The CARES Act clearly states that a forgiven PPP Loan would not be treated as taxable income. However, it did not specify if the eligible expenses would be deductible. In April, the IRS issued Notice 2020-32 taking the position that these expenses would not be deductible. The Notice did not address how a taxpayer would report these non-deductible expenses if they were incurred in one tax year and loan forgiveness occurred in a subsequent tax year. (more…)
IRS Guidance Offers Relief and Confusion
Recent guidance from the IRS has granted additional relief to taxpayers impacted by California wildfires and created uncertainty for the implementation of one of President Trump’s August 8th Executive Actions. (more…)
US Tax News August 2020
Below is a summary of the Federal COVID-19 related updates from August 2020. (more…)
2020 Required Minimum Distributions (RMDs) - Waived Under the CARES Act
By Angel Nevis, CPA, Senior Tax Manager; Anu Joshi, CPA, Senior Tax Manager; Chris Madrid, CPA, Tax Director, ASL Family Wealth & Individual Tax Planning Group
ACTION REQUIRED BY AUGUST 31, 2020
If you have taken required minimum distributions from a retirement account in 2020 or are planning to, don’t miss this relief provision and potential tax-saving opportunity.
For the 2020 tax year only, RMDs from retirement accounts are not required. This includes distributions from traditional IRAs, SEP IRAs, SIMPLE IRAs, 401(k) plans, 403(b) plans, 457(b) plans, and profit-sharing plans. The waiver was recently expanded to include distributions from inherited IRAs, and also applies to certain taxpayers who reached RMD age in 2019. (more…)
Coping with Coronavirus - Recordkeeping Challenges for PPP Loan Recipients
The Paycheck Protection Program (PPP) has helped millions of businesses cope with the consequences of the COVID-19 shutdown. But, like any large and complex program, the PPP has also generated a lot of questions, particularly regarding the records borrowers must keep to qualify for loan forgiveness.
The rules governing PPP loan forgiveness cover a broad range of operational and financial areas and involve numerous tax and financial reporting documents. Some of the rules also have changed over time, further complicating the recordkeeping requirements. (more…)
The Paycheck Protection Program Flexibility Act Eases PPP Forgiveness Rules
The Paycheck Protection Program Flexibility Act (H.R. 7010) was signed by the President on June 5, 2020. It provides businesses who received or will receive a Paycheck Protection Program loan with more flexibility to use their funds and have their loans forgiven.
We have outlined the major provisions of the Act below. Please reach out to our COVID-19 Resource Team for further guidance or if you have any questions. (more…)
COVID-19, Your Business, and You: Taking Care of What Matters Most
By James Krech, Audit Senior
It’s no surprise we are currently experiencing unprecedented, uncertain, and unnerving times. As business owners, executives, and managers, your first priority could be tending to the business, identifying all the hardships that are currently present or that could arise in the near future, and making some hard decisions as to how to weather the storm. This response is certainly crucial to ensure the wellbeing and future success of the company and your employees, and there are many opportunities available for you to explore, which we will get into shortly. However, there is something just as equally important as supporting your company, if not more so, and that is caring for yourself. (more…)
SBA Announces Retro-Active Change to Paycheck Protection Loan Program
The Paycheck Protection Program (PPP) launched in early April with little guidance provided to both borrowers and lenders. Many businesses acted quickly to determine their maximum loan amounts and submit their applications before funds would run out. Recently, there has been scrutiny related to certain recipients of the funds. In light of this, we want to ensure you are aware of the certifications that borrowers were attesting to on their loan applications. Specifically, borrowers were representing that “current economic uncertainty makes this loan request necessary to support the ongoing operations of the applicant”. (more…)
How Does the SECURE Act Affect Estate Planning?
The Setting Every Community Up for Retirement Enhancement (SECURE) Act is the biggest retirement planning law in decades. However, when all is said and done, the new law may have just as significant an impact on estate planning, especially if younger individuals are in line to inherit IRAs or qualified retirement plan accounts.
Key SECURE Act provisions
The SECURE Act includes noteworthy provisions for both individuals and businesses. Let’s focus here on a summary of the key tax law changes for individual retirement-savers. (more…)