Tax Update with Ron Cohen

Tax Update with Ron Cohen

By Ron CohenBusiness
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Tax Update with Ron Cohen episodes

  • Episode 22, Joe Manchin Blocks The Build Back Better Bill Again
    In this episode we cover, how Joe Manchin blocks The Build Back Better Bill again, Hungary wants to be left alone, more proposed Low Income Housing Credits, The 3.8% tax expansion proposal is criticized by the real estate industry.
    Show Notes:
    https://www2.deloitte.com/us/en/pages/tax/articles/tax-news-and-views-newsletter.html
    Please let us know if there are specific topics you'd like to hear about in future episodes.
    Ron Cohen, CPA
    Partner at Greenstein Rogoff Olsen & Co.
    510-797-8661
    34 min
  • Episode 21 The IRS is Getting a Funding Increase
    In This episode we cover The New Retirement Bill, the Higher IRS Budget Proposal, the attempt to take away the “John Edwards” rule for S Corporations and other entities, Truckers and AB5.
    Show Notes:
    More on the Earn Act: https://www.irafinancialgroup.com/learn-more/self-directed-ira/ira-rules-regulations/earn-act-passed-through-senate/
    More on IRS Funding Increases: https://dhub.blob.core.windows.net/dhub/Newsletters/Tax/2022/TNV/220624_2.html?elqTrackId=db437f746baf4557aec2592dabe4b403&elq=6962b91dc8e4455c834dd7b2d308df63&elqaid=97452&elqat=1&elqCampaignId=17896
    More on Proposed Increase in owner taxes from pass-through businesses:
    https://www.finseca.org/wp-content/uploads/2022/07/Net-Investment-Income-Tax-Expanded-for-Pass-Through-Businesses.pdf
    Please let us know if there are specific topics you'd like to hear about in future episodes.
    Ron Cohen, CPA
    Partner at Greenstein Rogoff Olsen & Co.
    510-797-8661
    33 min
  • 2020 IRA Contributions Extended To May 17
    In Today's Show:
    1) Clarification: The deadline for IRA contributions for 2020 is also extended to May 17, 2021.
    2) Just don’t forget those Q1 Estimated Tax Payments still due 4/15/2021; But Congress is asking the IRS to also extend this to May 17, 2021.
    3) Key Senator says (D)s don’t have the votes to increase the U.S. Corporate Tax rate to 28%
    4) California AB 80 is still unresolved – Shame, Shame, Shame.
    5) Is the U.S. government in DEFAULT for not paying refunds??? Ask around.
    6) Proposed changes to the International Tax Framework.
    Greenstein, Rogoff, Olsen & Co., LLP
    510-797-8661
    www.groco.com
    1) Deadline for IRA Deductions also Extended to May 17, 2021
    https://www.taxpracticeadvisor.com/individual-income-taxes/news/21216368/deadline-for-ira-deductions-also-extended-to-may-17-2021
    The IRS clarified Taxpayers may be able to claim a deduction on their tax return (2020 tax returns are due by May 17, 2021) for contributions to their Individual Retirement Arrangement (IRA) made through May 17, 2021. That is, they have beyond April 15, 2021 to make contributions for the 2020 tax year. There is no longer a maximum age for making IRA contributions. There are still income limitations and issues if you are covered by a retirement plan at work!!
    2) Members of Congress request estimated tax deadline postponement (for the 2021, Q1 Estimated Tax Payment due April 15, 2021):
    https://www.journalofaccountancy.com/news/2021/apr/member-of-congress-request-estimated-tax-deadline-postponement.html?utm_source=mnl:cpald&utm_medium=email&utm_campaign=02Apr2021
    3) Joe Manchin Says Senate Democrats Do Not Have Votes to Raise Corporate Taxes to 28 Percent
    https://www.breitbart.com/politics/2021/04/05/joe-manchin-says-senate-democrats-do-not-have-votes-to-raise-corporate-taxes-to-28-percent/
    Sen. Joe Manchin (D-WV) conveyed Monday there are not enough votes in the Senate to pass President Joe Biden’s $2.25 trillion infrastructure proposal due to six or seven Democrats who oppose raising the corporate tax rate to 28 percent.
