Weekly Update-January 19th 2024 ❄️⛈️☀️☃️-What to Expect from The Tax Relief for American Families and Workers Act of 2024
What a week of crazy weather and it just started snowing again this morning. I was happy to take advantage of the extra time off on Monday as we celebrated the life and ideas Martin Luther King jr. A week of cold weather, soup and taxes as we head into our busy time of year. Last week I mentioned a planned trip to meet a friend for dim sum, it was amazing and fun to try so many different dishes. The waitress was very sweet as she brought me a fork which I politely declined – how can you eat chicken feet with a fork…
There’s always a pathway on the beach at least at the water’s edge after the tide comes in…
Remembering Martin Luther King jr. and enjoying the cold January NYC weather
Sometimes you just need a beach walk to clear your head,…
I am hoping you have great plans for the weekend and you stay warm and dry.
WEEKLY TAKE AWAY
At this time of year with so many IRS deadlines we pivot to complete one deadline as another pops up and I/we may be unclear as to whose job it is to follow-up on a request or ongoing item. I can picture sitting around a campfire roasting marshmallows while sparks fly in the wind landing on some dry leaves potentially starting an unintended fire in another spot. That’s what our December-January time is like every year. In my office I have been vowing to communicate better and to make sure we are on the same page with each other and our clients. When it works it’s great, when it doesn’t, it’s a great learning experience. As I work through tax season I will combine a few take-ways into one, and please let me know if I slip up “pause during meetings, for a temperature check and end with a list of follow-up expectations”. 🐌🛑
TAX ISSUES/TAX PLANNING
The Tax Relief for American Families and Workers Act of 2024
Next week the IRS will begin accepting 2023 personal tax returns via their e-file system and have already opened their portal for business return submissions. We question again with the currently hotly debated Tax Relief for American Families and Workers Act of 2024 is it better to extend than amend. Congress has unveiled a bipartisan tax bill that, if passed, would include retroactive provisions that may affect your 2023 tax returns. Feel free to click through to read the notes from the senate finance committee
Proposed changes include:
- Expansion of the child tax credit, including a larger refundable portion of the credit (currently $2,000 – looking to expand to $3,600)
- Election of using prior year income for determining earned income for purposes of the child tax credit
- Extension of the disaster-related personal casualty losses
- Increase in threshold reporting for forms 1099-NEC and 1099-MISC
- Deduction for research and experimental expenditures AKA IRS Code section 174 –restoring this provision would allow start-up companies to use the credits against payroll taxes, a huge help as most have losses in early years but are still liable for payroll taxes
- Extension of 100% bonus deprecation – a huge benefit for small business as they purchase and place equipment into service
- End of the employee retention credit program as well increase in due diligence requirements and penalties for ERTC promoters/material advisors – January 31, 2024 deadline to apply.
Feel free to click through this great article from AccountingToday.
IRS Form 8300 Reporting gives businesses reprieve on digital asset reporting
On Tuesday January 16, 2024, the Internal Revenue Service and the Treasury Department released IR-2024-12, related to business reporting on the digital assets they receive until regulations are issued BUT this does NOT change the requirements spelled out in Announcement 2024-4 related to the reporting of cash in excess of $10,000 received in a trade or business. “The Infrastructure Investment and Jobs Act revised the rules that require taxpayers that are engaged in a trade or business to report receiving cash of more than $10,000 by considering digital assets to be cash. Announcement 2024-4 provides transitional guidance as Treasury and the IRS implement the new provisions. This particular provision requires Treasury and the IRS to issue regulations before it goes into effect.
It is important to note, the announcement does not alter the rules that were in effect before the infrastructure law for cash received in the course of a trade or business. Small businesses should be aware of the rules that guide the reporting of cash (or equivalents) payments in excess of $10,000 received. IRS specific requirements and guidance require the filing of : Form 8300, “Report of Cash Payments over $10,000 Received in a Trade or Business,” within 15 days of receiving the cash.
For more on this feel free to click through this great article from AccountingToday.
US Small Business Sentiment Up, But Labor, Inflation Worries Persist
U.S. small business sentiment rose for the first time in five months in December, a survey published on Tuesday showed, but hiring costs and ongoing concerns around inflation continue to sour business owners’ confidence.
Navigating Tomorrow’s Market: E-Commerce Trends & Projections for 2024
Dani Nadel believes e-commerce growth will be more significant in 2024, and will be realized mid-year as economic strains continue to shape consumer behavior for months ahead. Several additional factors will, together, set the stage for disruption and reshape the commerce landscape.
Employee or Independent Contractor? A Guide to the New Rule
The U.S. Department of Labor has published a final rule, Employee or Independent Contractor Classification Under the Fair Labor Standards Act, to provide guidance on whether a worker is an employee or independent contractor under the FLSA.
At Least Five States Are Considering Requiring Full Minimum Wages for Tip Earners this Year
Only seven states currently bar “subminimum” pay for tipped workers like bartenders and restaurant servers, but activists see 2024 as ripe to expand the tally to as many as 20.
Inflation Ticked Up to 3.4% in December Thanks in Part to Outsized Housing Costs
As price growth continues to moderate, consumers are still adapting to a new normal. Inflation climbed from 3.1% to 3.4% in December, a sign the Federal Reserve will continue to have to wrestle consumer price growth down to its desired 2% level.
- 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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