Archives for IRS

Expect IRS Delays on Paper Filed Tax Returns

February 23, 2022 | by | Comments Off on Expect IRS Delays on Paper Filed Tax Returns

Hani Sharestan, CPA, MST Tax Partner   In amidst of the 2021 tax season, you should expect delays from the IRS in processing paper filed tax returns that require manual processing. Based on a recent published report, the National Taxpayer Advocate said in its annual report to congress the IRS continues to experience unprecedented severe backlogs in processing paper filed tax returns that require manual processing.  The report shared the following data regarding the IRS backlog of unprocessed returns and correspondence: 2 million unprocessed individual returns (Form 1040) mainly from 2020 and before; 8 million unprocessed payroll tax returns (Form
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Categories: Industry News and Newsletter and Updates.
Tags: accountant, accountants, accounting, accounting firm, audit, business, ca, california, certified public accountants, cpa, cpa firm, firm, IRS, irvine, newsletter, oc, orange county, so cal, southern california, tax, tax filing, tax firm, tax planning, tax return, tax season, taxation, taxes, taxpayer, wfy, wright ford young, and wright ford young & co.

Tax Update on Business Meals Being 100% Deductible in 2021

June 15, 2021 | by | Comments Off on Tax Update on Business Meals Being 100% Deductible in 2021

Angela Tang, CPA Estate & Trust Supervisor   The cost of business meals were considered a deductible expense since 1986, the problem is only 50% of such costs were allowed as a deduction until now.  The latest 2020 stimulus bill saw many changes and one of the which is the business meal deduction.  A temporary exception for 2021-2022 is the 100% business meal deduction for meals “provided by a restaurant.”  The government is attempting to help the restaurant industry impacted by the Covid-19 shutdown by intentionally incentivizing business owners to patronize restaurants. In order to qualify for the business meal
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Categories: Industry News and Newsletter and Updates.
Tags: accountant, accountants, accounting, accounting firm, business, business meal, business meal deductible, business meal deduction, ca, california, certified public accountants, coronavirus, covid, covid19, cpa, cpa firm, deductible, deduction, expense, firm, IRS, irvine, oc, orange county, pandemic, reimbursement, restaurants, small business, so cal, southern california, tax, tax firm, taxation, taxes, wfy, wright ford young, and wright ford young & co.

Employers with Over 50 Employees Must Register with CalSavers by June 30

April 1, 2021 | by | Comments Off on Employers with Over 50 Employees Must Register with CalSavers by June 30

By June 30, 2021, nonexempt employers with more than 50 California W-2 employees must register with the CalSavers program. For exempt employers, if you’ve already offered a retirement plan, you do not have to participate in the program, but you still must register as “exempt” on the CalSavers website. Nonprofit organizations must register with CalSavers as well (if not exempt), but religious organizations are exempt from the registration requirements. How to Register for CalSavers Program For registering, employers will be notified via letter of their requirement to register with the CalSavers program. An access code will be given to them
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Categories: Industry News and Newsletter and Updates.
Tags: accountant, accountants, accounting, accounting firm, business, ca, california, calsavers, calsavers program, calsavers retirement program, certified public accountants, cpa, cpa firm, employees, employer, firm, ftb, IRS, irvine, oc, orange county, retirement, retirement program, small business, so cal, southern california, tax, tax firm, taxation, taxes, wfy, wright ford young, and wright ford young & co.

Significant Tax Provisions from Biden’s American Rescue Plan Act

March 18, 2021 | by | Comments Off on Significant Tax Provisions from Biden’s American Rescue Plan Act

Richard A. Huffman, CPA, MST Tax Partner   The American Rescue Plan Act signed into law by President Biden includes the following significant tax provisions: Business tax provisions: Family and sick leave credits – Extends tax credits through 9/30/21. Employee retention credit – Extended through 12/31/21, program criteria as follows: To qualify experienced a full or partial suspension of business operations due to COVID-19 governmental orders or incurred at least 20% decline in quarterly gross receipts as compared to the 2019 year quarter. Main benefits for employers with up to 500 full-time employees (limited benefits for employers with more than
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Categories: Industry News and Newsletter and Updates.
Tags: accountant, accountants, accounting, accounting firm, american rescue plan act, biden, business, ca, california, certified public accountants, coronavirus, covid, covid19, cpa, cpa firm, firm, individual, IRS, irvine, law, oc, orange county, pandemic, ppp, small business, so cal, southern california, stimulus bill, stimulus plan, tax, tax bill, tax firm, tax law, tax provisions, tax reform, taxation, taxes, wfy, wright ford young, and wright ford young & co.

New Partnership Audit Rules for 2018 Tax Filing Year

February 7, 2019 | by | Comments Off on New Partnership Audit Rules for 2018 Tax Filing Year

For the 2018 tax filing year, there are new Internal Revenue Service (IRS) partnership audit rules [also adopted by the California Franchise Tax Board (FTB)] in which the partnership, not its members, will now be responsible for tax adjustments under audit. There is a very narrowly defined opt-out provision that many partnerships do not qualify for.  Please consider amending the partnership operating agreement to designate a “partnership representative” to represent the company in disputes with the IRS or the FTB.  Also, you should consider including language regarding the responsibility of tax audit adjustments pursuant to the three allowable methods: “amend”,
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Categories: Newsletter and Updates.
Tags: 2018, accountants, accounting, amend, audit, certified public accountants, cpa, ftb, IRS, irvine, method, new rules, partnership audit rules, partnerships, pull in, pull out, tax, taxation, taxes, wfy, wright ford young, and wright ford young & co.

