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May 2020

IRS Sets Start Date for Tax Credits Under Family First Coronavirus Response Act

The IRS has announced that the employment tax credits for paid qualified sick leave and family leave wages required by the Families First Coronavirus Response Act ( P.L. 116-127) will apply to wages and compensation paid for periods beginning on April 1, 2020, and ending on December 31, 2020. Additionally, days beginning on April 1, 2020, and ending on December 31, […]

IRS Provides Deposit Penalty Relief for New Refundable COVID-19 Employer Credits

The IRS has provided penalty relief for failure to deposit employment taxes under Code Sec. 6656 to employers entitled to the new refundable tax credits provided under the Families First Coronavirus Response Act (Families First Act) ( P.L. 116-127), and the Coronavirus Aid, Relief, and Economic Security (CARES) Act ( P.L. 116-136). The relief is provided the extent that the amounts not deposited are […]

April 2020

HSA High-Deductible Health Plans Can Cover Coronavirus Costs

The IRS has provided emergency relief for health savings accounts (HSAs) and COVID-19 health plans costs. Under this relief, health plans that otherwise qualify as high-deductible health plans (HDHPs) will not lose that status merely because they cover the cost of testing for or treatment of COVID-19 before plan deductibles have been met. In addition, any vaccination costs will count […]

March 2020

FLAHERTY SALMIN CPAs RECEIVES FIVE-TIME ROCHESTER TOP WORKPLACES AWARD

ROCHESTER,
NY (MARCH 30, 2020) – Ask any CPA what they’ve been up to lately, and the unanimous
answer is, “working.”  Even though the
April 15 tax deadline has been extended to July 15, the team at Flaherty Salmin
CPAs is still busily preparing financial
reports and tax returns for their corporate, affordable housing, and
personal clients, while also helping businesses, organizations and individuals
navigate the financial […]

Calculation of “Average Income” Minimum Set Aside Test for Low Income Housing Credit Explained

Taxpayers claiming the low-income housing credit should apply the “average income” minimum set aside test by reference to the “very low-income” limits calculated by the U.S. Department of Housing and Urban Development (HUD) for purposes of determining eligibility under the HUD Section 8 program. HUD determinations for very low-income housing families are currently used to calculate the low-income housing credit income limits under the […]

Fleet-Average and Vehicle Cents-Per-Mile Base Valuation Amounts Updated

Final regulations increase a vehicle’s maximum value for eligibility to use the fleet-average valuation rule or the vehicle cents-per-mile valuation rule. The regulations provide transition rules for certain employers. The final regulations are effective on February 5, 2020, the date of publication in the Federal Register.

TCJA Increased Maximum Vehicle ValuesBefore the Tax Cuts and Job Act (TCJA) ( P.L. 115-97), the […]

Guidance Provided on Qualifying for EITC

The IRS has provided guidance on qualifying for the Earned Income Tax Credit (EITC). The EITC is a refundable tax credit that is intended to be a financial boost for families with low to moderate incomes.

Due to changes in marital, parental or financial status, millions of workers may qualify for EITC for the first time this year. The IRS urges […]

Proposed Regulations Reflect Changes to Wage Withholding, Redesigned W-4

The IRS has proposed regulations with guidance for employers on withholding federal income tax from employee’s wages. The proposed regulations:

implement recent changes made to Code Secs. 3401 and 3402 by the Tax Cuts and Jobs Act (TCJA) ( P.L. 115-97); andreflect the redesigned 2020 Form W-4, Employee’s Withholding Certificate, and the related wage withholding tables and computational procedures published in IRS Pub. 15-T, Federal Income Tax Withholding […]

February 2020

Individual Mandate Ruled Unconstitutional

The Fifth Circuit U.S. Court of Appeals ruled that the Patient Protection and Affordable Care Act’s (ACA) ( P.L. 111-148) individual mandate is unconstitutional because it can no longer be read as a tax, and there is no other constitutional provision that justifies this exercise of congressional power. However, the central question of whether the rest of the ACA remains valid […]

Qualified Opportunity Zone Investment Regulations Finalized

Proposed qualified opportunity zone regulations issued on October 29, 2018 ( REG-115420-18) and May 1, 2019 ( REG-120186-18) under Code Sec. 1400Z-2 have been finalized with modifications. The regulations. which were issued in a 550 page document, are comprehensive.

The regulations address issued related to all aspects of the gain deferral rules and also various requirements that must be met for an entity to qualify […]

Final Regulations Address Withholding on U.S. Source Income

The Treasury and IRS have issued final regulations on the due diligence and reporting rules for persons making certain U.S. source payments to foreign persons. Guidance is also provided on reporting by foreign financial institutions on U.S. accounts. The regulations are effective on the date the regulations are published in the Federal Register.

Obtaining a Foreign TIN and Date of BirthTemporary […]

January 2020

Partner Tax Basis Capital Reporting Not Required Until 2020 Partnership Tax Years

The IRS has released guidance that provides that the requirement to report partners’ shares of partnership capital on the tax basis method will not be effective for 2019 partnership tax years, but will first apply to 2020 partnership tax years.

