Tax News

  • DEDUCTING 2021 FREEZE DAMAGE ON YOUR 2020 TAX RETURN

    The February 13–17, 2021 North American winter storm, unofficially referred to as Winter Storm Uri, was a major winter and ice storm that had widespread impacts across the United States, Northern Mexico, and parts of Canada. Over 9.9 million people in Texas alone suffered blackouts, little or no water, and burst pipes due to Winter […]

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  • IRS CHANGES HOW UNEMPLOYMENT INCOME IS TAXED

    The IRS has changed the tax treatment of the New Exclusion of up to $10,200 of Unemployment Compensation guidance. Its original guidance included unemployment income in adjusted gross income when calculating the $150,000 modified adjusted gross income (MAGI) limitation. On March 23, 2021, the IRS updated its instructions for the unemployment compensation exclusion worksheet and […]

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  • AMERICAN RESCUE PLAN ACT OF 2021

    President Biden has just signed the $1.9 trillion  American Rescue Plan Act (ARP) of 2021, which includes a few COVID-related tax provisions you should know about. Most interestingly, it contains no provision to pay for the spending, including any income or estate and gift tax increases. 2020 tax-free unemployment benefits The bill continues the $300 […]

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  • NEW IRS CAMPAIGN TARGETS HIGH-INCOME TAXPAYERS

    While the IRS audit coverage has declined for most people, primarily due to budget cutbacks, the IRS will soon be back with a vengeance ‒ targeting high-income individuals. The overall individual audit rate is only about one in 250 returns, but the odds increase as your income goes up (especially if you have business income). […]

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  • SIDE GIG? YOU MAY OWE MORE THAN JUST INCOME TAX

    The gig economy is integral to millions of Americans’ livelihoods, and just like the silent partner they are, the IRS wants its share. The IRS says the gig economy includes any “activity where people earn income providing on-demand work, services or goods,” such as ride-sharing and delivery services, running errands, and selling products online. That […]

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  • IRS POSTPONES APRIL 15 FILING DEADLINE IN TEXAS

    The Internal Revenue Service announced that victims of this month’s winter storms in Texas will have until June 15, 2021, to file various individual and business tax returns and make tax payments. This is pursuant to a disaster declaration issued by the Federal Emergency Management Agency (FEMA). Taxpayers in other states impacted by these winter […]

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  • IRS ASKED TO EXTEND THE 2020 TAX RETURN FILING DEADLINE PAST APRIL 15, 2021

    On February 18, 2021 the U.S. House Ways and Means Committee wrote a letter to the IRS Commissioner Charles P. Rettig requesting an extension of time to file 2020 tax returns past the statutory date of April 15, 2021. As we recall, last year the IRS extended the filing deadline from April 15 to July […]

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  • IRS Temporarily Exempts PPP Loan Proceeds from Levy

    The Internal Revenue Service (IRS) has temporarily modified its levy procedures, through September 15, 2021, for taxpayers that received Paycheck Protection Program (PPP) loans.  The SBA requires eligible small businesses to use their PPP loan proceeds to pay certain expenses, including payroll, health insurance, retirement benefits, and rent. PPP loans may be fully forgiven when […]

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  • Self-Employed Individuals Entitled to $5,110 Tax Credit if Affected by COVID

    Self-employed individuals, including sole proprietors and partners in partnerships, should not forget to claim the new credit for sick leave or family leave that is available on their 2020 Forms 1040 if they qualify. The IRS has released Form 7202 (Credits for Sick Leave and Family Leave for Certain Self-Employed Individuals) and its instructions. Self-employed […]

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  • Why Does the SBA Take So Long to Approve My PPP Loan?

    The American Institute of CPAs sent a letter to the Small Business Administration (SBA) on February 3, 2021 urging it to correct the processing errors and delays that small businesses are experiencing with the current Paycheck Protection Program (PPP) loan application system. “PPP loans have proven to be a critical lifeline for the millions of […]

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