PPP has run out of money for most borrowers

Ferrone & Associates CPAsBlog

The Paycheck Protection Program has run out of money for most borrowers before its planned May 31 end, the Small Business Administration said. Going forward, the program will only accept new applications from community financial institutions, which typically serve minority borrowers, as about $8 billion in funding was set aside for such businesses. The SBA will continue to fund outstanding … Read More

7 Ways to Handle Difficult Conversations at Work

Ferrone & Associates CPAsBlog

A few tips to help you navigate relationships with clients and coworkers alike: 1. Have a Direct Approach When having a conversation with a client, be direct and clear from the start. If possible, layout a plan of next steps instead of dancing around the subject or making excuses. People will appreciate an honest and direct approach about what happened … Read More

5 Business investment ideas for unused stimulus checks

Ferrone & Associates CPAsBlog

Since the beginning of the coronavirus pandemic, the government has sent out a few rounds of stimulus checks. Here’s a breakdown of the COVID-19 legislation and stimulus check amounts: CARES Act: $1,200/person maximum Consolidated Appropriations Act: $600/person maximum American Rescue Plan: $1,400/person maximum Not all taxpayers received checks each round, as they were based on an individual’s adjusted gross income. … Read More

IRS offers safe harbor for claiming PPP loan deductions

Ferrone & Associates CPAsBlog

The IRS and the Treasury Department are giving small businesses that received Paycheck Protection Program loans in the first round a way to deduct expenses they couldn’t claim last year. The Internal Revenue Service and the Treasury released Revenue Procedure 2021-20 on Thursday, which provides a safe harbor in accordance with a provision in last December’s COVID-19 relief package. Under … Read More

IRS and COVID vaccine email scams proliferating this tax season

Ferrone & Associates CPAsBlog

Security experts are seeing a rise this tax season in phishing schemes and malware tied to hot-button subjects like tax refunds, stimulus payments and COVID-19 vaccines. The Internal Revenue Service recently warned about an ongoing IRS-impersonation scam that mainly targets educational institutions, including students and staff who have “.edu” email addresses. The emails show the IRS logo and use subject … Read More

Form 1099-K Update

Ferrone & Associates CPAsBlog

The IRS is planning to bring important changes to Form 1099-K filings. Prior to this update, the IRS required each payment settlement entity (PSE), aka credit card processing companies, to send Form 1099-K to both the IRS and the recipient (or customer) if the PSE has processed payments amounting to at least $20,000 and at least 200 transactions per customer … Read More

How the American Rescue Plan Affects Families

Ferrone & Associates CPAsBlog

The American Rescue Plan Act (ARPA)  went into effect in March 2021. This bill introduced a $1.9 trillion COVID-19 relief package designed to help boost the economy amidst the effects of the pandemic. Among other things, the act affects tax planning for individuals who are unemployed and for people who have children. It also authorized the sending of a third … Read More

New Paycheck Protection Information!

Ferrone & Associates CPAsBlog

The Paycheck Protection Program Extension Act passed overwhelmingly in the Senate, following a similar passage in the House. The PPP Extension Act will allow small businesses to continue applying for aid through the end of May and the SBA to process applications through June. The bill has been sent to President Biden for signing. There is nearly $79 billion left … Read More

First Some Good News from the IRS:

Ferrone & Associates CPAsBlog

The IRS will Handle Unemployment Returns, Don’t Amend Returns that reported unemployment benefits prior to the $10,200 exclusion enactment should not be amended. The IRS has indicated it will refigure taxes on these returns and adjust the taxpayer’s account accordingly. The IRS will then send any refund amount directly to the taxpayer. And now the not so good news; The IRS … Read More

Probably not a good year for do-it-yourselfers

Ferrone & Associates CPAsBlog

Federal filing and payment deadlines have been delayed. Will the states delay filing deadlines also? New security concerns about scammers that are after the/your Economic Impact Payments (EIP). New EIP & Child Tax tax credits and payments are taking effect. (How much & when are you entitled to receive?)  Retroactive unemployment payments face problems sorting out the reporting requirements. AND … Read More

Tax deadline delayed until May 17

Ferrone & Associates CPAsBlog

The Internal Revenue Service has pushed back the tax-filing deadline until May 17 after heavy pressure from Congress and tax and accounting groups. The move will give taxpayers and tax professionals an extra month after the original deadline of April 15. May 15 falls on a Saturday, so the date was moved up until Monday, May 17. Last year, the … Read More