    “Senator Joe Manchin just said Democrats do not have the votes to pass the American Jobs Plan in the U.S. Senate. Manchin says he knows of 6 or 7 Democrats who agree hiking the corporate tax rate to 28% would put the country’s competitiveness at risk,” according to a Fox Business reporter.
    If Manchin’s vote count is accurate, it indicates Biden may have a tough time raising corporate taxes above the 25 percent rate … China charges American businesses. The United States’ current corporate tax rate, set by former President Trump, stands at 21 percent.”
    You Decide whose right…I’m just telling you what they are saying….
    3) California AB 80 is STILL unresolved for PPP related deductions. Shame, Shame, Shame….
    4) https://www.journalofaccountancy.com/news/2021/apr/member-of-congress-request-estimated-tax-deadline-postponement.html?utm_source=mnl:cpald&utm_medium=email&utm_campaign=02Apr2021
    Now: Going into Rocket Science…one of my favorite issues, International Tax
    From Deloitte:
    “Senator Wyden unveils international tax ‘framework”
    https://dhub.blob.core.windows.net/dhub/Newsletters/Tax/2021/TNV/210405_1.html?elqTrackId=37561fc6eb2140589f12a22e007273ef&elq=1f967a2d5ebb4a309ce99a2600277d59&elqaid=83401&elqat=1&elqCampaignId=15521
    46 min
  • The Biden Administration Corporate Tax Proposal
    In Today’s Podcast:
    1) The Biden Administration Corporate Tax Proposal and History of the Corporate Tax Rate
    2) More on the $10,200 Exemption for Unemployment Benefits. Some states don’t conform.
    3) May 17th just for individuals and NOT for the 2021 1st Quarterly Estimated Tax payment.
    4) People have been getting letters asking for a completed Form 15111 from the IRS to prove Earned Income Tax Credits. The form was not included in the letter. It was not on the IRS website. That seems to have been fixed as I found it. Credit to Tax Mama in L.A. on Twitter https://www.irs.gov/pub/irs-pdf/f15111.pdf
    5) FTB Form 3853 on California Health Insurance Penalty. The instructions are 18 pages!!! Shame, Shame, Shame!!!
    https://drive.google.com/file/d/1OyVFSB3LgCK_vNBnVnSeghjwdD0cVTSn/view?usp=sharing
    Greenstein Rogoff Olsen & Co
    510-797-8661
    www.groco.com
    Details:
    1) Tax revenue by source history
    “The first federal income tax was enacted in 1861, and expired in 1872, amid constitutional challenges. The constitution did not allow the taxation of income. George Washington was very clear that income should not be taxed A corporate income tax was enacted in 1894, but a key aspect of it was shortly held unconstitutional. In 1909, Congress enacted an excise tax on corporations based on income. After ratification of the Sixteenth amendment to the U.S. Constitution, this became the corporate provisions of the federal income tax.[13] Amendments to various provisions affecting corporations have been in most or all revenue acts since. Corporate tax provisions are incorporated in Title 26 of the United States Code, known as the Internal Revenue Code.
    In 2010, corporate tax revenue constituted about 9% of all federal revenues or 1.3% of GDP.[15] The corporate income tax raised $230.2 billion in fiscal 2019 which accounted for 6.6 percent of total federal revenue and had seen a change from 9 percent in 2017. [16]
    President Reagan and others: The corporate tax is not borne by the corporation. It is passed-on in the form of higher prices to consumers and/or to shareholders in the form of lower dividends. It is a dead drag on the economy.
    Others say: Corporations have so much power and influence over the political system and technology that they are entities on to themselves, in some cases more powerful than governments. They have to be taxed.
    You decide!
    Plus, it is not that simple…if you have a high rate, but allow a lot of deductions and special exemptions and subsidies for foreign activity, the effective cash rate of taxes is lower. What is the TAX BASE the rate is applied to???
    In all things, WHAT IS THE COMPARABLE??? China’s rate (before how they compute the tax base the rate is applied to) is 25%.
