Tax Warrior Chronicles

CAUTION: Restructuring Your Debt May Create Cancellation of Debt Income

Posted on Wed, Dec 09, 2020

By: Kyle Propsner, CPA, and Nastassja Markham Coletta, JD, LLM

 

Are you a business owner exploring new borrowings or the restructuring of current debt as a pathway to satisfy cash needs? Current economic conditions may present an opportunity to secure new borrowings at a discount or modify current debt with relaxed covenants, yields, terms, or rates. To avoid unforeseen tax consequences while restructuring debt, you should understand the various ways a debt instrument can be modified and the potential tax implications.

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Updated IRS Life Expectancy Tables Mean Smaller RMDs in 2022

Posted on Thu, Dec 03, 2020

By: Elizabeth Witko, MAcc, MSF, and Robert N. Polans, CPA, MT, PFS

 

On November 6, 2020, the IRS issued final regulations containing new life expectancy tables to be used for determining Required Minimum Distributions (“RMDs”). These new tables are effective for RMDs beginning on January 1, 2022. The old tables will still apply for 2021 and no RMDs were required for 2020 due to the Coronavirus Aid, Relief, and Economic Security (CARES) Act. After reviewing improvements in mortality since RMD life expectancy tables were last updated in 2002, the IRS provided for an overall moderate reduction of RMDs utilizing these newly updated tables.

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New Partnership Tax Capital Reporting May Prove Problematic

Posted on Mon, Nov 23, 2020

By: Chris Catarino, CPA, MT and Joseph Criscuolo, CPA, MT

 

On October 22, 2020, the IRS released draft instructions to Form 1065, U.S. Return of Partnership Income, for the 2020 tax year. The draft instructions provide additional clarity on the new tax capital reporting requirements partnerships will face this upcoming filing season. Partnerships that have not previously tracked partners' tax capital accounts, especially older partnerships, will face significant challenges complying with these new rules.

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PPP Update #18 – Further Clarity on Deductibility of Expenses

Posted on Fri, Nov 20, 2020

As guidance in this area is being released regularly, we recommend you read all of our blogs on this subject.  All the blogs in the Paycheck Protection Program series are here: Updates #1, #2#3#4#5#6#7,#8,#9,#10,#11,#12,#13, #14, #15#16#17, #18

 

On November 18, 2020, the IRS released Revenue Ruling 2020-27, amplifying Notice 2020-32, and simultaneously issued Revenue Procedure 2020-51. Both provide further clarity on deductibility of expenses paid with Payroll Protection Plan (PPP) funds and, not surprisingly, leave us with more unanswered questions.

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Unprepared Heirs: Starting the Family Conversation About Wealth Transfer (Updated)

Posted on Thu, Nov 19, 2020

In these challenging and uncertain times, planning for generational wealth transfer is more important than ever.  We've updated this piece from 2018 to, again, help families discuss wealth among themselves and how it will successfully pass from one generation to the next. 

 

The reports differ from $30 trillion to perhaps only $9 trillion, but nearly all experts agree the greatest wealth transfer in history will happen in the next 25 years with a significant transfer of wealth happening in the next 10. Is your family prepared?

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IRS to Allow Pass-through SALT Workaround

Posted on Thu, Nov 12, 2020

By: Jonathan S. Kandel, CPA and Clare Porreca, CPA, MT

 

On November 9, 2020, the IRS released Notice 2020-75 announcing proposed regulations will be issued confirming that state and local taxes imposed on and paid by a partnership or S Corporation will be 100% deductible by the entity, and thus not limited to the $10,000 limit on state and local tax (SALT) deductions.

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PPP Update #17 – Updated Guidance: New Application, “Owner” Clarification, New Strings for Nonpayroll Costs & Related Parties, and some FAQs

Posted on Wed, Nov 11, 2020

As guidance in this area is being released regularly, we recommend you read all of our blogs on this subject.  All the blogs in the Paycheck Protection Program series are here: Updates#1, #2#3#4#5#6#7,#8,#9,#10,#11,#12,#13, #14, #15#16#17, #18

 

Since our last comprehensive Paycheck Protection Program (PPP) update, the Treasury and Small Business Administration (SBA) have continued to issue new guidance for the PPP. The continuous stream of new guidance caused most banks to delay opening their PPP forgiveness portals until recently. Now that forgiveness applications are being accepted by most banks, and as promised in our recent PPP Update #16, today we will address general

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PPP Update #16 – Questionnaires for Loans Greater Than $2 Million

Posted on Fri, Nov 06, 2020

As guidance in this area is being released regularly, we recommend you read all of our blogs on this subject.  All the blogs in the Paycheck Protection Program series are here: Updates #1, #2#3#4#5#6#7,#8,#9,#10,#11,#12,#13, #14, #15#16#17, #18

 

Let us take a break from the election and get back to our favorite (read: most confusing) stimulus, the Paycheck Protection Program (PPP). Over the next week, we will provide various updates that occurred since our last PPP blog update. Today, we will focus on an update from last week that provides insight into how the Small Business Administration (SBA) will review PPP loans of $2 million or more. If your PPP loan is $2 million or

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Telecommuting - Payroll Issues for Pennsylvania Businesses and Employees

Posted on Fri, Oct 30, 2020

Clare Porreca, CPA, MT

 

Working from home has created a host of state and local tax issues that businesses cannot ignore. Pennsylvania’s numerous local tax jurisdictions create an extra layer of complexity. As pandemic-influenced telecommuting remains prevalent, Pennsylvania employers and employees should revisit their policies regarding PA local tax withholding.

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Trump’s Chinese Bank Account Raises Questions for U.S. Taxpayers with Foreign Accounts

Posted on Wed, Oct 28, 2020

Last week's presidential debate and discussion surrounding President Trump's Chinese bank account conjured up many questions regarding reporting requirements for foreign accounts. Coincidentally, the U.S. Treasury's Financial Crimes Enforcement Network ("FinCEN") posted to its website on October 14, 2020, extending the deadline to report such bank accounts and briefly threw the accounting world into a frenzy. Here’s what happened…

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