The 2021 1040 tax return includes a question regarding virtual currency transactions during the calendar year. This question must be answered either yes or no. If the return is filed leaving the box blank, the return will be rejected and a new one must be filed.
BHT&D Certified Public Accountants Blog
In an effort to capture unreported income flowing through third-party settlement organizations (TPSOs) such as Amazon, PayPal/Venmo, card payment processors and other marketplaces, the IRS requires these organizations to report payments made to sellers through their platforms on Form 1099-K.
Early in 2021, Congress passed the American Rescue Plan, which included a provision that increased the child tax credit amount and upped the age limit of eligible children. Historically, the credit was $2,000 per eligible child under age 17. For the 2021 tax year the American Rescue Plan increased the credit to $3,000 for each child under age 18 and to $3,600 for children under age 6 at the end of the year.
The American Rescue Plan Act (ARPA) expanded the Child Tax Credit for tax year 2021 only, allowing families to receive advance payments instead of taking the full credit on their 2021 tax return. The goal of increasing the credit, along with monthly payments, is to help families that have struggled during the COVID-19 pandemic and lessen child poverty in the U.S.
Beginning July 15, the IRS will start issuing monthly advance payments to families based on their 2020 or 2019 tax return.
To help trades and businesses retain employees and keep them employed during the COVID-19 crisis, the Coronavirus Aid, Relief, and Economic Security (CARES) Act created the Employee Retention Credit for 2020. As part of the Consolidated Appropriations Act, 2021 (CCA), the credit has been extended through December 2021.
The credit is actually a government-sponsored program to keep workers employed and is funded by providing qualifying employers with a refundable credit against certain employment taxes equal to 70% (up from 50% prior to 2021) of the qualified wages that an eligible employer pays to employees after March 12, 2020, and before January 1, 2022. (Before the extension, the credit ended on December 31, 2020.)
While it is our desire to meet face-to-face, we must follow necessary safety protocols. As Federal or State guidelines change, we will adjust accordingly, in the best interest of the health our staff and visitors.
Here are a couple quick updates on changes to 1099 non-employee compensation reporting and delay of Michigan minimum wage increase. Please note important filing dates and related penalties:
Section 139 of the Internal Revenue Code excludes from a taxpayer’s gross income certain payment to individuals to reimburse or pay for expenses related to a “qualified disaster”. Covid-19 is a federally declared disaster.
On June 19th, 2020 the IRS published the final revised Form 941 that will be used for the remainder of 2020. The purpose of filing this quarterly form is to report to the IRS the wages subject to social security, Medicare and federal income tax withholding. This new revised form takes into account changes made by the Families First Act and the CARES Act that provided various types of payroll tax relief for employers.
The CARES ACT provides employers an alternative to the Paycheck Protection Program under the Employee Retention Credit. You can only take advantage of one or the other, but not both.
The goal of the Employee Retention Credit is to encourage employers to keep employees on payroll by offering a credit up to $5,000 per employee.