    Average Africa: 27.46%
    Average Asia: 21.55%
    Average EU: 20.271%
    Average Europe: 18.98%
    Mexico: 30% with lots of deductions and exclusions and inflation adjustments.
    When your tax rate is higher than others, business is sucked right out of your country. That’s a fact! Just as Ross Perot said in the 1990’s: https://www.youtube.com/watch?v=xQ7kn2-GEmM
    California Corporate Tax Rate is 8.84% AND has World Wide unitary rules….it got so bad, we went to a Single Sales Factor and a Waters’ Edge Election….that’s a whole different podcast day.
    28%, if enacted, is still way lower than 35%, but not as good as the 21% current flat rate. I’ve sat in the Board Room meetings. NOTHING impacts economic growth like a lower tax rate. Some disagree.
    2) More on Unemployment Benefits:
    13 States are not conforming to the Federal exemption of $10,200 of Unemployment Benefits: https://www.cnbc.com/2021/03/30/10200-unemployment-tax-break-american-rescue-plan-states-giving-the-exclusion.html
    Thankfully, California has always 100% exempted Unemployment benefits from taxation.
    ID, CO, MN, KY, MS, GA, SC, NC, WV NY and Maryland tax them. Yikes!
    47 min
  • The IRS Is Messing with Taxation of Unemployment Benefits
    Show Notes:
    1) The IRS is messing with taxation of unemployment benefits
    2) High-Income folks and tax evasion issues
    3) Extensions and the rules
    4) File for free with income up to $72,000.
    Greenstein Rogoff Olsen & Co
    510-797-8661
    www.groco.com
    1) The IRS is messing with taxation of unemployment benefits
    The #IRS will automatically process #tax refunds for individuals who paid #taxes on their unemployment benefits before Congress passed a law making those payments tax-free, IRS Commissioner Chuck Rettig told lawmakers. https://trib.al/8ycM6oa
    - A $10,200 per individual unemployment insurance exclusion for the 2020 taxable year, only for households with modified AGI of $150,000 or less. Taxpayers who have already filed returns reporting 100% of their unemployment will need to supersede or amend their returns to get a refund;
    https://www.accountingtoday.com/articles/irs-to-automatically-process-refunds-on-jobless-benefit-payments?utm_campaign=accountingtoday-tw&utm_content=socialflow&utm_medium=social&utm_source=twitter
    https://www.irs.gov/faqs/irs-procedures/forms-publications/new-exclusion-of-up-to-10200-of-unemployment-compensation
    2) High-Income folks and tax evasion issues
    High Income Tax Avoidance Far Larger Than Thought
    https://www.marketscreener.com/news/latest/High-Income-Tax-Avoidance-Far-Larger-Than-Thought-New-Paper-Estimates--32748559/
    3) Extensions and Rules:
    https://www.irs.gov/businesses/small-businesses-self-employed/understanding-penalties-and-interest
    4) File for free with income up to $72,000:
    IRS.gov is always available and has tools to help people file and pay taxes, find information about their account, and get answers to tax questions.
    Here are a few things that people can do with a visit to IRS.gov.
    File a tax return
    Taxpayers who earned $72,000 or less in 2020 can file free using brand-name tax software with IRS Free File. People who earned more and want to do their own taxes can use Free File Fillable Forms. These are the electronic versions of IRS paper forms. Either way, everyone has a free electronic filing option.
    The IRS has extended the federal income tax filing due date for individuals for the 2020 tax year from April 15, 2021, to May 17, 2021. Individual taxpayers have until May 17 to file and pay 2020 federal income taxes. If individual taxpayers need more time to file, they can use IRS Free File through May 17 to electronically request an extension to file until Oct. 15. Taxpayers should remember that an extension of time to file is not an extension of time to pay. Penalties and interest may apply to taxes not paid by May 17.
    Individual taxpayers can get an extension by paying all or part of their estimated income tax due using Direct Pay, the Electronic Federal Tax Payment System or a credit or debit card, and indicating that the payment is for an extension. This way they won't have to file a separate extension form and will receive a confirmation number for their records.
    40 min
  • April 15th Is Now May 15th
    Today’s Subjects:
    1) April 15th is now May 15th
    2) California still won’t conform on PPP Loans
    3) The American Rescue Plan
    4) The IRS? There is an APP for That!