Big News for Unemployment Compensation

Ferrone & Associates CPAsBlog

Extra Extra! Read all about it! New Exclusion of up to $10,200 of Unemployment Compensation If your modified adjusted gross income (AGI) is less than $150,000, the American Rescue Plan enacted on March 11, 2021, excludes from income up to $10,200 of unemployment compensation paid in 2020, which means you don’t have to pay tax on unemployment compensation of up … Read More

Momentum builds for delaying tax deadline

Ferrone & Associates CPAsBlog

Leaders of the House Ways and Means Committee and accounting groups are calling for extending the tax deadline to give the IRS, taxpayers and tax professionals an extra three months. On Monday, the House Ways and Means Committee urged the IRS to extend the 2021 tax filing season until July 15, noting that the COVID-19 pandemic is continuing to impose … Read More

Resolving Workplace Disputes

Ferrone & Associates CPAsBlog

It is inevitable that conflicts and disagreements with coworkers will crop up no matter if you work from home or in an office.  Whether conflicts stem from miscommunication, clashing priorities, or personality differences, it’s important for your sake, your team members’ sake, and the sake of the company that you resolve the issue professionally and courteously. Here are a few … Read More

10 Smart Ways to Use Your IRS Stimulus Check

Ferrone & Associates CPAsBlog

Many Americans will soon be receiving additional stimulus checks from the federal government sometime in 2021. Here are some suggestions to use your stimulus check in the most efficient way.  1. Use the money to pay essential expenses. This is why the government is making these payments. Rent and mortgage payments top the list. Car payments too. Feeding your family. … Read More

Erroneous notices and the latest IRS delays

Ferrone & Associates CPAsBlog

The IRS acknowledges that there is a backlog of unprocessed 2019 tax returns and that it sent erroneous CP59 notices to certain taxpayers. Those who filed their 2019 return but nevertheless received the CP59 should disregard the notice and do not need to take any action. COVID-19 continues to cause delays in live phone support and answers to notice responses. … Read More

IRS warns of ghost tax preparers

Ferrone & Associates CPAsBlog

The Internal Revenue Service issued a warning to taxpayers to beware of unethical “ghost” tax preparers who don’t sign tax returns for clients. A ghost preparer may prepare and print out the return, but ask the client to sign it and mail it to the IRS. For electronically filed returns, the ghost will prepare but refuse to digitally sign the … Read More

5 Tips and Tricks to Emerge a Winner After COVID-19

Ferrone & Associates CPAsBlog

Although the COVID-19 pandemic is still raging, business owners have started to turn their minds to what will happen after most of the vaccines have been administered and the world is able to return to some semblance of normality.  With all the changes thrown your way due to covid-19 here are some tips and tricks for avoiding “zoom fatigue” and … Read More

Living on the Edge

Ferrone & Associates CPAsBlog

Much of today’s accounting world revolves around technology. As more and more firms work remotely and use technology to exchange information with their clients, security is becoming a large issue. With things changing so quickly, firms must always be up-to-date with the newest and best technology so we can have an edge up.  At Ferrone and Associates CPAs, the security … Read More

Yet another scam to be aware of: Fraudulent 1099-G filings

Ferrone & Associates CPAsBlog

On January 28, the Internal Revenue Service (IRS) issued a notice urging taxpayers who receive Forms 1099-G for unemployment benefits they did not actually get because of identify theft to contact their appropriate state agency for a corrected form. Scammers took advantage of the pandemic by filing fraudulent claims for unemployment compensation using stolen personal information of individuals who had not filed … Read More

Recent PPP loan forgiveness news for Utah business owners

Ferrone & Associates CPAsBlog

If your PPP loan was forgiven, it may still generate taxable income on your state tax return. As of recent news, the federal government waived taxes on PPP loans, but Utah is requiring businesses to pay taxes on any portions of PPP loans that have been forgiven.  As part of the CARES Act, Congress implemented the Paycheck Protection Program (PPP).  … Read More

When will the IRS begin processing returns?

Ferrone & Associates CPAsBlog

The IRS will begin accepting and processing returns Friday, February 12, 2021. Returns sent by preparers before this date are being held in a queue and will be transmitted to the IRS as soon as the IRS is ready to process.When the IRS starts processing returns, acknowledgments may be unpredictable due to the high volume of returns being processed. Sooner is always … Read More

PPP Loan Expense Deductions Now Approved

Ferrone & Associates CPAsBlog

The new economic relief law enacted late last year—the Consolidated Appropriations Act—clarified that expenses paid by business entities relating to loans made through the PPP are in fact tax-deductible. In doing so, the new law rendered previous IRS guidance in the form of Notice 2020-32 and Revenue Ruling 2020-27 obsolete. Background: Under the Coronavirus Aid, Relief, and Economic Security (CARES) … Read More