Rental Real Estate Owners-Guidance Related to the 20% Pass-through Deduction

February 4, 2019 | by | Comments Off on Rental Real Estate Owners-Guidance Related to the 20% Pass-through Deduction

On January 18, 2019, the IRS issued a notice providing “safe harbor” conditions under which rental real estate activities will be treated as a trade or business for purposes of the IRC Section 199A deduction. To qualify for the safe harbor: Separate Books and records must be maintained for each rental real estate enterprise. At least 250 hours of rental services must be performed by the taxpayer and/or workers for the taxpayer during the tax year for each rental real estate enterprise.  To clarify, a real estate enterprise may be one rental or multiple rentals.  Commercial and residential rentals cannot
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Categories: Industry News and Newsletter and Updates.
Tags: 1099, 199a, accountants, accounting, certified public accountants, cpa, irc, IRS, irvine, real estate, rentals, safe harbor, section 199a, tax, tax firm, taxation, taxes, taxpayer, wfy, wright ford young, and wright ford young & co.

New IRS Partnership Audit Rules Prompt New Look at Operating Agreement

January 10, 2019 | by | Comments Off on New IRS Partnership Audit Rules Prompt New Look at Operating Agreement

The IRS introduced a new set of partnership auditing rules which take effect in the financial year 2018 and are meant to make it easier for the agency to uncover and collect underpaid taxes from partnership entities.  The previous audit system was challenging for the IRS because it was difficult to pin down who owed the tax under a complex partnership structure. Small partnerships with less than 100 members can opt out if no partner is a pass-through entity. The IRS will begin reviewing tax filings in line with the new procedure in 2019, so audits could start as soon
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Categories: Industry News and Newsletter and Updates.
Tags: accountants, accounting, audit, audit regime, california, certified public accountants, cpa, IRS, irvine, oc, orange county, partnerships, tax, taxation, wfy, wright ford young, and wright ford young & co.

Making Large Gifts Now Won’t Harm Estates After 2025

November 29, 2018 | by | Comments Off on Making Large Gifts Now Won’t Harm Estates After 2025

On November 20th, the IRS announced individuals taking advantage of the increased gift and estate tax exclusion amounts in effect from 2018 to 2025 will not be adversely impacted after 2025 when the exclusion amount is scheduled to drop to levels before 2018. The Treasury Department and the IRS issued proposed regulations which implement changes made by the 2017 Tax Cuts and Jobs Act (TCJA).  As a result, individuals planning to make large gifts between 2018 and 2025 can do so without concern that they will lose the tax benefit of the higher exclusion level once it decreases after 2025.
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Categories: Industry News and Newsletter and Updates.
Tags: accountant, accountants, accounting, audit, business, ca, california, certified public accountants, cpa, cpa firm, deduction, estate, estate and trusts, estates, exclusion, firm, IRS, tax, tax firm, tax reform, taxation, taxes, TCJA, trusts, wfy, wright ford young, and wright ford young & co.

IRS To Issue More ACA Penalties

June 26, 2018 | by | Comments Off on IRS To Issue More ACA Penalties

The IRS began issuing Affordable Care Act (ACA) penalty assessments in its Letter 226J tax notice in November 2017. These notices are being sent to employers who the IRS identified through its recently developed Affordable Care Act Compliance Validation System “ACV” System, as having failed to comply with the ACA’s employer mandate.  So far, the IRS has issued more than 30,000 of these notices containing employer shared responsibility payments (ESRPs) assessments of more than $4.4 billion. Under the ACA, organizations with 50 or more full-time employees and full-time equivalent employees, are required to offer minimum essential coverage to at least
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Categories: Industry News and Newsletter and Updates.
Tags: aca, accountants, accounting, affordable care act, audit, certified public accountants, cpa, esrp, IRS, penalties, tax, taxation, tigta, wfy, and wright ford young.

Avoid Scammers: How the IRS Does and Does Not Contact Taxpayers

June 14, 2018 | by | Comments Off on Avoid Scammers: How the IRS Does and Does Not Contact Taxpayers

In order to help taxpayers avoid scams in which criminals impersonate IRS employees, IRS has issued a Fact Sheet in which it sets out the ways that it does and does not contact taxpayers.  The IRS has been publishing this sheet for years to help taxpayers protect themselves from scammers and the warning signs. Below are the legitimate ways the IRS employees will contact taxpayers: IRS initiates most contacts with taxpayers through regular mail delivered by the U.S. Postal Service. However, there are special circumstances in which IRS will call or come to a home or business. Even then, taxpayers will
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Categories: Newsletter and Updates.
Tags: accountants, accounting, audit, cpa, IRS, scammers, tax, tax help, taxation, taxpayers, wfy, and wright ford young.