Compare and Contrast: How do the Republican and Democratic Tax Plans Differ?
With the presidential election only weeks away, many people are beginning to pay closer attention to each candidate’s positions on such issues as the COVID-19 pandemic, health care, the environment and taxes. Among their many differences, President Donald Trump and former Vice President Joe Biden have widely divergent tax proposals.
Providing Employees With Tax-Free COVID-19 Assistance: What Employers Need to Know
Are your employees struggling with unexpected medical, work-from-home, childcare or other expenses as a result of the COVID-19 pandemic? If so, a little-known tax law allows you to make tax-free payments to employees to help them cover these expenses.
Pitfalls of Executive Payroll Tax Deferral
The IRS issued guidance (Notice 2020-65) implementing President Trump’s executive action to defer the employee portion of the Social Security payroll tax. The guidance is brief, leaving employers with questions about whether, and how, to implement the deferral.
What Does the Executive Action Deferring Payroll Taxes Mean for Employers and Employees?
On August 8, 2020, President Trump signed an executive memorandum that defers an employee’s portion of Social Security and Medicare taxes from September 1 through December 31, 2020. At this point, the taxes are just deferred, meaning they will still have to be paid at a later date.
Accounting for PPP Loans
The Coronavirus Aid, Relief, and Economic Security (CARES) Act created the Paycheck Protection Program (PPP) to provide eligible entities, including small businesses and not-for-profit (NFP) organizations, with liquidity to support their operations and to keep their employees paid. PPP loans may be forgiven, in whole or in part, if certain conditions are satisfied including spending the PPP funds on qualifying expenses and maintaining specified levels of payroll and employment.
OMB Revisions to Single Audit Submission Extensions and Other Updates
In a memorandum dated June 18, 2020, the U.S. Office of Management and Budget (OMB) revised and reversed their flexibility on Single Audit submission extensions.
IRS Expands Availability of Coronavirus-Related Distributions
The IRS issued Notice 2020-50 (Notice) on June 19, 2020, which mainly provides additional guidance on and expansion of Coronavirus-Related Distributions (CRDs) created under the Coronavirus, Aid, Relief, and Economic Security (CARES) Act.
Paycheck Protection Program New Guidance Clarifies When to Apply for Forgiveness and Owner-Employee Limits
Borrowers that received PPP funds prior to June 5, 2020 have the option to use either a 24-week forgiveness period or an 8-week forgiveness period. On June 22, 2020, the SBA issued updated guidance that provides an additional option allowing a borrower to apply for forgiveness before the 24-week period ends.
Paycheck Protection Program Revised Forgiveness Applications
On June 17, 2020, the Small Business Administration (SBA) issued updated guidance to reflect the Payroll Protection Flexibility Act. The SBA also provided a revised PPP loan forgiveness application, Form 3508 and instructions, along with a simplified Form 3508 EZ and instructions for qualified borrowers.
FASB Defers the Effective Dates of ASC 606 and ASC 842
In response to the challenges of the COVID-19 pandemic, FASB issued Accounting Standards Update (ASU) 2020-05, which provides a one-year deferral of the effective dates of ASC 606, Revenue from Contracts with Customers, and ASC 842, Leases.