2019 Reporting

For 2019, partnerships and other persons must report partner capital accounts consistent with the reporting requirements in the 2018 forms […]

Final Regulations on Calculation of UBTI Issued

The IRS has released final regulations that present guidance on how certain organizations that provide employee benefits must calculate unrelated business taxable income (UBTI) under Code Sec. 512(a).

Background

Organizations that are otherwise exempt from tax under Code Sec. 501(a) are subject to tax on their unrelated business taxable income (UBTI) under Code Sec. 511(a). Code Sec. 512(a) defines UBTI of exempt […]

Final Rules Adopted on Changes to Estate Tax Exclusion Amount

The IRS has issued Reg. §20.2010-1(c) to address the effect of the temporary increase in the basic exclusion amount (BEA) used in computing estate and gift taxes. In addition, Reg. §20.2010-1(e)(3) is amended to reflect the increased BEA for years 2018-2025 ($10 million, as adjusted for inflation). Further, the IRS has confirmed that taxpayers taking advantage of the increased BEA […]

December 2019

FORBES NAMES FLAHERTY SALMIN CPAs AMONG AMERICA’S TOP RECOMMENDED TAX AND ACCOUNTING FIRMS

December 23, 2019 –
ROCHESTER, NY
– Flaherty Salmin CPAs, a tax and accounting
firm headquartered in Rochester, New York, has recently joined the ranks of the
top recommended tax and accounting firms across the country. This year, Forbes
partnered with a market research company called Statista to create a list of 227 firms – all in varying sizes
– who are successfully tackling the complexities […]

Ugly Sweater Party 2019

Firm-wide Ugly Sweater Party. Congratulations to 2019 winners Vlad A. for Ugliest Sweater and Terri C. for Most Festive Look!

Is it 2019 or 1920? Flaherty Salmin CPAs held a themed murder mystery dinner to celebrate the holiday season.

Treasury, IRS Release Draft Opportunity Zone Reporting Form

Treasury and the IRS on October 31 announced the release of a new, draft form implementing certain reporting requirements under the Tax Cuts and Jobs Act Opportunity Zone program.

The proposed Form 8996 for Qualified Opportunity Funds (QOFs) comes after numerous calls on Capitol Hill for more transparency within the Opportunity Zone program. “The form is designed to collect information on […]

Proposed Rules Clarifying Carried Interest Limitation Expected Early 2020, Kautter Says

Treasury and the IRS are expected to release proposed rules in “early 2020” that would clarify certain limitations on the carried interest tax break, according to David Kautter, Treasury’s assistant secretary for tax policy. Kautter briefly addressed the proposed regulations’ timeline while speaking at the American Institute of CPAs (AICPA) 2019 National Tax Conference in Washington, D.C.

Carried Interest Limitation

The forthcoming […]

IRS Increases Enforcement Action on Syndicated Conservation Easements, IR-2019-182

The IRS has announced a significant increase in enforcement actions for syndicated conservation easement transactions. This is a “priority compliance area” for the agency.

Throughout the IRS, coordinated examinations are being conducted in the Small Business and Self-Employed (SB/SE) Division, Large Business and International (LB&I) Division, and Tax Exempt and Government Entities (TE/GE) Division. The IRS Criminal Investigation (CI) Division has […]

November 2019

IRS Provides Section 199A Safe Harbor for Rental Real Estate

The IRS has issued a revenue procedure with a safe harbor that allows certain interests in rental real estate to be treated as a trade or business for purposes of the Code Sec. 199A qualified business income (QBI) deduction. The safe harbor is intended to lessen taxpayer uncertainty on whether a rental real estate interest qualifies as a trade or […]

Cryptocurrency Guidance, Virtual Currency FAQs Released

The IRS has released cryptocurrency guidance and frequently asked questions (FAQs) on virtual currency. Under the cryptocurrency guidance:

a taxpayer does not have gross income from a “hard fork” of the taxpayer’s cryptocurrency if the taxpayer does not receive units of a new cryptocurrency; anda taxpayer has ordinary income as a result of an “airdrop” of a new cryptocurrency following a […]

Final Regs Revert Back to Prior Partnership Disguised Sale Rules

New final regulations that address the allocation of partnership liabilities for disguised sale purposes revert back to prior regulations. Under the final regulations:

a partner’s share of a recourse liability of the partnership equals the partner’s share of the liability under the rules of Code Sec. 752 and the related regulations; anda partner’s share of a nonrecourse liability of the partnership […]

October 2019

Final Regulations on 100 Percent Bonus Depreciation Issued, Along With New Proposals

Final regulations dealing with the 100 percent bonus depreciation allowance for qualified property acquired and placed in service after September 27, 2017, allow property which is constructed under a pre-September 28, 2017 binding contract to qualify for the 100 percent rate. The final regulations adopt proposed regulations ( REG-104397-18) with certain modifications, including a revised constructed property rule. In addition, […]

Proposed Regulations Provide Guidance on Section 382(h) Built-in Gain and Loss Computation

Proposed regulations would provide guidance on the inclusion of income and deduction items in the calculation of built-in gains and losses under Code Sec. 382(h). The proposed regulations would:

simplify the application of Code Sec. 382;provide more certainty to taxpayers in determining built-in gains and losses for Code Sec. 382(h) purposes; andensure that the application of certain law changes made by […]

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