Itemized Deductions Series – Part 5: Contributions & Charitable Giving
Contributions First, let’s look at what type of organization qualifies to receive deductible contributions. The organization has to be a domestic nonprofit that operates for religious, scientific, charitable, or other qualifying purposes. A trust, community foundation or other organizations could qualify as well. If you don’t know and want to ensure your contribution qualifies, research…
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Corporate Transparency Act Deadline Approaching
The Corporate Transparency Act (CTA) took effect on January 1, 2024. Entities formed prior to January 1, 2024, are required to file a beneficial owner information (BOI) report to the Financial Crimes Enforcement Agency (FINCEN) by January 1, 2025. If the entity is created or registered to do business after January 1, 2024, the initial…
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IRS Advances Employee Retention Credit Claims: More Payments Move to Processing
On August 8th, 2024, the Internal Revenue Service announced it is accelerating more payments and continuing compliance work on outstanding ERC claims. It’s estimated between that 10% and 20% of the unprocessed ERC claims show a low risk of noncompliance. For those with no eligibility warning signs that were received prior to last fall’s moratorium,…
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Biden’s Budget and Potential 2nd Term Tax Legislation
Soon after The President’s State of the Union Address, the proposed fiscal year 2025 budget was released. This outlines how the administration would implement the President’s tax policy, indicating a gross tax hike of approximately $5.3 trillion from 2024 to 2034. Notable Provisions: Increased Taxes on High Earners: Increase income taxes for individuals earning more…
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New Options for Leftover 529 Plan Funds – Convert to Roth IRA
The SECURE 2.0 Act of 2022 introduces a noteworthy change: a special rule allowing transfers from 529 plans to Roth IRAs. Effective in 2024, this rule enables unused college savings to shift to tax and penalty-free retirement accounts. Why This Matters Before this change, if a 529 plan wasn’t fully used for education, options were…
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Jefferson County & Alabama Property Tax Overview
Valuation Process Jefferson County recently sent out valuation notices for properties with an increase in value or change in boundary. The county utilizes a mass appraisal process set forth by the Alabama Department of Revenue. When a sale within a neighborhood indicates an increase or decrease, valuations are adjusted. If you received a notice and…
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Guidance Provided for Overtime Pay Exempt from Alabama Income Tax
In June, we reported that the Alabama Legislature passed HB217, which eliminates the 5% withholding tax on overtime from January 2024 through June 2025. Employers are subject to reporting for 2023, 2024 and 2025. Now, the Alabama Department of Revenue has published reporting guidance and FAQs. Historical 2023 overtime data must be submitted by January…
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Employee Retention Credit Refund Update
Our last “Where’s My ERC Refund” update was published almost a year ago in June 2022. Since then, many outstanding ERC refunds have been processed and paid by the IRS with interest, while businesses continue to file additional ERC refund claims. Many of our clients have received a refund for some quarters, but not others,…
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IRS Reminds Employers of Penalty Relief Related to Claims for Employee Retention Credit
A couple of weeks ago we covered the IRS backlog of amended payroll tax returns (941X) for employee retention credits. Now, the Treasury and IRS have responded to requests from taxpayers for relief from penalties with IR-2022-89.
Where’s my ERC refund?
Many businesses filed for employee retention credits. Unfortunately, the IRS has a staggering backlog of Form 941’s to process as a result of ERC filings along with normal quarterly filings.