Weekly Digest – August 19th, 2022
Don’t you just love the summer, most of us don’t want to be inside cooking; even if you don’t have your own garden there are many great options at local markets and farmer’s market which enable you to chop, slice, and mix your way to an impressive and delicious spread. I am not complaining, but Raquel and I are “struggling” to decide which “garden to table” lunch to have. This week we picked berries, kale, tomatoes, various herbs (including some very beautiful and fragment basil) and those never ending cukes. I bought some fresh mozzarella and avocados at my local market and we chopped and sliced and enjoyed the summer bounty….
Remember when we were touting”60 is the new 40″? I am feeling like a new hip or knee is the “new normal” or “must have”. It seems everyone around me (even the 50 year old’s) are limping and signing up for new body parts or talking about how they had reconstructive surgery and should have done it years ago . What’s wrong or right with this picture. Are we overdoing our workouts and training or just realizing earlier on that no pain no gain is not correct. I for one am thrilled to be able to walk on the beach again this week I made it to “the first rock jetty” and back without any pain. I think it’s been at least a year since I was able to do so.
Down the mat and onto the sand…
It feels so great to have the sand under my feet again! I hope you are planning an outing this weekend to enjoy this great weather.
Weekly Take Away
We are watching and reading commentary about the IRS funding in the Inflation Reduction Act of 2022. I have received texts from fellow CPA’s with photos of legions of IRS tax auditors descending upon the American Public. In our office we acknowledge that we work with tax laws enacted to encourage certain behavior and then we document, document, document. We are not concerned about potential IRS notices, reviews or audits, as we create digital backup as the support for any deductions we recommend and use in our tax plans. In real estate its location, location, location, in tax law it’s documentation, documentation, documentation. Be proactive, but be prepared to defend your position.
TAX ISSUES/TAX PLANNING
The Inflation Reduction Act of 2022, What’s in it for Us?
Obviously for me, more studying and potentially more tax planning:
- Additional funding for the IRS over a 10 year period to be used to enhance taxpayer services, for enforcement (such as audits), for operations and support, and for business systems modernization. It is expected that over 80,000 additional IRS personnel could be hired, doubling the Service’s current workforce.
- Modification to the current cap on the payroll tax R & D Credit would permit an additional credit of up to $250,000 to be applied against the Medicare payroll tax for a total of $500,000 per year. This will be effective for tax years beginning after December 31, 2022. To qualify for the expanded credit small businesses would need to have less than $5 million of gross receipts and be less than five years old. For more on this, click through this link to an article in CPA Practice Advisor.
- A 15% minimum tax for corporations with over $1 billion in profits for any 3-year period ending prior to the current tax year will have limited impact for most businesses and does not apply to S-corporations. This will be effective for tax years beginning after December 31, 2022
- Carried interest loophole is still available for private equity funds. Want to know more, follow this link to an article in TheStreet.com.
- 1% excise tax on corporate stock buybacks occurring after December 31, 2022; this provision includes a number of exceptions.
For more, click through to the transcript of a recent AICPA podcast with Adam Schrom the director of product management at Bloomberg Tax.
IRS Announces Interest Rate Increases
The Internal Revenue Service announced this week that interest rates will increase for the calendar quarter beginning October 1. Details can be found here.
House Democrats Call for Social Security Reform
The Social Security program reached its 87th anniversary this month, and it’s been over 50 years since it’s been updated. House Democrats are trying to pass a bill that would expand the program and ensure it’s payable for years to come.
Experts Warn That a Housing Market Recession is Here
The National Association of Home Builders report that higher interest rates, lingering supply chain problems, and record home prices continue to exacerbate housing affordability challenges.
Gas Prices Continue to Fall
The average price of gas fell to $3.96 this week. It’s possible that they could keep falling, resulting in prices below $3 a gallon in much of the country before the end of the year.
Stock Futures Flat After Modest Gains
Opening another uncertain week, stock futures were flat after modest gains on Monday. Energy and financials initially dragged markets down, but later in the day, consumer staples, communication services and consumer discretionary stocks rallied.
New Data Suggests Chinese economy losing steam
China’s central bank cut interest rates on Monday as new data showed the economy slowing last month because of renewed Covid lockdowns and a deepening property downturn. Experts disagree on what this may mean for the global economy.
- IRS resources for stimulus payments:
- IRS information about 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!
If you need help with your accounting, want to create a tax minimization plan, want to discuss your business growth plan or your finances, are concerned about retirement goals or need to be held accountable for your 90 day action plan, contact us for a complimentary discovery session or an appointment to just get started.
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