claim for the first two quarters of 2021. During the first two quarters of 2021, the…

Tax advantages of hiring your child at your small business

2021 – 04/05 As a business owner, you should be aware that you can save family income and payroll taxes by putting your child on the payroll. Here are some considerations. Shifting business earnings You can turn some of your high-taxed income into tax-free or low-taxed income by shifting some business earnings to a child…

FAQ: American Jobs Plan

2021 – 04/01 President Biden has released a summary of the “American Jobs Plan” that focuses on infrastructure improvements and other initiatives. He also released the “Made in America Tax Plan” to help pay for the proposals. Among other provisions, it would increase the corporate tax rate from 21% to 28% and discourage offshoring to…

PPP Loan Application Extended to June 1st

2021 – 04/02 President Biden has signed the Paycheck Protection Program Extension Act of 2021, which extends the covered period for the PPP. Before the law was passed, the loan application deadline was set to expire on March 31, 2021. The new law extends the deadline to May 31, 2021. In addition, the Small Business…

IRS Backlog

2021 – 04/01 The IRS is swamped with a backlog of unprocessed returns, according to a recent report. The Treasury Inspector General for Tax Administration (TIGTA) report stressed that the IRS’s ability to resolve the backlog “could be affected by the need to divert resources to issue additional Economic Impact Payments or an unforeseen closure…

Tax Credit for Employees’ Tips

2021 – 03/30 Food and beverage establishments may be able to get a tax credit for their employees’ tips. The credit is for the Social Security and Medicare (FICA) taxes the employer paid on the employee’s tip income. After employees report their tips to you, you must withhold and remit their share of FICA taxes…

Employee Retention Credit: Does Your Business Qualify

2021 – 03/30  Did your business retain employees during the COVID-19 pandemic? If yes, you could enjoy tax relief with the Employee Retention Credit (ERC). Originally introduced with the CARES Act, the ERC is a refundable tax credit against certain employment taxes equal to 50% of qualified wages, up to $10,000 per employee, that an…

Need a new business vehicle? Consider a heavy SUV

2021 – 03/29 Are you considering buying or replacing a vehicle that you’ll use in your business? If you choose a heavy sport utility vehicle (SUV), you may be able to benefit from lucrative tax rules for those vehicles. Bonus depreciation Under current law, 100% first-year bonus depreciation is available for qualified new and used…

COBRA provisions play critical role in COVID-19 relief law

2021 – 03/24 During the COVID-19 pandemic, many employees and their families have lost group health plan coverage because of layoffs or reduced hours. If your business has had to take such steps, and it’s required to offer continuing health care coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA), the recently passed American Rescue…

Passports Revoked Due to Tax Debt

2021 – 03/22 The IRS has resumed a program under which the U.S. State Department can revoke taxpayers’ passports. Having a “seriously delinquent tax debt” is (unless an exception applies) grounds for denial, revocation or limitation of a passport. If the IRS determines a taxpayer has a serious delinquent tax debt, it will “certify” that…

IRS2GO Mobil app

2021 – 3/19 You’ve likely heard that the IRS has extended the deadline for individuals to file their 2020 tax returns from April 15 to May 17. But if you’ve already filed your return and owed a refund, when you can expect to receive it? The IRS has two options to find out: the online…

Is It a Business or Hobby?

2021 – 03/18 Taxpayers engaged in business with the intent to profit can generally deduct related expenses on their tax returns. In the absence of a profit motive, the IRS may deem the activity to be a hobby and disallow loss deductions. In one case, a married taxpayer owned a brokerage firm. He also engaged…

New COVID-19 relief law extends employee retention credit

2021 – 03/17 Many businesses have retained employees during the COVID-19 pandemic and enjoyed tax relief with the help of the employee retention credit (ERC). The recent signing of the American Rescue Plan Act (ARPA) brings good news: the ERC has been extended yet again. The original credit As originally introduced under last year’s CARES…

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