Two-Week Tax Nutshell 7.16.20
This week is a two-for-one special! Check out some of the tax news highlights over the last two weeks.
Next Round of Relief – What’s the Plan, People?
It’s reported both parties want to make a deal to help a still wounded nation navigate coronavirus recovery and continuing uncertainty. However, it’s expected to take a little time to sort out the details. The House released the $3 trillion HEROES Act previously and is hopeful many of its pieces will make the cut. Problem is, the Senate has been stating a desire to stay closer to a $1 trillion price tag. One does not require a PhD in mathematics to know that’s a large difference.
In a recent ISCPA taxation committee meeting with Senator Chuck Grassley (R-IA), the Senate Finance Committee Chair mentioned the following priorities for the relief package:
· Ensuring deductibility of PPP forgiveness-related expenses
· Protection of jobs
· A focus on getting kids back to school (safely)
· Expansion of the Employee Retention Credit
· Support for the travel industry (but probably not the $4k credit proposed)
One point of contention seems to be the expanded unemployment benefits of $600/week that are set to expire this month. The House supports extending these benefits, noting that millions are still jobless through no fault of their own in an uncertain economy. Grassley noted he is not in support of extending the full benefits but would consider weening people off and ensuring people who can go back to work now do so.
President Trump is still adamant a payroll cut make its way into the next round of relief. To which Senate Finance Committee Ranking Member Ron Wyden (D-OR) responded:
“A payroll tax cut would do nothing to help the 20 million workers who have lost their jobs, and little for those working significantly reduced hours. Another payroll tax cut for employers would also shower the country’s wealthiest corporations with billions of dollars. The right thing to do for families and the economy is extend supercharged unemployment benefits. They have unquestionably kept the economy afloat.”
Additional stimulus checks are being discussed as well. Stay tuned, it’s anticipated the next package will be coming soon.
Regs and Such
Everyone likes a good flowchart! The IRS created a Bipartisan Budget Act (BBA) Roadmap for Taxpayers to navigate the new partnership audit rules.
Rev. Proc. 2020-37 provides passenger auto depreciation limitations and lessee inclusions for 2020.
Qualified sick and family leave wage reporting under the Families First Coronavirus Response Act (FFCRA) is explained in Notice 2020-54. This will give employees who are also self-employed information needed to properly claim qualified sick or family leave equivalent credits.
TCJA’s GILTI and FDII regs were recently finalized containing revisions to the proposed regs issued in early 2019.
Final regs reinstate PTIN annual user fees for tax return preparers. This one poetically dropped on tax day.
Has Sesame Street’s Count von Count joined the IRS? I wouldn’t be opposed, I always thought he was pretty cool, tbh. I also am not disappointed with the arrival of new partnership schedules K-2 and K-3 coming in 2021 that will standardize the reporting of international information currently found on Schedule K-1.
Foreign reporting on Schedule K-1 is inconsistent and frequently requires partners to reach out to partnerships for more information. This is a move in the right direction, in my little opinion. And never fear, if this doesn’t pertain to your normal batch of returns the IRS reassures, “The proposed changes would not affect domestic partnerships with no items of international tax relevance.”
This is a great article on different types of tax guidance and recommendations for the Treasury and IRS to consider regarding ever-changing FAQs.
Should I get back to a regular tax news recap on a set day (such as a Friday)? Probably
Will I get back to a set schedule? Potentially
Either way, I'm staying up-to-date and will keep you in the loop!
Thanks for reading.
Information provided is for educational purposes only and not to be used as tax advice. Please contact your tax and business advisors to review your unique situation.