Weekly Digests

Over the weekend, several countries reported their first cases of the new Omicron variant of the COVID-19 virus. While little is known about the new variant, genetic sequencing indicates it has at least 30 mutations on the spike protein, which it uses to bind to human cells, so it could be even more easily spread than the Delta variant. In response to the uncertainty, Israel has banned all foreigners from entry, while the U.S. joins other nations in restricting entry of people who have spent time recently in countries in southern Africa. The U.S. administration is in discussions with scientists and vaccine manufacturers to adapt vaccines and therapeutics if needed.

Despite fears of virus outbreaks, I am hoping that many of you were able to spend time with family and friends over this holiday weekend.  I was grateful that plans to spend an extended thanksgiving weekend in Ohio and Michigan worked out.

Great timing, Jessie deplaned a few gates down, just minutes after we landed at Detroit Airport (DTW), then onto spending the day helping with thanksgiving dinner prep and watching the Lions vs Bears.  My children were impressed with my knowledge of football strategy; something else to be grateful for, attending and cheering on my winning high school football team!

Emily is in a one year pain management fellowship at the University of Toledo Medical Center, so I was also able to have a treatment for my recently discovered arthritic hip.  I was a bit nervous but very hopeful that I will be back running on the beach again in a few weeks.  The surgical team was wonderful and granted my wish for Emily to hold my hand as her program director injected the meds.  Believe it or not, it was my husband David who asked them to pose for photos.

No trip to Michigan in November is complete without at least one snow flurry, and freezing weather.

I am hoping that many of you were able to spend time with family and friends over this holiday weekend and that you, your friends and family stay safe and healthy.

THE AMERICAN RECOVERY PLAN ACT (ARPA)

Monthly Advance Child Tax Credit Payments

The deadline to opt out of the December advance Child Tax Credit payment was midnight on Monday, November 29. According to Question H1 in the IRS FAQs, in January, the IRS will send out Letter 6419 with the total amount of advance payments received. The information on this letter will be needed to file your 2021 tax return, where you’ll reconcile the total amount of payments received in 2021 with the amount you can claim on your tax return. Please make sure to look for and retain this and other tax notices that should be arriving shortly.

Economic Injury Disaster Loans (EIDL)

The SBA recently announced updated guidance for the EIDL program. Applications will be accepted through December 31, 2021 and will be processed until all funds have been exhausted. Applicants are strongly urged to apply by December 10, 2021 to ensure adequate processing time. December 31 is also the deadline for submitting review reconsideration and appeal requests as long as the request is received within six months of the date of decline for reconsideration or within 30 days of the date of decline for appeals. Check out the SBA news release for updates on the program and application instructions.

Please remember that this is a loan, that will need to be paid back.  When considering to take on more debt it is advisable to consider the following:

• Update your business plan
• Reevaluate your personal and business goals
• Will funding be used for new or expanded products/services
• Return on investment
• Staff retention, training and appreciation

TAX MATTERS

Infrastructure Investment and Jobs Act

The Infrastructure Investment and Jobs Act (H.R.3684) was signed into law by President Biden on on November 15, 2021, contains several tax provisions. Here are a few of those provisions:

• Cryptocurrency reporting requirements will be expanded to stem underreporting of cryptocurrency transactions.
• The Employee Retention Credit has been eliminated for wages paid after September 30, 2021.
• The relaxation of minimum funding requirements for employer-sponsored retirement plans has been further extended
• Some disaster-related tax deadlines are extended.
• The types of tax deadlines that are extended due to service in a combat zone are expanded.

Because the Employee Retention Credit was eliminated after the fourth quarter began, there is some concern about the retroactive application of the end of the program. However, it appears that employers are currently more interested in hiring than in laying off employees.

Build Back Better Act

As the Build Back Better Act (H.R.5376) makes its way through Congress, tax provisions in the bill continue to be debated. Among the possible tax impacts are the following:

• The expanded child tax credit has been extended through 2022.
• Changes to the earned income tax credit from ARPA have been extended through 2022.
• The deduction cap on state and local income taxes would be raised from $10,000 to $80,000.
• Large corporations that report over $1 billion in profits would be subject to a 15% minimum tax.
• A refundable income tax credit of up to $8,500 for the purchase of qualified electric plug-in vehicles.

