Accounting News and Updates

President Trump COVID Executive Orders Signed 8/8

The President, in a swift move on Saturday, signed into law 4 new executive orders. 

 

Here is a breakdown of each order and how it may affect you:

 

Executive Order: Payroll Tax Holiday 

The new executive order shows business owners now have the ability to defer the payroll taxes owed for any compensation and wages that occurred from 9/1 - 12/31.  This payroll tax holiday is scheduled to still be owed taxes but just delayed.  However, there has been a mention of potentially offering Payroll Tax Forgiveness on this deferral, but nothing is set in stone. 

Extending Enhanced Unemployment Benefits

The unemployment benefits of $600/week expired last week. However, a new executive order came into play to extend the additional unemployment to $400/week. The federal government will be taking on 75% of the cost and the states will take on the remaining costs of 25%. 

 

Minimizing Ability To Evict Residents/Homeowners

Renters and homeowners can stay in their homes as a protection from Eviction. “It is the policy of the United States to minimize, to the greatest extent possible, residential evictions and foreclosures during the ongoing COVID-19 national emergency.”

 

Student Loan Borrowers Relief

The final executive order now extends the student loan interest rate of 0% to the end of the year. 

All of these changes come on the last day the Paycheck Protection Program was extended to due to the Flexibility Act.  As we enter into the last half of the year, there are key strategies and legislative that you need to make sure you are taking advantage of and budgeting for accordingly. Go ahead and schedule a time today to speak with me here as my calendar is already filling up this week. 

J.D. Frost & Company has achieved positive results for its clients, but the successes of our top clients are not typical. Because past performance is not a predictor of future success, you may have more or less success depending on many factors, including your background, experience, work ethic, client base, and market forces. Additionally, at times we may discuss the law or new and pending legislation.  Please know our understanding of it is constantly changing, and you cannot and should not rely upon these communications for legal, financial, or accounting advice.

The IRS is doing its best to conduct business as usual. The IRS has a backlog of correspondence and paper tax returns to process.  

 

1. IRS.gov is the first place to answer your questions

IRS plans to provide online tools allowing taxpayers access to their accounts.  Many taxpayers are trying to call the IRS (and not getting an answer) to get stimulus payment answers or up dates, please visit the IRS’s coronavirus webpage.

 

2. Live assistance is very limited

Live assistance is minimal since the IRS is practicing social distancing. Alternatively, many IRS hotlines are beginning to be operational includes most service and all compliance hotlines (i.e., automated under reporter, collection functions, correspondence exams, etc.). 

 

3. The IRS will be hard to reach, even after the pandemic is over

The IRS will be hard to reach when the pandemic is over, due to social distancing and correspondence backlogs. The IRS is planning to provide electronic means to send documents by e-mail or by fax. 

 

4. You can put that audit on hold — unless it deals with a refund hold situation

The People First Initiative temporarily suspends new audits unless there is a refund.  Taxpayers with questionable refunds (e.g., Earned Income Tax Credit returns, returns with highly questionable items, suspected identity theft returns, wage verification issues) will likely see IRS filing filters stopping their refunds until the taxpayer can verify the return.

 

5. If you owe back taxes, you have a temporary reprieve

The IRS is giving a temporary reprieve if you owe back taxes.  The IRS collections enforcement is halted through July 15. The IRS will begin collections enforcement in the near future. Taxpayers can go to the IRS website and use the Online Payment Agreement tool to check their installment payment plan and make online payments.

 

6. IRS will not require your monthly installment agreement payment

The IRS suspended collecting installment payments via paper checks from April 1 to July 15. After July 15, the IRS will resume collecting installment payments by check and enforcing the installment agreements.  If you receive an IRS installment agreement, default notice for lack of payment call IRS or your tax advisor immediately.  You must respond to the IRS notice as soon as possible and do not wait. The notice is time-sensitive.

 

7. IRS Transcripts are usually your best method to answer to account-related questions

The account transcripts are the best method to follow up on correspondence, balance due, and status of refunds and amended tax returns.  The taxpayer can use the IRS online tool to get transcripts.

 

8. TAS can be reached if you have a hardship — but you must call your local office

Taxpayers with financial hardships can call and ask for hardship workarounds by calling the Taxpayer Advocate Services by contacting their local advocate.  Go to the https://www.irs.gov/advocate/local-taxpayer-advocate to locate an office in your area.

 

9. The IRS is still processing tax returns and it is best to file as soon as possible

The IRS is still processing e-filed tax returns.  The IRS is starting to process paper tax returns with the most current year first. 

10. IRS tax collectors will not grab the stimulus payment to pay past tax debt

To find out more details or to read the full article click here.

 

Source:  Jim Buttonow, Accounting Today

News and Updates from the IRS

Track Your Refund from the IRS

Track Your Amended Return

An update on the Complete Reopening of the IRS from our Tax Compliance Manager, Mitchell Desbiens

To protect the public and employees, and in compliance with orders of local health authorities around the country, certain IRS services such as live assistance on telephones, processing paper tax returns and responding to correspondence continue to be extremely limited. While some volunteer tax preparation sites are operating at a reduced capacity, most remain closed until further notice.  The IRS is experiencing delays in processing paper tax returns due to limited staffing. If you already filed a paper return, the IRS will process it in the order they received it. The IRS discourages taxpayer’s from filing a second tax return or contacting the IRS about the status of their return. The IRS Practitioner Priority Service representatives advise Tax Practitioners to call IRS after August 1, 2020 to check on the status of their client paper tax returns filed and correspondence.  Accordingly, the IRS has a backlog and processing times will be longer than usual.

Find out more details on the IRS Reopening Here

Phone:          423-486-9300

Address:      1413 Chestnut Street, Suite 401

                     Chattanooga, TN 37402

Contact us: info@frostcpas.com

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