4 predictions for accounting in 2021

Ferrone & Associates CPAsBlog

If 2020 was a lesson in anything, it was to expect the unexpected. Who could have predicted a year of such unprecedented worldwide disruption? So, here are four predictions from the experts about what 2021 will look like in the world of accounting. 1. Increased focus on company culture, especially in dispersed teams Without a doubt, COVID-19 has accelerated the … Read More

Will stimulus payments affect tax returns? What tax pros need to know

Ferrone & Associates CPAsBlog

2020 introduced a number of unprecedented situations that have required some massive adjustments. And now, with the tax filing season upon us, a raft of brand new challenges await ahead of the April 15 deadline. Chief among them: uncertainty around the economic stimulus given to American taxpayers as part of the Coronavirus Aid, Relief and Economic Security, or CARES Act. … Read More

How to Make Money by Paying Your Kids

Ferrone & Associates CPAsBlog

As you help clients fill out their 1040 form, you’re always looking for additional write-offs they can take advantage of. Don’t forget parents who employ their children are allowed to deduct these wages. Three previous columns discussed a frequently-overlooked tax break for freelancers and other self-employed persons. The tax code allows parents to deduct wages they pay their sons and … Read More

IRS blesses tax breaks on forgiven PPP loans after law change

Ferrone & Associates CPAsBlog

The Internal Revenue Service will allow businesses that got their Paycheck Protection Program loans forgiven to write off expenses paid for with that money, shifting policy after Congress passed new legislation last month. IRS guidance issued on Wednesday overrides previous rules that recipients of PPP loans that had been forgiven couldn’t claim deductions for the wages, rent, utilities, and other … Read More

New IRS Stimulus Tax Breaks and Economic Relief

Ferrone & Associates CPAsBlog, Uncategorized

The new economic relief law passed by Congress at the end of 2020 provides a bevy of tax breaks for individuals and businesses. This includes several extensions and modifications of provisions in the Coronavirus Aid, Relief and Economic Security Act (CARES) Act. The changes in the economic relief law are many, so the following is just a brief overview of … Read More

Financial Planning Lessons Learned in 2020

Ferrone & Associates CPAsBlog

Looking back over a tumultuous year, we learned the value of cool heads and steady hands. After dealing with the ups and downs of the pandemic, the economy, the election, and political and civil unrest, we’ve learned some broader lessons that can be implemented in our financial planning for 2021. Here are the four biggest lessons we’re encouraging you to … Read More

Tax Savings Tips

Ferrone & Associates CPAsBlog

With COVID incomes down in 2020, there may be an opportunity for good tax planning to help. For example, if you hold an asset for one year and one day it is taxed at 15 percent or 20 percent, depending on adjusted gross income (AGI). Any asset that you sell that has been held less than a year and a … Read More

Planning for Year-End

Ferrone & Associates CPAsBlog

Review the CARES act changes for 2020 In March 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was signed into law and included relief provisions focused on IRAs and qualified retirement plans. These changes impact the processing and tax reporting of certain transactions in these accounts. Consider making a 2020 IRA contribution, and create or refresh your … Read More

Gifting and taxes: The sooner the better

Ferrone & Associates CPAsBlog

While festivities may be somewhat dampened this year due to the coronavirus, the holiday season seems to foster a spirit of giving. This year might be a good time to indulge the spirit, according to wealth planners. Right now is a very good time to gift. It’s a good idea to get any appreciation out of their potential estate and … Read More

The Importance of Cybersecurity

Ferrone & Associates CPAsBlog

Ransomware attacks pose as a threat for any business owner, CPA, or EA. If you suffered a data breach from a ransomware cyberattack you will most likely be forced to pay exorbitant fees as the attackers exchange money for you and your client’s personal information. Since 2016 approximately 4,000 of these types of ransomware attacks have been happening every day … Read More

The New Form 1099-NEC

Ferrone & Associates CPAsBlog

In case you have not heard: The IRS has revived Form 1099-NEC, which was last used in 1982. This form will be used in 2021 to report 2020 non-employee compensation. Corresponding changes were made to the 1099-MISC form. In recent years, non-employee compensation was reported in Box 7 of the 1099-MISC form, that box now goes away. Instead, the 1099-NEC … Read More

Creating a Foundation for Enduring Success Next Year

Ferrone & Associates CPAsBlog

As 2020 draws to a close, the topic of advisory services remains relevant to the accounting profession. At the recent Accounting & Finance Show USA, Intuit’s Jasen Stine explained how offering these services will make both you and your clients more successful in the face of the changes that resulted from the COVID-19 pandemic. Over the last year, one major … Read More

