About Cara Smith

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So far Cara Smith has created 24 blog entries.

Repaying Deferred Self-Employment and Household Employment Tax

The IRS has sent reminder notices for the upcoming due date for payments of deferred self-employment from 2020 tax returns. Payments of the deferred tax are due half by the end of 2021 and the remaining half by the end of 2022. Background:  The CARES Act created a provision allowing employers, including household employers and [...]

By |2021-12-27T09:19:53-06:00December 23rd, 2021|COVID-19, Tax|Comments Off on Repaying Deferred Self-Employment and Household Employment Tax

Attention Contingency-Fee Attorneys

Attention Attorneys who work on a contingency fee basis. ACTION ITEM – For cash-basis contingency-fee attorneys, consider delaying payment of case expenses until January 1, 2022. One of the provisions in the proposed Build Back Better legislation would allow case expenses to be deducted currently (rather than treating such amounts as loans for tax purposes).  [...]

By |2021-11-18T12:02:17-06:00November 18th, 2021|Tax|Comments Off on Attention Contingency-Fee Attorneys

Infrastructure bill headed to President for enactment eliminates Employee Retention Credit

After several stalls in the House, the $1.2 trillion infrastructure bill was passed by Congress very late Friday night (November 5, 2021) and now awaits the President’s signature.  While there are relatively few tax-related provisions in this legislation, more extensive changes are included in the Build Back Better Act (the Reconciliation Bill). One tax provision [...]

By |2021-11-08T16:00:10-06:00November 8th, 2021|Tax|Comments Off on Infrastructure bill headed to President for enactment eliminates Employee Retention Credit

New Guidance on the Employee Retention Credit Benefits Many Companies

In the recently issued Notice 2021-49 (August 4, 2021), the IRS provides guidance for employers claiming the Employee Retention Credit (ERC). Included in the IRS notice is guidance on the definition of related parties’ wages for purposes of claiming the ERC and whether the wages paid to shareholders and their spouses qualify for the credit. [...]

By |2021-08-11T09:06:06-06:00August 11th, 2021|COVID-19, Tax|Comments Off on New Guidance on the Employee Retention Credit Benefits Many Companies

SBA drops PPP Loan Necessity Review

The SBA just informed lenders that the loan necessity review requirement for Paycheck Protection Program (PPP) loans of $2 million or more has been eliminated for both for-profit and not-for-profit borrowers.  Additionally, borrowers are no longer required to submit a loan necessity questionnaire that had been previously requested by the SBA.  Leading up to this, [...]

By |2021-07-15T08:32:23-06:00July 15th, 2021|COVID-19|Comments Off on SBA drops PPP Loan Necessity Review

Supreme Court dismisses ACA Challenge

On Thursday, June 17, the Supreme Court ruled the Plaintiffs' challenge on the Affordable Care Act's (ACA) constitutionality did not have standing, and the case was dismissed.  At the heart of the case was the issue of whether the 3.8% Net Investment Income Tax (NIIT) could be justified after Congress eliminated the penalty for failure [...]

By |2021-06-18T09:33:06-06:00June 18th, 2021|Tax|Comments Off on Supreme Court dismisses ACA Challenge

PPP Deadline Extended through May 31, 2021

On the eve of the deadline, President Biden signed the Paycheck Protection Program (PPP) Extension Act of 2021.  The deadline for loan applications for forgivable loans under the Paycheck Protection Program was initially set to expire on March 31, 2021.  The extension provides an additional two months for borrowers to apply for first and second [...]

By |2021-03-31T15:40:24-06:00March 31st, 2021|COVID-19, Tax|Comments Off on PPP Deadline Extended through May 31, 2021

PPP Round 2

The second round of Paycheck Protection Program (PPP) funding is ready to be released.  The Consolidated Appropriations Act of 2021 allocated $284 billion to the PPP program allowing second draws for hardest hit businesses.  It is expected the SBA will begin taking application next week (January 11-15).  Qualifications for a second draw include borrowers that: [...]

By |2021-01-08T15:51:32-06:00January 8th, 2021|COVID-19, Tax|Comments Off on PPP Round 2

IRS Disallows 2020 Expenses for PPP Loans Forgiven in 2021

As with much of what has been issued regarding PPP loans and ever-changing guidance, the following analysis of deductibility is subject to legislative change.  At the end of April, the IRS issued guidance precluding deductions for expenses paid with PPP funds.  The Small Business Expense Protection Act would reverse that and allow the expenses to [...]

By |2020-11-23T12:19:00-06:00November 23rd, 2020|COVID-19, Tax|Comments Off on IRS Disallows 2020 Expenses for PPP Loans Forgiven in 2021

SBA issues 23 FAQs on PPP Loan Forgiveness

In anticipation of PPP borrowers beginning to file applications for PPP loan forgiveness, the SBA issued 23 new FAQs. While they do not cover all needed guidance, answers were provided in the following categories: General Payroll costs Nonpayroll costs Wage and headcount reductions Meanwhile, legislation has been introduced to expand and extend the PPP loans. [...]

By |2020-08-06T15:49:01-06:00August 6th, 2020|COVID-19, Tax|Comments Off on SBA issues 23 FAQs on PPP Loan Forgiveness
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