The Tax Cuts and Jobs Act (TCJA) of 2017 included major changes to the Internal Revenue Code, but many of them are set to expire after December 31, 2025. There are several individual income and business tax provisions that will expire, but most notably the Estate and Gift tax basic exclusion amount is set to decrease dramatically. Although Congress may pass new legislation that may extend some of these provisions, it is important to be aware of them and plan accordingly. If you have not spoken with your estate attorney recently, 2024 will be a good year to speak with them and review your estate plan. Click on the link below to read more about the tax provisions set to sunset.
Effective January 1, 2024, many business owners became responsible for a new filing requirement called Beneficial Ownership Information Reporting under the Corporate Transparency Act. Please review the document below to determine your obligation. For most businesses that were operating prior to January 1, 2024, the initial deadline to comply is December 31, 2024. Please reach out to me if you have any questions.
The Inflation Reduction Act was signed into law on August 16, 2022. The budget reconciliation bill includes many provisions, including those related to Medicare benefits, clean energy incentives and manufacturing jobs. There are also several tax provisions included in the law. This Journal of Accountancy article highlights the tax provisions of the new law.
There are have been significant changes made to the child tax credit, including the possibility of receiving partial pre-payments of the credit for tax year 2021. Use the link below to check eligibility, manage pre-payments and to opt out of pre-payments. In order to manage your payments, you will be required to set up a portal with the IRS. This process requires identity verification (for taxpayer and spouse if filing jointly).
Reminder that 2020 Individual tax returns and payments are due May 17, 2021. However, 2020 Trust tax returns and 1st Quarter 2021 estimates are still due April 15, 2021.
The American Rescue Plan Act was signed into law on 3/11/21. The act provides for another round of economic impact payments and an expansion of the child tax credit that allows for eligible taxpayers to receive the benefit of the credit before filing their tax returns. There are several other miscellaneous tax provisions included in the act.
The Small Business Administration Paycheck Protection Program was re-opened earlier in the year as well. Small businesses who had not already applied for PPP funds last year may be eligible to do so now. Also, small businesses who did receive round 1 PPP funds may be eligible for a second-draw PPP loan (in general, must have experienced a 25% or more reduction in revenue in all or a part of 2020 compared with a comparable period in 2019). Currently, applications must be submitted by 3/31/21; however, the AICPA has been urging Congress for a deadline delay to allow more businesses to apply. UPDATES TO PPP PROGRAM ARE INCLUDED ON THE LINKS IN RIGHT COLUMN BELOW
In case you missed it….the Consolidated Appropriations Act, 2021, was signed into law 12/27/20. In addition to providing a second round of economic impact payments earlier in the year, there were other CARES Act extensions and provisions included and other general tax provisions.
There have been many changes to the PPP loan forgiveness rules and procedures. The process to apply for forgiveness has been simplified for most small businesses and expenses paid using PPP funds are now deductible. Please click on the link below to learn more. As an AICPA member, I am also able to apply for forgiveness for businesses through their CPA Business Funding Portal for clients who need assistance with that process.
On June 17, 2020 the SBA released a new PPP Loan Forgiveness Application and instructions to reflect the changes made by the Paycheck Protection Flexibility Act of 2020. Please click the link below to read more about the changes and to find links to the applications.
On Wednesday, June 3, 2020, the Senate passed the House Paycheck Protection Flexibility Act. The bill allows recipients of Paycheck Protection Program funds additional time to spend the funds received and still qualify for loan forgiveness. The bill will help more recipients qualify for loan forgiveness then under the original Paycheck Protection Program created under the CARES act. Please find out more details by reading the Journal of Accountancy article regarding the new bill.
Click the link below to read details surrounding the extension of Federal income tax filing and payments. All income tax returns and payments due between April 15, 2020 and July 15, 2020 are automatically extended to July 15,2020. This includes 2020 2nd quarter estimates for Federal and SC estimates.
SC conforms with the US Treasury and has Delayed Filing SC Income Tax Returns and Payment of SC Income Taxes July 15, 2020. Extensions for other SC tax filings and payments have been extended to June 1, 20120. See this link for more details.