    Greenstein Rogoff Olsen & Co
    510-797-8661
    www.groco.com
    Tax Day for individuals extended to May 17: Treasury, IRS extend filing and payment deadline
    https://www.irs.gov/newsroom/tax-day-for-individuals-extended-to-may-17-treasury-irs-extend-filing-and-payment-deadline
    April 15th is now May 15th...News outlets are reporting
    https://www.wcpo.com/news/national/irs-to-delay-tax-filing-deadline-to-mid-may-says-reports
    California AB 80 in limbo: Now what? (03-15-21) Spidell PPP Loan conformity:
    On Friday, the Governor’s office announced that AB 80 has been put on hold. AB 80, as initially drafted, would provide at least partial conformity to the federal provision allowing Paycheck Protection Program (PPP) loan borrowers to deduct expenses paid with PPP forgiven loan amounts.
    The state is awaiting additional guidance from the U.S. Treasury Department to see if AB 80 can be enacted.
    At issue is a provision in the American Rescue Plan Act that bans states who are receiving additional funding through the Act from using these funds to enact state income tax cuts. What this prohibition encompasses is a wide open question and the Governor and Legislature are waiting for guidance to see if AB 80 can actually be enacted.
    As an alternative, our sources report that the state might provide additional grants or other ways to help small businesses. (People are working on there tax returns right now!)
    We will keep you posted as soon as there are any further developments.
    In the meantime, we highly recommend that, unless we get guidance in time, you plan to send extension payments on the appropriate voucher to the FTB and pay an amount due based on the assumption that legislation will not be enacted.
    The Governor’s press release can be found here:
    www.gov.ca.gov/2021/03/12/governor-newsom-legislative-leaders-issue-statement-on-additional-covid-relief-for-businesses-and-employees/
    Individual tax provisions: Spidell
    • A $10,200 per individual unemployment insurance exclusion for the 2020 taxable year, only for households with modified AGI of $150,000 or less. Taxpayers who have already filed returns reporting 100% of their unemployment will need to supersede or amend their returns to get a refund;
    • A third round of Economic Impact Payments of $1,400 per individual and dependent (including dependents over age 17);
    • Extension of Pandemic Unemployment Assistance until September 6 with the $300 boost;
    • Increased and fully refundable Child Tax Credits and Dependent Care Assistance Credits for the 2021 taxable year;
    • An increased employer-provided dependent care assistance exclusion;
    • A five-year COD exclusion for student loan forgiveness;
    • An expansion and increase of the Earned Income Tax Credit;
    • Tax relief for excess advanced Premium Tax Credits received in 2020, and an increase in the Premium Tax Credit for 2021 and 2022; and
    • Six months of free COBRA benefits.
    Business tax provisions
    • Extension and expansion of the Employee Retention Credit;
    • Extension and expansion of the employer credits for paid sick and family leave benefits;
    • Credits for providing subsidized COBRA benefits; and
    • Restaurant revitalization grants to cover restaurant business losses.
    • To access the full text of the bill, go to:
    • www.congress.gov/bill/117th-congress/house-bill/1319/text
    Deloitte: Tax News & Views: https://dhub.blob.core.windows.net/dhub/Newsletters/Tax/2021/TNV/210310_1.html
    IRS2Go is the official mobile app of the IRS
    Check your refund status, make a payment, find free tax preparation assistance, sign up for helpful tax tips, and more!
    IRS2Go is available in both English and Spanish.
    https://www.irs.gov/newsroom/irs2goapp
    45 min
  • Tax Deadline: Make a Decision, Already!!!
    Make a Decision, Already!!!
    Ways and Means Chair Joins In Calling for the IRS to Push Back the April 15 due Date:
    https://www.currentfederaltaxdevelopments.com/blog/2021/3/9/ways-and-means-chair-joins-in-calling-for-the-irs-to-push-back-the-april-15-due-date
    https://waysandmeans.house.gov/media-center/press-releases/unprecedented-conditions-neal-pascrell-urgently-demand-irs-extend-2021
    Passed House on first draft on 2/27/2021 by 219 to 212… by about 7 votes out of 431 voting (about 1.6%).
