{"id":11563,"date":"2021-08-19T10:25:28","date_gmt":"2021-08-19T14:25:28","guid":{"rendered":"https:\/\/aparnesscpa.com\/?p=11563"},"modified":"2021-08-19T10:23:51","modified_gmt":"2021-08-19T14:23:51","slug":"weekly-update-august-19th-2021business-update-july-28-2021","status":"publish","type":"post","link":"https:\/\/aparnesscpa.com\/weekly-update-august-19th-2021business-update-july-28-2021\/","title":{"rendered":"Weekly Update \u2013 August 19th 2021"},"content":{"rendered":"

Those COVID-19 relief programs which certainly helped keep millions of Americans and businesses afloat during the pandemic,\u00a0 have unfortunately also been a\u00a0spectacular bonanza for an array of international scam artists<\/a>, including Russian mobsters, Chinese hackers, and Nigerian scammers. An estimated $87 million to $400 billion in unemployment benefits may have been lost to fraud; at least half of that is thought to have been stolen by foreign criminals. Many took advantage of weak systems of unemployment verification in many states, which were further loosened to get financial support out quickly. Besides looting millions \u2013 or billions \u2013 of federal funds, identity thieves prevent innocent people from receiving the support they are entitled to. While the vast majority of the stolen cash is gone for good, so far the FBI has recovered $100 million, while the Secret Service has recovered $1.3 billion.<\/p>\n

We were so grateful to successfully assist our clients obtain those stimulus funds they were entitled to, while working with clients caught-up in the identity theft scams.\u00a0 You might be interested in reviewing and following recommendations in this resource I created for accountants which can be accessed through the Intuit help center here:\u00a0click through this link<\/a><\/p>\n

Of course all work and no play does not make for a happy or well balanced CPA.\u00a0 Sunday mid-morning I was thrilled to welcome my daughter Jessie and her dog Samson (pit-boxer mix)\u00a0 who arrived for a week long visit.\u00a0 What a great excuse to get out on the beach for a daily run\/walk with Samson as the rest of the family was fast asleep.\u00a0 I had already made arrangements with several of the doggie play group \u201cparents\u201d to allow us to join them for a test visit.\u00a0 Best of all I had a running buddy as I am starting back after my skiing accident\u2026<\/p>\n

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Of course he is totally sandy when we return, but he puts up with the rinse-off knowing it is a small price to pay for a romp on the beach<\/p>\n

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Now who will I miss more when they head back to Atlanta at the end of the week?\u00a0 Why my daughter Jessie of course, we stayed up late talking into the night, it\u2019s so great to have Jessie and Samson as our guests this week.<\/p>\n

THE AMERICAN RECOVERY PLAN ACT (ARPA)<\/h3>\n

Shuttered Venue Operator Grant (SVOG)<\/h4>\n

The SBA has announced that the\u00a0SVOG program will be closing to new applications<\/a>\u00a0on Friday, August 20, 2021. This program provides grants for live venue operators, promoters, arts organizations, and other businesses that were closed due to the COVID-19 pandemic. Grants equal 45% of gross earned revenue, up to a maximum of $10 million and, good news; funds are still available. This program has\u00a0 already awarded $8.4 billion in grants, and has received applications requesting a total of $12.3 billion, nearly $4 billion less than the total of $16.25 billion allocated by Congress. Later this month, the SBA will open their supplemental awards program which is 50% the original award amount. Certain applicants, who were initially rejected, are also being invited to apply for a reconsideration of their awards.<\/p>\n

Advance Child Tax Credit Payments<\/h4>\n

As a reminder, once you evaluate your situation, you might find that it is in your best interest to opt out of future payments.\u00a0 In order to do so, you must use the IRS\u00a0portal for the advance Child Tax Credit<\/a>\u00a0by the deadline for the next month\u2019s payment. Check out the\u00a0IRS FAQs<\/a>\u00a0where you\u2019ll find everything you need to know about opting out in Section J.<\/p>\n

At present, the portal only allows taxpayers to verify enrollment status, update banking information and to unenroll from payments. For more information, again, taxpayers should consult the\u00a0IRS webpage for this credit<\/a>.<\/p>\n