IRS Issues Tax Guidance on PPP Loans

Ferrone & Associates CPAsBlog

The Treasury Department and the IRS have just released additional guidance on the tax treatment of forgiveness of Paycheck Protection Program (PPP) loans authorized by the Coronavirus Aid, Relief and Economic Security (CARES) Act. But is it enough? The CARES Act says PPP loans may be forgiven without any tax consequences. The new ruling and accompanying revenue procedure follow up … Read More

Get ready for the next merger wave in accounting

Ferrone & Associates CPAsBlog

Between the pandemic, aging CPA firm owners, and staffing tensions, many in the accounting profession anticipate a huge uptick in firm mergers and acquisitions over the next 24 months. If the predictions and emerging trends are right, it’s important for firm leaders to plan accordingly. M&A is a profoundly serious matter, and you need to be prepared. Do not schedule … Read More

3 tips to break up your workday and improve your mental wellbeing

Ferrone & Associates CPAsBlog

If you’re working from home, things can start to feel repetitive. This is a feeling that is being shared by millions, as people all around the world deal with working in the same place as they sleep, eat and raise their family. And it can be detrimental to your mental wellbeing. Columbia University neuropsychologist Sanam Hafeez says: “When our day … Read More

End-of-Year Tax Strategies for Investors

Ferrone & Associates CPAsBlog

Busy season for accountants also, unfortunately, coincides with end-of-year tax planning. As you’re working on this with your clients, here are a few investment strategies from that may delight and help your clients save money next year.   It’s none too soon to review investment strategies that will keep money in your pocket and out of the IRS’s till, which is, … Read More

How to Avoid Scams and Phishing

Ferrone & Associates CPAsBlog

On Wednesday, November 4 the Security Summit reported that taxpayers are being targeted by a new series of text-message scams that impersonate state departments of revenue and tax relief organizations.  In an Internal Revenue Service press release, the Security Summit explains that identity thieves are asking taxpayers to provide bank account information finalize a transfer of Economic Impact Payment funds. … Read More

IRS Announces Taxpayer Relief Initiative

Ferrone & Associates CPAsBlog

The IRS announced a new program, the Taxpayer Relief Initiative, to help taxpayers who are unable to pay their taxes because of the pandemic.  Taxpayers who owe taxes and could not pay have always had options such as installment agreements and offers in compromise, but now they have more options. The highlights of the Taxpayer Relief Initiative, according to the … Read More

Answering an Important Question from a Client

Ferrone & Associates CPAsBlog

Andrew writes:  “Hello Richard, What do you think a “safe” number for my company would be?” My answer: Three months of operating capital is a reasonable amount. It gives you time to react. You can obtain financing, implement operational changes, cut costs, react to market trends and conditions, and a whole host of other uncertainties. (COVID restrictions, changes in tax … Read More

Ignore the Hype! Read this before you apply for your PPP Loan Forgiveness

Ferrone & Associates CPAsBlog

There are issues that have not been dealt with, perhaps the most important of which is the tax effect of loan forgiveness.  The IRS has taken the position, and rightfully so, that if a PPP loan is forgiven, it is considered to be cancellation of debt, which is taxable.  At issue is whether or not Congress passes legislation that will … Read More

Advice for Issues Businesses Owners Face Going Virtual

Ferrone & Associates CPAsBlog

Reopenings begin with masks, conference rooms have gone Zoom, and businesses face a load of new questions — but for many, the future comes down to one: “How am I going to survive?” We all know that virtual does not replace face-to-face and many small businesses have been hurt. But how can we help these businesses transitioning to virtual? A … Read More

13 Tips if You Haven’t Saved for Retirement

Ferrone & Associates CPAsBlog

According to research, most Americans don’t have enough money saved to retire. Fortunately, by taking these steps as early as possible, you can help change that.  Here are 13 tips to help you afford the retirement you deserve. Work Longer: Assuming your employer permits it, it’s the obvious choice. Each additional year shortens retirement while adding a year for additional … Read More

SBA has simplified the loan forgiveness process

Ferrone & Associates CPAsBlog

Good news for borrowers with PPP loans of $50,000 or less: The SBA has simplified the loan forgiveness application process. Now you just need to fill out a 1-page application, provide supporting documentation, and certify that funds were used for approved purposes in order to qualify for forgiveness. Documents Required: 3rd Party payroll reports (Gusto, ADP, Paychex, etc.) or self-generated … Read More