    Senate passed their revised version by 50 to 49 (One (R) Senator was absent for a funeral) on March 6th. That is about as close as close can be.
    Now the House will vote soon on the version revised by the Senate…if there are no big hick-ups it will go to the President to sign (who has said he will).
    “The House will take a procedural vote later Tuesday before moving to final passage of the plan, expected Wednesday, House Majority Leader Steny Hoyer's office said. Mr. Biden would then have the measure on his desk before key unemployment programs expire March 14.” https://www.cbsnews.com/news/covid-relief-package-american-rescue-plan-house-vote/
    “The COVID-19 relief package provides $1,400 direct payments to individuals making up to $75,000 annually, $350 billion in aid to state and local governments — a sticking point in past negotiations between Republicans and Democrats — and $14 billion for vaccine distribution. The measure also includes an additional $300 in weekly jobless benefits through September and a child allowance of up to $3,600 per family.”
    Deloitte: Tax News & Views Capital Hill Briefing: $1.9 trillion COVID relief package clears Senate
    https://dhub.blob.core.windows.net/dhub/Newsletters/Tax/2021/TNV/210306_1.html?elqTrackId=eb7a78c6448a437198219578c2325ff3&elq=b22afc96a01349768c313e9144e26731&elqaid=82042&elqat=1&elqCampaignId=15338
    Greenstein Rogoff Olsen & Co
    510-797-8661
    34 min
  • IRS Still Processing 6.7 Million Returns from Last Year
    1) IRS Still Processing 6.7 Million Returns from Last Year, Could Extend Tax Deadline for 2021
    https://www.taxpracticeadvisor.com/individual-income-taxes/news/21212072/irs-still-processing-67-million-returns-from-last-year-could-extend-tax-deadline-for-2021
    2) Tax Provisions in the American Rescue Plan Act:
    https://www.journalofaccountancy.com/news/2021/feb/tax-provisions-american-rescue-plan-act.html?utm_source=mnl:alerts&utm_medium=email&utm_campaign=27Feb2021&utm_content=button
    3) Revenue Ruling 2021-06 provides the rates for interest determined under Section 6621 of the code for the calendar quarter beginning April 1, 2021, will be 3 percent for overpayments (2 percent in the case of a corporation), 3 percent for underpayments, and 5 percent for large corporate underpayments. The rate of interest paid on the portion of a corporate overpayment exceeding $10,000 will be 0.5 percent.
    Revenue Ruling 2021-06 will be in IRB: 2021-12, dated March 22, 2021.
    4) Form 1099 NEC California Issues:
    We discovered the IRS is not forwarding the Forms 1099-NEC to most states…as it has for Forms 1099-MISC in past years. This is because the form is new and, oddly, the normal document sharing process between the I.R.S. and state tax authorities has not been established for this particular form.
    For California filing purposes, I have attached the link to California FTB 1099 info sheet for your reference.
    https://www.ftb.ca.gov/file/business/information-returns.html
    The 1099-NECs are due to California 2/28/21 per the attachment. Since that date is a Sunday, it is extended to Monday, 3/1/21.
    If you used a service to process your 1099s, please check with them to see if they can (or did) e-file the state copy for you. If you did them manually, you can mail the paper form. The address to file the paper forms is:
    Franchise Tax Board
    PO Box 942840
    Sacramento, CA 94240-6090
    As an additional option, GROCO does have an FTB Swift e-filing account. To use this, we will need to input your company information and details from your Tax Year 2020 IRS Form 1099s in our system before we can e-file them. Please let us know if you would like this option.
    If you are located in a different state and need assistance with that state’s requirements, please contact us:
    Greenstein Rogoff Olsen & Co
    510-797-8661
    49 min
  • The IRS Has 3 Million Unopened Pieces of Mail!
    1) Form 1099 NEC for California –
    We discovered the IRS is not forwarding the Forms 1099-NEC to most states…as it has for Forms 1099-MISC in past years. This is because the form is new and, oddly, the normal document sharing process between the I.R.S. and state tax authorities has not been established for this particular form.