At present, this bill has only been passed by the House. The Senate aims to pass this by Christmas, but it is likely that changes will be made to get enough votes from Democrats to pass it.

IRS Form 6475: 2021 Stimulus Payment

The IRS has created form 6475 which will provide you with your 2021 stimulus payment.  We will be asked to reconcile your eligible amount with the advance payments you may have received during mid-2021.  This is a similar process with what we were asked to do when submitting our 2020 tax returns.

IRS On-Line Services

The IRS will be requiring anyone who wants to access online services such as the Child Tax Credit Update Portal or their online IRS account to log in using an ID.me account by the summer of 2022. Taxpayers with existing non-ID.me log in credentials can continue to use the old system, but will have to create a new ID.me log in to access IRS services after the change. This change is being made to ensure that access to taxpayer information is only available to the correct person.

THE GREAT REASSESSMENT

The pandemic has inspired many people to reconsider their current work situations. But before turning in that resignation letter, here are ten things to do before you quit your current job. For example, make sure you understand why you want to resign. Are you resigning because you’re unhappy with your current situation, or are there better opportunities elsewhere? Have a career path in mind. Try to keep the big picture in mind before you quit – it’s not enough to just have another job lined up.

Entrepreneurs tend to face burnout and mental health challenges at a higher rate than others. This profile on CNBC shows how the founder of UrbanStems conquered burnout and created a healthier, more balanced life. His strategies include meeting with an executive coach and a fitness coach, and daily meditation.  I can certainly understand the importance of taking some “me time” everyday, and have been doing so for years. The remote work environment has enabled many to repurpose that commuting time for exercise, family time or pursuing hobbies.

ECONOMY

The U.S. economy shows signs of accelerating into the end of the year. Household spending for November rose 1.3% compared to October, and is increasing at a faster rate than inflation, even with inflation hitting a three-decade high. Jobless claims, a proxy for layoffs, fell to 199,000, the lowest weekly level for a year. Manufacturers still face higher material and shipping costs plus shipping delays, but there are signs that the supply chain problems are beginning to abate. As companies continue to struggle to attract enough workers, many are investing in machinery and technology to increase productivity.

Even though consumers are spending at an accelerated clip, a new poll from Gallup found that the economic worries of Americans are at a pandemic high. For 26% of respondents, an economic-related concern is the top problem for the country. This is the first time since January 2017 that a double-digit percentage of Americans have cited the economy as the most important problem facing the U.S. However, this is still much lower than the level of economic concern in 2009, when 86% cited the economy as a major problem, according to Gallup data going back to 1991.

GENERAL RESOURCES

• IRS resources for stimulus payments:
  • Use the Get My Payment tool to check on EIP payment status
  • Eligibility and general information about Economic Impact Payments
  • A list of frequently asked questions for stimulus payments
• IRS information about the Advance Child Tax Credit Payments
  • Portal to update information
  • A list of frequently asked questions on the advance Child Tax Credit Payments
• The best source for up-to-date and accurate health information is the Center for Disease Control (CDC)
• Our Covid-19 Resource Center with relevant blog posts, videos and prior weekly newsletters
• Payroll, HR and benefits company Gusto has put together An Employer’s Guide to Navigating the Coronavirus
• Accounting Today has a special page for articles on COVID-19
• Intuit QuickBooks has a dedicated page to help small businesses
• Entrepreneur put together a listing of free tech resources for remote work
• The Consumer Financial Protection Bureau has warnings about COVID-related scams
• Fast Company has a listing of the best productivity apps for 2020
• The New York Times has an online newsletter on K-12 and higher education
• The Wall Street Journal has a collection of articles on education
• The Louvre has digitized 482,000 artworks from its collection
• PC Magazine explains how to carry your vaccination card on your phone
• How to create a strong password

We sincerely hope that you and your family are well and remain well. If you have any questions or concerns, don’t hesitate to reach out to us. We are all in this together!