How Firms Can Take Advantage of New Technology and Resources

Ferrone & Associates CPAsBlog

During this last year, we have learned so much about managing our remote workforce, rethinking the scope and delivery of our services, and about new and new-to-us resources and tools that have helped us transition and adapt. There is no argument that established, virtual firms had a leg up on the competition. Although it may seem that we have made … Read More

Remote workers may provide tax savings for employers

Ferrone & Associates CPAsBlog

Working remotely during the pandemic may become routine, as both companies and workers come to appreciate the convenience and savings available.  There are also many opportunities to save on taxes imposed by local jurisdictions on the business entity. A number of local jurisdictions — and the list is growing — impose local taxes on business entities. In some cases, such … Read More

4 ways to overcome resistance towards a new process or tool at your firm

Ferrone & Associates CPAsBlog

New ideas can help you and your firm save time, money, and increase the number of clients you serve. But any idea — whether it’s a tool, system, process, or just a new way to do things — requires change. And people resist change. If you’re part of a firm, and you’ve identified a need for change, how do you … Read More

Q&A: Tax Code Changes for Individuals in 2020

Ferrone & Associates CPAsBlog

The year 2020 has been filled with change, and the tax code is no exception to this. Recently, yet another occurred: Taxpayers are now temporarily allowed to deduct charitable contributions. The tax code allows individuals to deduct donations to charities only if they itemize on Form 1040’s Schedule A. They can’t claim contributions when they use the standard deduction amounts … Read More

Why Automation Will Change the Way Your Firm Does Business

Ferrone & Associates CPAsBlog

You must prepare for the future — today. Automation isn’t about replacing people with machines. It’s simply the next step in the accounting evolution. Automation is: Fast. It allows accountants to spend their time using data to create a value-focused firm. More accurate. No more transposition errors or other costly human errors. Automation is a cut-and-paste action rather than transposing. … Read More

Turning off the always-on economy: How to take back control of your time, work, and sanity.

Ferrone & Associates CPAsBlog

Just a few years ago, people saw technology as exciting and filled with possibilities.  But the constant notifications, alerts, and reminders are taking a serious toll on our productivity, our social lives, and our mental health. You can see this epidemic first-hand in coffee shops worldwide. Workers have one eye on Slack, one eye on email, and no eyes left … Read More

Form 1099-NEC Officially Replaces 1099-MISC for Reporting Payments to Nonemployees

Ferrone & Associates CPAsBlog

In case you haven’t heard, there’s a new tax form on the block for business filers for the 2020 tax year. Form 1099-NEC, Nonemployee Compensation, will be used instead of Form 1099-MISC to report amounts paid by businesses to independent contractors and others who provide services. In actuality, the new Form 1099-NEC isn’t entirely “new.” It’s an updated version of … Read More

Your Best Defense Against Ransomware

Ferrone & Associates CPAsBlog

Not too long ago, the WannaCry ransomware attack was all over the news, infecting over 400,000 computers. The threat was fairly straightforward: Pay us or we’ll erase your files. Ransomware, like the WannaCry attack, works by encrypting your files to prevent you from using or accessing them. After your files are compromised, the hackers behind the attack then pop up … Read More

How Does the Medicare Surcharge Affect Self-Employed Individuals?

Ferrone & Associates CPAsBlog

In his latest column on Medicare surtaxes, financial guru Julian Block addresses what your self-employed clients need to know about this complex area of tax law. Julian Block has devoted several previous columns to the Medicare surtax of 0.9 percent on earned income. It applies to high-income individuals when their salaries, other kinds of employee compensation, such as severance arrangements … Read More

Emphasis on Divorce Negotiations: a message from a CPA

Ferrone & Associates CPAsBlog

I would encourage anyone involved in a divorce to have their CPA involved in the divorce negotiations. Our recent article about the divorce process includes 8 tax factors to be considered. These are good factors to be aware of and they are seldom included in a divorce decree.  It is important to have a CPA during tax negotiations because these … Read More

8 Tax Areas to Factor into Divorce Negotiations

Ferrone & Associates CPAsBlog

This article addresses eight tactics that may be used to affect your spouse’s net worth, which will directly affect your final financial settlement. You need to be aware of these so that you can gain assurance that all aspects of your spouse’s financial assets are fairly and accurately valued and disclosed on their net worth statement. This will enable your … Read More

IRS urged to stop sending notices for unpaid taxes until it catches up on mail backlog

Ferrone & Associates CPAsBlog

The House Ways and Means Committee is asking the Internal Revenue Service to quit mailing notices for unpaid taxes to taxpayers who may have been affected by the mail backlog at the agency due to the COVID-19 pandemic. Many taxpayers have been receiving balance-due notices from the IRS even though they sent in their tax payments to the IRS months … Read More

Is your password strong enough?

