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). Under current law, attorneys who work on a contingency-fee basis generally must wait to deduct case expenses (costs of discovery, depositions, expert witness testimony, etc.) [...]
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 in the Infrastructure legislation that affects many businesses is the termination of the Employee Retention Credit (ERC) RETROACTIVE to September 30, 2021. Thus, the ERC [...]
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. The notice clarifies that wages paid to a majority owner (one who directly or indirectly owns more than 50% of the entity), are not eligible [...]
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, many borrowers had expressed concerns that the loan necessity questionnaire was not reflective on Congress’s intent when the PPP program rolled out in March of [...]
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 to comply with individual insurance mandates. The NIIT was technically not enacted as part of the ACA, but if the ACA was invalidated, the NIIT [...]
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 round PPP loans (up through May 31, 2021). The new law also gives the Small Business Administration an additional 30 days (until June 30) to authorize [...]
Masks, hand sanitizer, wipes, and other personal protective equipment now count as medical expenses
The IRS just announced that personal protective equipment will be treated as medical expenses if they were purchased primarily for the purpose of preventing the spread of COVID-19. Thus, masks, hand sanitizer, and sanitizing wipes used to help stop the spread of the Coronavirus can be deducted as medical expenses as long as the taxpayer’s total medical expenses exceed 7.5% of adjusted gross income. Alternatively, such amounts can be reimbursed by Health Savings Accounts, Health Flexible Spending Arrangements, and Archer [...]
Kansas and Missouri Announce That Individuals Have Until May 17th to File and Pay 2020 Taxes
Both Kansas and Missouri have announced they will follow the IRS extension until May 17, 2021 to file and pay 2020 taxes for individuals. More details about the extension should be coming from the Internal Revenue Service, Kansas, and Missouri. Also, the City of Kansas City has not yet made an announcement regarding its plans for the April 15th deadline. Please be aware that we will continue to complete and file returns as soon as possible. Payments will not need [...]
Tax Day Extended Until May 17th for Individuals to Give Flexibility to File and Pay 2020 Taxes
The IRS just announced that the April 15th tax filing deadline for both filing tax returns and making payments for 2020 will automatically be moved to Monday, May 17th this year for individuals. Similar to the extension in 2020 due to the pandemic, we will wait for the details to come from the Internal Revenue Service and determine what states and cities will do regarding the April 15th deadline. Please be aware that we will continue to complete and file [...]
Congress Passes American Rescue Plan Act of 2021
This afternoon, Wednesday, March 10th, Congress passed legislation designed as another stimulus to help those in need as a result of the COVID-19 pandemic. The American Rescue Plan Act of 2021 is a $1.9 trillion economic stimulus package designed to provide additional relief to address the continued impact of COVID-19 on the economy, public health, state and local governments, individuals, and businesses. The legislation now awaits President Biden’s signature. MWB's tax partner, Julie Welch, was interviewed by Fox 4's Dave [...]
Employers note – Kansas Governor Laura Kelley Issues Executive Order for Withholding on Telecommuters
States have been struggling with how to deal with telecommuters as a result of the COVID-19 pandemic. This is especially interesting for employers in one state when the employee works from home in a different state. For 2020, Kansas had a temporary rule that applied from March 13, 2020 through December 31, 2020 that allowed employers to continue to withhold based on the state of the employee’s primary work location. For Kansas withholding purposes under the temporary rule, it didn’t [...]
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: Have 300 or fewer employees or meet an SBA alternative size standard (restaurants, hotels, etc. with 300 or fewer employees per location) Used or expected [...]