Thinking About Taking the Employee Retention Credit? Be Ready to Defend Your Positions
Tax professionals expect ERC claims to be a significant target for IRS audits over the next few years. The IRS has announced it is training 300 agents for civil and criminal investigations regarding ERC claims. Federal grand juries have already returned at least 10 criminal indictments related to improper ERC claims.
COVID-19’s Lasting Effects on Nonprofits – Relief Programs
The American Rescue Plan Act of 2021 made many large nonprofit organizations eligible to apply for PPP loans for the first time. The legislation also provided new or extended employment-related programs (such as the Employee Retention Credit) and allocated federal funding for many programs championed by nonprofits, such as childcare, arts and humanities, food assistance and services for the homeless.
Taxation of Coronavirus-Related Distributions
The CARES Act provided for “coronavirus-related” distributions from certain qualified retirement plans. Participants who chose to take advantage of the program could avoid the normal 10% early withdrawal penalty for distributions taken before age 59 ½ and spread the income over a three-year period for federal income tax purposes.
Pandemic Relief for Retirement Plans
Many of the relaxed retirement plan rules provided for in the CARES Act that was passed in March 2020 expired at the end of the year. As the future of the pandemic is uncertain, so too is the outlook for retirement plan relief.
Last-Minute Tax Planning Strategies to Consider Before the End of 2020
2020 has been a rollercoaster of a year. Check out these last-minute tax planning strategies to consider before the end of the year.