Ferrone & Associates CPAsBlog, Uncategorized

A weak password is still one of the most common ways hackers break-in. Thanks to sophisticated brute-force-attack software readily available online, hackers can try tens of millions of possible password combinations per second. For example, hacking software can guess a five-character password in under three hours. If you only use lowercase letters, it’s 11.9 seconds. You need to have a … Read More

One more IRS refund

Ferrone & Associates CPAsBlog

13.9M taxpayers will get interest on their refunds The IRS is required to add interest to tax refunds on timely filed refund claims issued more than 45 days after the return due date.  The Internal Revenue Service plans to send interest payments averaging $18 to approximately 13.9 million individual taxpayers who filed their 2019 federal income tax returns on time … Read More

Traps to Avoid with Mergers

Ferrone & Associates CPAsBlog

If you are a business owner who is considering a merger at some point, it is vital to learn more about this process early in the game. Any business owner understands the difficulty of starting a new business and keeping the business alive. In most cases, crucial decisions must be made in order for the business to move forward, including … Read More

What you need to know about the Payroll Tax Deferral

Ferrone & Associates CPAsBlog

Recently, Donald Trump included a payroll tax deferral in his executive orders and it is leaving people unsure about what to do. CPAs, attorneys, and payroll programmers are all eagerly anticipating guidelines from the Internal Revenue Service and the Treasury Department on how to handle the payroll tax deferral that President Trump included in his executive orders. The IRS is … Read More

How working from home may change your taxes

Ferrone & Associates CPAsBlog

A large percentage of the workforce is now working from home, and company offices may be a thing of the past.  For companies that have gone remote, a new development of work-from-home is state tax nexus. Working in one municipality and living in another is nothing new. But now a large chunk of the workforce is working in one state … Read More

Ferrone and Associates picked as one of the 11 best accountants of SLC!

Theresa FerroneBlog

Expertise scored 48 accountants in the Salt Lake area and picked the top 11 for their “Best Accountants in Salt Lake City” of 2020.  Expertise’s goal was to “connect people with the best local experts” so they scored accountants on more than 25 different variables across five categories to pick out the best of the best accountants in Salt Lake … Read More

NCCPAP urges Congress to consider automatic forgiveness for smaller PPP loans

Theresa FerroneBlog

The National Conference of CPA Practitioners (NCCPAP) is urging Congress to automatically forgive smaller loans under the Paycheck Protection Program, and to make business expenses paid for with forgiven PPP funds are deductible. In a letter written to Congress by the NCCPAP it states that businesses with loans under $150,000 were often those hit hardest by the pandemic, and at … Read More

Planning Beyond COVID-19: the Main Street Lending Program

Theresa FerroneBlog, Uncategorized

Small-to-midsized companies in need of capital need to leave no stone unturned. Now that the Federal Reserve Bank is buying Main Street Loans, should you or your clients consider applying for loans through the Main Street Lending Program (MSLP)? With each interim financial statement release, accountants gain greater visibility into the COVID-19 impact on company balance sheets and the need … Read More

6 productivity hacks for remote CPAs

Theresa FerroneBlog

As the brick-and-mortar economy flirts with reopening, working from home is becoming the new normal. CPAs have no need to return to crowded offices, especially not in states where COVID-19 is having a second wind. Even if CPAs could resume their usual office rituals, their clients (or colleagues), may not be eager to meet in person. It seems that accounting … Read More

Big Jumps seen in Tax Prep Fees

Theresa FerroneBlog

The average fee nationwide to prepare a non-itemized 1040 and a state return jumped almost 26 percent in the last two years, according to a recent survey. That represents a rise of $45. Responses showed that the average cost to prepare an itemized 1040 and a state return rose almost 11 percent from 2018. The average nationwide price for doing … Read More

Many Firms Commit to Permanently Working from Home, Including Ferrone and Associates CPAs

Theresa FerroneBlog

According to a new study, two-thirds of accounting firm leaders reported a drop in staff productivity during the coronavirus pandemic, but they’re still committed to allowing employees to work from home even after they reopen their offices. Accountants at firms of all sizes across the U.S., as well as leaders from a range of financial services and professional services companies,  … Read More

Tax-related COVID-19 News You May Not Have Heard

Theresa FerroneBlog

Here’s a COVID -19 retirement-related easing that hasn’t got much attention: the 10% fine on pre-age-59 ½ payouts from retirement accounts is waived on up to 4100,000 of coronavirus-related distributions in 2020 from 401(k)s, 403(b)s and IRAs. A coronavirus-related distribution is defined as a payout to an individual who experiences financial difficulties from being diagnosed with COVID-19; who has a … Read More