Paycheck Protection Program vs Employee Retention Credit<\/h4>\n

We love the initials and the balancing act:\u00a0 PPP vs ERC.\u00a0 Our firm members and I spent hours learning the finer points of the laws and then creating individual excel spread sheets to determine PPP loan forgiveness eligibility and ERC eligibility.\u00a0 As we interview our clients and then comparing salaries, eligible expenses, eligible time periods, government regulations, we are seeing that all the time was well worth it.<\/p>\n

We accounting professionals have been asking for more guidance regarding the ERC and finally last Wednesday evening we received some guidance:\u00a0 (Notice 2021-49\u00a0<\/a>and\u00a0IR-21-165<\/a>). This guidance seems to go against the intention of the last few tax bills.<\/p>\n

I am so glad that congressman Jack Bergman of Michigan sent a letter to the IRS<\/a>\u00a0\u201copposing recent guidance discriminating against business owners with families and demanding immediate action to change this misguided rule\u201d.<\/p>\n

FRAUD<\/h3>\n

Being tech savvy isn\u2019t enough to\u00a0protect against fraud<\/a>: a recent study shows that the number of individuals under the age of 20 who report being victims of cyber fraud has risen by 156% over the last three years. In contrast, fraud among the less tech-savvy generation over 60 has risen by only 112% over the same time frame. In 2020, 23,200 reports from under-21 age group were made to the FBI\u2019s Internet Complaint Center were made, with losses of $71 million. Common scams include job scams (applicants are told to purchase training), and online influencer scams (contest winners are told to pay a fee or provide banking information to receive their prize). The best way to avoid any kind of scam is to thoroughly investigate the person or company before sending them any financial information and to be wary of offers that seem too good to be true.<\/p>\n

REOPENING THE OFFICE<\/h3>\n

Tech companies may be delaying a return to the office in the face of the Delta variant, but according to recent surveys of American employees,\u00a0more than half of respondents are already back in the office<\/a>. According a recent survey, only 8 percent of employers had adopted a permanent work from home policy, and 19 percent were still planning to bring everyone back in September. However, policies vary by education level: as education level increases, fewer report working in person. But even among the most highly educated, most employees project returning to in-person work in August or September.<\/p>\n

Workplaces that offer employees the option to work from home or in person may be setting themselves up for\u00a0two tiers of workers<\/a>: those who are remote and those who work on site. Managing two different groups of workers on a go-forward basis could be challenging; those return to the office are more visible and as such may receive more attention, better opportunities, and more promotions. Awareness of this tendency and updates to processes may help to ensure all workers are treated in an equitable manner.<\/p>\n

Developing a\u00a0successful hybrid model<\/a>\u00a0will also require accommodating the differing needs of differing demographics. For example, because women tend to take on more of the childcare and household responsibilities, working from home may be more appealing to women. Younger workers may need more help setting up a home office and connecting with mentors.<\/p>\n

Workplaces are being forced to be\u00a0creative in the bonuses and perks<\/a>\u00a0they offer to entice new employees. More restaurants are offering 401(k)s to their workers than before the pandemic, while even big companies such as Walmart, Target, and Facebook are offering tuition reimbursement or child-care benefits. Wages and signing bonuses are also common, especially in food services and retail.<\/p>\n

ECONOMY<\/h3>\n

Inflation\u00a0appears to be moderating<\/a>, as the consumer price index rose less in July than in June, but it does not appear that we will return to the low inflation of the pre-pandemic days. Used car prices, which were a big driver of inflation recently, are beginning to moderate, but prices of other services such as lodging are increasing as people begin traveling again.<\/p>\n

Meanwhile, job openings in June shot to a\u00a0record high of 10.1 million<\/a>\u00a0as hiring also increased to near-record levels. However, the level of people voluntarily leaving their jobs (the quits rate) also increased in June to 3.9 million people, well above pre-pandemic levels. The quits rate is seen as a barometer of job market confidence. However, worries remain that a resurgence in infections could discourage the unemployed from returning to work.<\/p>\n

Only a fraction \u2013 $3 billion \u2013 of the total\u00a0$46.6 billion allocated for rental assistance<\/a>\u00a0has been distributed by the end of June. Although the program is overseen by the Treasury, implementation has been the responsibility of an uneven patchwork of state, county, and municipal governments plus charitable organizations. Local organizations have had to build programs from scratch and have had to hire additional staff to process applications. Some regions have adopted recent guidance which makes it easier for tenants to demonstrate financial need, while others require voluminous documentation.<\/p>\n

GENERAL RESOURCES<\/h3>\n