Weekly Update – April 28th, 2023
As much as I love non-stop work, deadline pressures and stress, a week of vacation first skiing in amazing conditions with my kids and longtime friends then on to southern California for a long weekend is just what I needed. On Tuesday morning we carved “first tracks” yes, fresh powder in April at Snowbird mountain in Utah. I followed my pre-weekly take away and didn’t “overdo it”. I even joined morning yoga classes to stretch, so no ski injuries! We are still on vacation until Sunday and have been enjoying the west coast with our other daughter, her boyfriend and their dog Sampson who seemed to recognize us when they met us at the airport.
This is the view from the car on our way to the airport.
This is the view from the car on our way from the airport, these purple flowers grow all along the highway.
I am posting this blog in eastern standard time so no california sunrise to share yet, but I am looking forward to a walk on the beach in a few hours, and a beautiful southern California weekend with west coast family and friends and hope you have some great plans too.
WEEKLY TAKE AWAY
Even though I was excited to see and spend time with my kids I was so nervous about skiing again after my injury 2 years ago and hip replacement surgery last June that I actually considered cancelling our plans. I vowed to approach the mountain with caution. I passed narrow mogul studded double black diamond trails that I have taken during our prior trips here and had a great time just skiing the groomed trails. I had “trained” for this trip, continuing my daily workouts and physical therapy; eventually after a few warm up runs I was able to relax and forget my hip entirely. So double take-away, don’t over do it and make sure to stay in shape to enjoy vacations and visits with your kids.
TAX ISSUES/TAX PLANNING
New Ruling by US Tax Court May Offer an Opportunity For Penalty Refund
The recent decision by the United States Tax Court in the case of Farhy v. CIR (April 3, 2023) may allow taxpayers who recently paid penalties in connection with IRS Forms 5471, 5472, 8938, or 926 to obtain refunds for these penalties. The court has ruled that the IRS can no longer administratively assess and collect penalties under Internal Revenue Code section 6038(b) for the failure to timely file information returns with respect to foreign business entities controlled by U.S. persons. The Tax Court’s opinion does not affect the obligation of taxpayers described in section 6038(a) to timely file the information returns, and taxpayers who fail to do so could still be liable for the penalties.
Tax-exempt Organization’s Annual Filing Deadline is Coming Up
The annual filing due date for certain returns filed by tax-exempt organizations is normally by the 15th day of the 5th month after the end of an organization’s accounting period. Tax-exempt organizations can request a six-month extension by filing Form 8868. The extension does not extend the time for paying tax. These returns are:
- Form 990-series annual information returns (Forms 990, 990-EZ, 990-PF)
- Form 990-N, Electronic Notice (e-Postcard) for Tax-Exempt Organizations Not Required to File Form 990 or Form 990-EZ
- Form 990-T, Exempt Organization Business Income Tax Return (other than certain trusts)
- Form 4720, Return of Certain Excise Taxes Under Chapters 41 and 42 of the Internal Revenue Code
2023 Estimated Tax Payments
While many of you are still reeling from large or unexpected balance due payments submitted with your tax return and/or extension it is important to remember that your 2023 estimated tax payments are still due on:
- April 18th
- June 15th
- September 15th
- January 15th 2024
We are hearing and seeing that the mutual fund payouts and capital gains from investments may have vanished during the last few weeks, and expectations from other income sources may be lower than 2022 amounts. This gives us the opportunity to tweak your quarterly estimates and work through some other planning opportunities. Remember these are estimates and are required, but the amounts are not set in stone.
Earnings Improved for Q1 2023
S&P 500’s Q1 earnings season started better than the previous two quarters, but positive earnings surprises and their magnitude are below 5-year averages. While earnings have improved, the index still shows the largest YoY decline since Q2 2020. Get a detailed report here.
Tesla Net Income Drops 20%; Revenue and Profits are Close to Expectations
Tesla’s Q1 revenue and profit were right where analysts expected them to be, but the company said that an “underutilization of new factories” stressed margins, along with other factors.
Google Scrambling as Samsung & Apple consider switching to Bing
With up to $23 billion in annual revenue at stake from Samsung and Apple contracts, Google is working on upgrading its search engine and developing a new one powered by artificial intelligence to counter the threat from AI competitors like Bing.
Disney to Lay Off Several Thousand Workers Across Divisions in Second and Largest Wave of Job Cuts
Disney is laying off several thousand employees across its divisions, including ESPN, Disney Parks, and its Experiences and Product division, as part of a plan to reduce its workforce by 7,000 employees and save $5.5 billion in costs.
Recession or Soft Landing; No Answer Yet
The question of whether the economy will experience a crash or a “soft landing” has been a concern. While a recession is considered the conventional option, a “soft landing” – a scenario where the economy cools off without tipping into full-blown recession territory – is also possible.
9 Steps to Prepare for a Possible Recession
Even if a soft landing is possible, there’s always something to be said for being prepared. Yahoo! Finance rounded up 9 steps to prepare your finances for a recession.
- 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 prior blog posts, videos and prior weekly newsletters
- Entrepreneur put together a listing of free tech resources for remote work
- The Consumer Financial Protection Bureau has warnings about COVID-related scams
- 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
- 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 here for you.
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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