Good News for Small Business Owners Regarding the PPP

Theresa FerroneBlog

On Friday, June 5, the new Paycheck Protection Program Flexibility Act of 2020 was signed. This new legislation amends the Small Business Act and the CARES Act. The Paycheck Protection Program Flexibility provides PPP borrowers with more flexibility on PPP loan forgiveness. Here are some of the highlights: Gives borrowers the option to extend the “covered period” for loan forgiveness from … Read More

When to Expect your Paper Stimulus Check

Theresa FerroneBlog

Some people expecting paper stimulus checks may have to wait months before seeing the payment in their mailbox. IRS is sending paper checks to individuals who qualify for the economic impact payment but didn’t get it directly deposited into their bank accounts. Some checks have already been mailed out to taxpayers. For the rest, the Service will send out approximately … Read More

Tax Rebates and Stimulus Checks

Theresa FerroneBlog

Dead people are not eligible to receive an economic impact payment. The IRS says that if you got a stimulus payment for someone who died, you must return it. If the payment was made to joint filers and one spouse is still alive, you need to return only the decedent’s portion and can keep the remainder. See www.kiplinger.com/linke/deceased on how … Read More

Multiple Cash Flow Scenario That Helps Adjust for Uncertainty

Theresa FerroneBlog

COVID-19 and the associated shelter-in-place orders around the country have impacted business leaders enormously. Everyone is waiting for the dust to settle to see how deeply the economic downturn may go. The crucible of the post-COVID marketplace will ramp up urgency; business owners need to understand and respond with increasingly accurate and effective strategies. COVID-19 has not changed the reality … Read More

Tax News that has been overlooked during COVID-19

Theresa FerroneBlog

With COVID-19 dominating the news cycle, other issues are being overlooked. A prime example is the fate of Obamacare, which is before the Supreme Court. In late 2019, an appeals court ruled that the individual mandate is unconstitutional because the tax reform law eliminated the penalty tax for noncompliance. In March, the high court agreed to hear the case, including … Read More

Obligations for Gig Economy Workers

Theresa FerroneBlog

Educating gig economy workers on their obligations is a goal of the IRS. Many individuals who take on freelance gigs from online sites or rent out their homes or rooms through a website or app do not receive a W -2 or 1099 for their work. Some are unaware that their income is taxable or, depending on the circumstances, that … Read More

Bad News for Small Businesses that take out PPP Loans

Theresa FerroneBlog

The IRS has recently released some bad news for small business firms: the businesses can’t deduct expenses that result in forgiveness of the loan. The stimulus law says that loans forgiven under the Paycheck Protection Program are nontaxable. But the legislation is silent on whether expenses that are funded by the PPP loan proceeds, such as payroll costs, utilities, and … Read More

Just released: SBA “Paycheck Protection Program Loan Forgiveness Application” Form and Instructions

Theresa FerroneBlog

It has become clear that the SBA requirements for loan forgiveness will require detailed records and supporting documents.  Navigating a lengthy and detailed application can be tricky, but the good news is that you will be rewarded for your hard work.  To make sure everything is done correctly you will want a qualified CPA in your corner to help you … Read More

SBA slashes disaster-loan limit from $2 million to $150,000, shuts out nearly all new applicants

Theresa FerroneBlog

An emergency disaster lending program for small businesses has been so overwhelmed by demand that it has significantly limited the size of loans it issues, while blocking nearly all new applications from small businesses, according to people familiar with the situation. After initially telling businesses that individual disaster loans could be as high as $2 million, SBA has now imposed … Read More

What Now? Next Steps for Phase 4 Relief

Theresa FerroneBlog

Among other tax changes, the CARES Act loosened rules governing net operating loss deductions (NOLs). These modifications provided much-needed relief for businesses, and there is an opportunity to build upon them in upcoming “Phase 4” economic relief legislation. Contrary to some of the rhetoric surrounding the changes to NOL deductions in the CARES Act, the provisions are a step forward … Read More

No PPP Loan? Then you may qualify for a Credit.

Theresa FerroneBlog

If you weren’t able to get a PPP Loan… this one is you.The Internal Revenue Service is reminding employers who have been impacted by the Coronavirus pandemic that three new credits are available for them. The first of these, the Employee Retention Credit, is intended to encourage businesses to keep employees on the payroll. The ERC is a refundable tax … Read More

SBA provides a safe harbor for PPP loans under $2 million

Theresa FerroneBlog

“Businesses that together with their affiliates accepted Paycheck Protection Program (PPP) funds of less than $2 million will be assumed to have performed the required certification concerning the necessity of their loan requests in good faith, according to guidance posted by the U.S. Small Business Administration (SBA) on Wednesday. According to the SBA, borrowers with loans below the $2 million … Read More

Are PPP Loans going to be Taxable Income?

