New Tax Laws - Linkenheimer LLP CPAs & Advisors

Cash Payments and Tax Relief for Individuals in New Law

A new law signed by President Trump on March 27 provides a variety of tax and financial relief measures to help Americans during the coronavirus (COVID-19) pandemic. This article explains some of the tax relief for individuals in the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

Individual cash payments

Under the new law, an eligible individual will receive a cash payment equal to the sum of: $1,200 ($2,400 for eligible married couples filing jointly) plus $500 for each qualifying child. Eligibility is based on adjusted gross income (AGI).

Individuals who have no income, as well as those whose income comes entirely from Social Security benefits, are also eligible for the payment.

The AGI thresholds will be based on 2019 tax returns, or 2018 returns if you haven’t yet filed your 2019 returns. For those who don’t qualify on their most recently filed tax returns, there may be another option to receive some money. An individual who isn’t an eligible individual for 2019 may be eligible for 2020. The IRS won’t send cash payments to him or her. Instead, the individual will be able to claim the credit when filing a 2020 return.

The income thresholds

The […]

By Linkenheimer LLP|2020-09-03T20:03:12+00:00March 31st, 2020|child, individuals, New Tax Laws, relief, tax planning|0 Comments

The New COVID-19 Law Provides Businesses and Employees With More Relief

On March 27, President Trump signed into law another coronavirus (COVID-19) law, which provides extensive relief for businesses and employers. Here are some of the tax-related provisions in the Coronavirus Aid, Relief, and Economic Security Act (CARES Act).

Employee retention credit

The new law provides a refundable payroll tax credit for 50% of wages paid by eligible employers to certain employees during the COVID-19 crisis.

Employer eligibility. The credit is available to employers with operations that have been fully or partially suspended as a result of a government order limiting commerce, travel or group meetings. The credit is also provided to employers that have experienced a greater than 50% reduction in quarterly receipts, measured on a year-over-year basis.

The credit isn’t available to employers receiving Small Business Interruption Loans under the new law.

Wage […]

By Linkenheimer LLP|2020-09-03T20:03:12+00:00March 30th, 2020|business, disaster, employer, filing deadline, gift tax, individuals, irs, New Tax Laws, small business, tax deadlines, tax implications, tax planning, taxpayer|0 Comments

IRS FAQs Address 90-day Filing and Payment Extension

The IRS has released a set of Frequently Asked Questions (FAQs) that clarifies certain aspects of the 90-day filing and payment extension provided in Notice 2020-18. Among other things, the FAQs explain that Notice 2020-18 postpones the filing and payment of federal income taxes reported on Form 1040, Form 1041 , Form 1120, Form 8960, Form 8991 , and Form 990-T (if that form is due to be filed on 4/15/20). The due date has not been postponed for Form 1065, Form 1065-B , Form 1066, Form 1120-S, payroll taxes, excise taxes, estate and gift taxes, and Form 990-T (if that form is due 5/15/20). The FAQs also provide that the deadline for making contributions to an IRA, HSA, or Archer MSA for 2019 has been extended to 7/15/20. The IRS continues to consider additional guidance on these issues and cautions taxpayers that FAQs are not citable as legal authority. The FAQs can be accessed at www.irs.gov/newsroom/filing-and-payment-deadlines-questions-and-answers If you have questions about how these changes may effect you and your business, please contact your Linkenheimer CPA.

By Linkenheimer LLP|2020-09-03T20:03:13+00:00March 26th, 2020|business, CA tax, irs, New Tax Laws, tax deadlines, tax implications|0 Comments

SBA Offering Loans to Small Businesses Hit Hard by COVID-19

Every company has faced unprecedented challenges in adjusting to life following the widespread outbreak of the coronavirus (COVID-19). Small businesses face particular difficulties in that, by definition, their resources — human, capital and otherwise — are limited. If this describes your company, one place you can look to for some assistance is the Small Business Administration (SBA).

New loan, relaxed criteria

The agency has announced that it’s offering Economic Injury Disaster Loans under the Coronavirus Preparedness and Response Supplemental Appropriations Act, which was recently signed into law.

Here’s how it works: The governor of a state or territory must first submit a request for Economic Injury Disaster Loan assistance to the SBA. The agency’s Office of Disaster Assistance then works with the governor to approve the request. Upon completion of this process, affected small businesses within the state gain access to information on how to apply for loan assistance.

To speed the process, […]

By Linkenheimer LLP|2020-09-03T20:03:13+00:00March 25th, 2020|business, New Tax Laws, relief, small business|0 Comments

Coronavirus (COVID-19) Tax Relief and California Updates

As we mentioned in our last post, taxpayers now have more time to file their tax returns and pay any tax owed because of the coronavirus (COVID-19) pandemic. The Treasury Department and IRS announced that the federal income tax filing due date is automatically extended from April 15, 2020, to July 15, 2020.

Taxpayers can also defer making federal income tax payments, which are due on April 15, 2020, until July 15, 2020, without penalties and interest, regardless of the amount they owe. This deferment applies to all taxpayers, including individuals, trusts and estates, corporations and other non-corporate tax filers as well as those who pay self-employment tax. They can also defer their initial quarterly estimated federal income tax payments for the 2020 tax year (including any self-employment tax) from the normal April 15 deadline until July 15.

No forms to file

Taxpayers don’t need to file any additional forms to qualify for the automatic federal tax filing and payment relief to July 15. However, individual taxpayers who need additional time to file beyond the July 15 deadline, can request a filing extension by filing Form 4868. Businesses who need additional time must file […]

By Linkenheimer LLP|2020-09-03T20:03:14+00:00March 25th, 2020|business, CA tax, filing deadline, irs, New Tax Laws, tax deadlines|0 Comments