Farm businesses receive guidance on tax treatment of losses
The IRS in Rev. Proc. 2021-14 specifies procedures regarding limitation and carryback of net operating losses from farming in light of CARES Act provisions.
COVID-19
Bank information can now be updated on child tax credit portal
The IRS announced that is has added a new feature to its Child Tax Credit Update Portal to allow individuals to enter bank information so they can receive advance child tax credit payments by direct deposit.
ARPA-adjusted 2021 individual credit amounts set
The IRS issued guidance on the amount of and limitations on the child tax credit, earned income tax credit, and premium tax credit available for taxpayers for the 2021 tax year.
IRS reminds taxpayers of ARPA suspension of 2020 excess APTC repayment
The IRS said it would not require taxpayers who received excess advance premium tax credits for 2020 to file Form 8962, Premium Tax Credit, after the American Rescue Plan Act retroactively exempted those amounts from being taxe
Safe harbor allows 2020 PPP expenses to be deducted in 2021
The IRS issued guidance on a safe harbor permitting qualifying taxpayers who have PPP loans, who did not deduct expenses related to those loans paid or incurred in 2020 on their 2020 returns, to deduct the expenses on their returns for 2021.
‘Restaurant’ defined for 100% deductible business meals in 2021 and 2022
The IRS issued guidance on the temporary rule that allows a 100% deduction for eligible restaurant meals in 2021 and 2022.
Penalty relief for payroll tax deposits allows immediate use of pandemic credits
The IRS provided for penalty relief under Sec. 6656 for an employer’s failure to timely deposit certain employment taxes with the IRS to allow employers to immediately take advantage of various credits enacted in response to the COVID-19 pandemic.
ARPA expands tax credits for families
The American Rescue Plan Act made significant changes to the child tax credit and child and dependent care credit for the 2021 tax year, making the credits larger for most taxpayers and more widely available.
E-signing extended, new forms added
In response to the coronavirus pandemic, the IRS issued guidance extending the temporary authorization to issue a number of IRS forms using electronic signatures through Dec. 31, 2021.
Supreme Court declines to take up remote worker taxation case
The US Supreme Court declined to allow New Hampshire to sue Massachusetts over a pandemic-related regulation that allows Massachusetts to continue to collect state income tax from remote workers who normally work in Massachusetts.
IRS posts ARPA credit FAQs
The IRS has posted two sets of FAQs that explain changes to the child and dependent care credit and to the sick and family leave credits made by the American Rescue Plan Act.
Transfer price adjustments don’t necessarily increase import duty costs
Importers should consider transfer-pricing arrangements in advance, based on the totality of the circumstances, to assess any potential refund of duties on adjusted prices to imported goods.
IRS explains employee retention credit rules for first half of 2021
The IRS issued guidance on how to claim the employee retention credit for the first and second quarters of 2021.
IRS refunding taxes overpaid on unemployment benefits
To help taxpayers who might otherwise have been required to file amended income tax returns, the IRS announced that it will automatically issue to eligible taxpayers refunds of income tax paid on 2020 unemployment benefits.
A conversation on future-proofing CPA firms
The experts on the AICPA Tax Practice Management Committee discuss the technology updates that helped their firms endure through COVID-19 and beyond.
Draft employer’s payroll tax return incorporates ARPA changes
A proposed new version of Form 941, Employer’s Quarterly Federal Tax Return, reflects relief provisions of the American Rescue Plan Act.
COBRA premium assistance credit under ARPA clarified
The IRS answered questions concerning COBRA continuation coverage premium assistance and the corresponding tax credit that employers, plan administrators, and insurers may claim under the American Rescue Plan Act.
Taxpayers deserve pandemic penalty relief, AICPA says
In a letter to the IRS and Treasury, the AICPA recommended, in light of the ongoing COVID-19 pandemic, that the IRS implement fair, reasonable and practical penalty relief measures, including targeted relief from both the underpayment-of-estimated-tax penalty and the late-payment penalty for the 2020 tax year.
IRS clarifies pandemic relief for dependent care assistance programs
Dependent care assistance program benefits carried over or available during an extended claims period under special temporary COVID-19 relief provisions retain their status as excludable from employees’ gross income and wages, the IRS explains in a notice.
Casualty losses related to COVID-19 when there are no physical losses
The COVID-19 pandemic brings taxpayers into uncharted territory with regard to casualty losses without physical damage but where there is still an undeniable impact to the business, especially where property values are permanently reduced due to the pandemic.
