Weekly Update – May 5th, 2023 – Happy Cinco de Mayo
Today, Cinco de Mayo actually marks the anniversary of the 1862 victory by Mexican troops over invading French forces at the Battle of Puebla. The triumph over the better equipped and more numerous French troops was an enormous emotional boost for the Mexican soldiers led by Gen. Ignacio Zaragoza. Today Mexican American’s get together with friends and family to celebrate. Enjoy!
Home sweet home! No matter how great a time we have, or how comfortable our stay, or wonderful it is to see friends during a vacation, there no place like home. I took a great after-tax-season vacation skiing, hiking and visiting friends and family first in Salt Lake City, Utah and then in Oceanside and San Diego CA. I am happy to share photos of local wildlife and plants which I took while on my daily (5 mile) walks in California (check out last week’s blog for my ski photos)…
We had a great trip, extended by one day due to the stormy weather in NYC. The airlines put us up in a local hotel with a great gym, extra large pool and hot tub; here’s a shot of my remote office with a view of the San Diego Marina…
I am looking forward to relaxing this weekend with no plans other than a beach walk and a “late wake-up call”. I hope you have plans to celebrate Cinco de Mayo and have a relaxing weekend.
WEEKLY TAKE AWAY
Often when working on a project we get totally immersed in the detail, creating ideas, solutions, scenarios, and tax savings projections. We then schedule an exit appointment with our client to discuss highlights, open items, and/or questions. During our latest office huddle we discussed our exit appointment approach and realized it needed some tweaking. Many times our frame of mind is so result focused that we just launch into our questions or talking points without a proper introduction. Well meaning, but possibly disconcerting to our clients. We have adopted a new phrase “Pause, time for a temperature check” so we take time to bring our client up to speed with a summary of the problem or issue and then check to see that they are following along not just nodding and hearing bla, bla, bla.
TAX ISSUES/TAX PLANNING
Deadline Relief for Florida Residents and Businesses IR-2023-94
With IR-2023-94, May 2, 2023, the IRS is offering relief to any area designated by the Federal Emergency Management Agency (FEMA) as a result of tornadoes, severe storms and flooding that occurred from April 12th to 14th. This is good news for those effected by the storms; better late than never and Florida residents generally do not have state tax deadlines.
Extension Tax Returns with Balance Due not Fully Paid
Now that April 18th is a “fond” memory, it’s time to add another item to your “to do” list. For those of you who have filed timely extensions with insufficient funding, please pull together your missing documents so that the actual tax returns can be finalized and submitted. Remember the extension was an extension of time to file, not an extension for time to pay, so any balance due will continue to accrue interest (don’t ask how much), let’s just get those returns finalized and submitted.
Extended Tax Returns Still Need to be Filed
The extended due date for individual tax returns of April 18th has come and gone. It is now time to search for or request the “open items email” we sent you and start putting together those missing pieces of information. I know that the nice weather beckons you, but we would not be asking for this additional information unless we felt it would help reduce your tax liability. Remember this was an extension of time to file, not an extension of time to pay, and October 15th will be here before you know it.
ECONOMY/BANKING
JPMorgan is Purchasing Most First Republic Bank Assets
Following news that First Republic Bank was put into receivership by regulators early Monday. JPMorgan announced it had acquired “the substantial majority of assets” and assumed the deposits, insured and uninsured, of First Republic from the Federal Deposit Insurance Corporation, the independent government agency that insures deposits for bank customers. “Our government invited us and others to step up, and we did,” said JPMorgan Chase CEO Jamie Dimon. He said the deal is also a good one for his bank’s shareholders, adding to its expected earnings going forward. This makes First Republic Bank the third regional bank to be taken over by federal regulators since March and the second-largest bank failure in US history.
.25% Basis-Points Interest Rate Hike
On Wednesday the US Federal Reserve issued a statement that it was raising interest rates by .25-basis-points. According to a Reuters poll of economists a short and shallow US recession is likely this year. Conflicting news about whether this is the end of the rate hike cycle or will they raise rates again after a pause. These rates increases are affecting mortgage rates, home sales and the housing market.
A Recession May be Coming
Economists at the Federal Reserve fear a mild recession is on the way, and it could last longer than usual. Thanks to turmoil in the banking industry, recovery from the recession could take up to two years.
Weight Loss Company Jenny Craig Shuts Down Corporate Offices
As part of what is expected to be a transition to an e-commerce company, Jenny Craig notified employees that it would close its Carlsbad, California company site and end the majority of its operations at the facility on or around June 24. Its New Jersey facility is also scheduled to close at the same time.
Facebook Donated to a Group Who Fought Antitrust Legislation
A group called American Edge received a $34 million donation from Facebook as the organization campaigned against antitrust legislation.
GM Lays Off Hundreds from Product Development
GM announced it was cutting several hundred full-time contract positions to reduce costs as the automaker moves forward. The majority of those jobs were from its engineering group, which works on future car models.
Lawsuit between DeSantis, Board and Disney escalates
A board backed by Gov. Ron DeSantis said it planned to counter-sue Disney over the state’s long-running fight for control of Disney’s Florida theme park. The counter-suit will be filed in response to Disney’s own lawsuit filed against DeSantis and the board claiming retaliation for Disney speaking out against a Florida bill.
California to Allow Only Zero-Emission Trucks by 2045
California announced it would require all medium- and heavy-duty trucks operating in the state to be zero-emission by 2045. The Advanced Clean Fleets rule was approved by the California Air Resources Board and also bans the sale of internal combustion engine models by 2036. Trucks that haul in heavy areas–such as ports and warehouse districts–have until 2035 to become zero emission.
Writers Guild of America Votes to Strike
On Monday May 1st the Writers Guild of America voted 98% in favor of going on strike. More than 10,000 members would discontinue working on Tuesday May 2nd. The last strike by the union was held in 2007 and lasted for 100 days. This move could shut down production on most television shows for the near future; many we know and love like “Saturday Night Live”, “The Late Show”, “Jimmy Kimmel Live”, “The Tonight Show”, “The Daily Show”, and others. Be prepared for re-runs.
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 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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