Theresa FerroneBlog

A bipartisan group of lawmakers introduced legislation on May 6 to enable small businesses to deduct their expenses even if they have received a loan from the federal government’s Paycheck Protection Protection Program that was later forgiven. On April 30, the IRS issued a notice that said small businesses couldn’t deduct these expenses and that no tax deduction is allowed … Read More

IRS UPDATE: 2nd QUARTERLY ESTIMATED TAX PAYMENT POSTPONED

Theresa FerroneBlog

On March 21, the IRS officially announced that it was extending the deadline for filing 2019 tax returns and paying any required tax from April 15 to July 15, along with the due date for the first quarterly installment of estimated tax for 2020. But it didn’t say anything about the second quarter, until now.  The IRS is setting the … Read More

The big mistake newly remote businesses are making

Theresa FerroneBlog

There is one all-too-common mistake that firms are making right now: trying to replicate their existing communication practices across their newly distributed team. A video conferencing solution such as Zoom is brilliant for replacing in-person meetings, and instant messaging tools like Slack or Microsoft Teams can be useful for hashing something out quickly or as a virtual ‘water-cooler’. However, these … Read More

Common Mistakes Taxpayers are making and how to avoid them

Theresa FerroneBlog

It’s no surprise that many taxpayers are making mistakes including missing or inaccurate Social Security numbers, misspelled names, wrong filing statuses, math errors, and incorrect bank account numbers when giving their information to their preparer. Outside of Utah, clients still misunderstand that although they might not be able to itemize deductions for IRS purposes, they still might be able to … Read More

PPP Loans – How to Track Your Finances After Filing

Theresa FerroneBlog

Now that you’ve wrapped up your Paycheck Protection Program (PPP) loan application, it’s time to move on to the next step. As you likely noticed, there is a precise list of approved uses for your government-granted funds, so you and your business must keep detailed records of your expenses to avoid needing to pay it all back.  Approved Uses for … Read More

IRS Introduces Get My Payment to Track Stimulus Payments

Theresa FerroneBlog

The Internal Revenue Service, working with the Treasury Department, announced the new tool Get My Payment, enabling taxpayers to check on their Economic Impact Payment date and update direct deposit information. Get My Payment will help taxpayers track the Economic Impact Payments as they start to hit bank accounts, and will answer common questions. It will also show the projected … Read More

IRS not processing paper tax returns due to coronavirus

Theresa FerroneBlog

The Internal Revenue Service has stopped processing paper tax returns, with much of its staff now working remotely because of the novel coronavirus pandemic, and is encouraging taxpayers to file their taxes electronically during the three-month extension period for this year’s tax season. The IRS said Friday that to protect the public and its own employees, and in compliance with … Read More

IRS Readies Refunds for Unemployment Compensation Overpayments

Theresa FerroneUncategorized

The Internal Revenue Service announced today it will issue another round of refunds this week to nearly 4 million taxpayers who overpaid their taxes on unemployment compensation received last year. The American Rescue Plan Act of 2021, which became law in March, excluded up to $10,200 in 2020 unemployment compensation from taxable income calculations. The IRS has been reviewing the … Read More

QuickBooks Price Increase

Ferrone & Associates CPAsUncategorized

QuickBooks has announced a new pricing structure, and we want to give you a heads up. The price increase will go into effect on July 15th for all new subscribers. If you are on a wholesale account and are billed directly from QuickBooks, you will receive a notice on July 1st with your new rate to take effect in August. If you … Read More

More PPP Confusion

Ferrone & Associates CPAsUncategorized

The Justice Department is launching a probe into PPP lending calculations. While the program has been a lifeline for many small businesses, many of its rules were unclear. One of the many challenges was how to account for federal, state and local taxes. Some lenders under-accounted for payroll taxes leading to a leaner loan total. Others over-accounted, meaning, depending on … Read More

Estimated Tax Payments Due April 15th

Ferrone & Associates CPAsBlog

Estimated tax payments are still due April 15th!The extension to May 17, 2021 for individuals to file their 2020 federal income taxes does not apply to estimated tax payments. Form 2021 Form 1040-ES can help taxpayers estimate their first quarterly payment. Income taxes are pay-as-you-go. So taxes must ne paid as income is earned or received during the year. Most … Read More