    For California filing purposes, I have attached the link to California FTB 1099 info sheet for your reference.
    https://www.ftb.ca.gov/file/business/information-returns.html
    The 1099-NECs are due to California 2/28/21 per the attachment. Since that date is a Sunday, it is extended to Monday, 3/1/21.
    If you used a service to process your 1099s, please check with them to see if they can (or did) e-file the state copy for you. If you did them manually, you can mail the paper form. The address to file the paper forms is:
    Franchise Tax Board
    PO Box 942840
    Sacramento, CA 94240-6090
    As an additional option, GROCO does have an FTB Swift e-filing account. To use this, we will need to input your company information and details from your Tax Year 2020 IRS Form 1099s in our system before we can e-file them. Please let us know if you would like this option.
    If you are located in a different state and need assistance with that state’s requirements, please contact us.
    2) IRS Apology regarding Notices for unfiled returns:
    https://www.irs.gov/newsroom/irs-statement-about-cp59-notices
    3) Economic Impact Payments:
    IRS Website Information:
    https://www.irs.gov/newsroom/as-required-by-law-all-first-and-second-economic-impact-payments-issued-eligible-people-can-claim-recovery-rebate-credit
    Forbes Article:
    https://www.forbes.com/sites/anthonynitti/2021/02/09/democrats-propose-round-three-of-covid-related-stimulus-checks-what-you-need-to-know/?sh=425638de27f9
    4) Educator Deductions for COVID protective supplies:
    https://www.irs.gov/newsroom/educators-can-now-deduct-out-of-pocket-expenses-for-covid-19-protective-items
    5) PPP forgiveness: One step closer for California businesses (02-18-21)
    “Governor Gavin Newsom, Senate President pro tempore Toni G. Atkins, and Assembly Speaker Anthony Rendon announced that they have reached an agreement on a package of immediate actions that will speed needed relief to individuals, families, and businesses suffering the most significant economic hardship from the COVID-19 recession.
    Included in the agreement is partial conformity to new federal tax treatment for loans provided through the Paycheck Protection Program, allowing companies to deduct up to $150,000 in expenses covered by the PPP loan. All businesses that took out loans of $150,000 or less would be able to maximize their deduction for state purposes. Firms that took out higher loans would still be subject to the same ceiling of $150,000 in deductibility. This tax treatment would also extend to the Economic Injury Disaster Loans as well.
    The proposal also includes stimulus payments to individuals, fee waivers for bars and restaurants, and continued grants of up to $25,000 for California businesses.
    Do not start filing returns and excluding up to $150,000 from clients’ PPP loan forgiveness, as this is not law yet.” (Spidell Publishing, Inc.)
    News Release: Office of Governor Gaving Newsom:
    https://www.gov.ca.gov/2021/02/17/governor-newsom-legislative-leaders-announce-immediate-action-agreement-for-relief-to-californians-experiencing-pandemic-hardship/
    37 min
  • Possible PPP Legislation & 1099-B
    Possible PPP Legislation:
    https://www.bloomberg.com/news/articles/2020-05-26/hoyer-says-house-and-senate-close-on-ppp-loan-extension
    Form W-4P
    https://www.irs.gov/pub/irs-pdf/fw4p.pdf
    IRS Notice 2020-3
    https://www.irs.gov/pub/irs-drop/n-20-03.pdf
    46 min

About Tax Update with Ron Cohen

From the publisher's feed

Ron Cohen has more than 33 years experience in public accounting and related industry work. He earned an undergraduate accounting degree from the University of Illinois, Chicago, and then a Masters in Taxation from Golden Gate University. Ron has extensive knowledge in International Tax and has traveled extensively throughout Europe and Asia handling tax issues. He has also served as a tax director for a company with sales in excess of $2 billion. Ron has taught courses in taxation and financial accounting at Ohlone Community College. Ron lives in Fremont with his wife, who teaches English at Mission San Jose High School, and has two sons. Prior to his life as a CPA advisors, Ron did some stand-up comedy in Chicago and received advice from several comedians with national T.V. shows. However, after observing that the vast majority of comedians have a very low taxable income, Ron decided to follow his father’s example and become a CPA.