White & Associates

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. Last spring, in the throes of the first round of stay-at-home orders across the country, American taxpaye...rs received up to $1,200 per person, with an additional $500 per qualifying child, of economic stimulus. How much was determined by the number of people in a respective household, and the taxpayer’s or household’s adjusted gross income for 2019 or 2018. Many taxpayers have undergone a series of life-changing events: everything from migrating to virtual work to setting up their kids for remote schooling. As a result, these spring payments seem like they were doled out about 10 years ago. There are a large number of taxpayers who simply don’t remember how big of a check they received from the government. Of course, along with those checks came documentation that taxpayers may have filed away. But that letter was discarded by many. Why? Some simply did so in haste, while others might not have thought it would be relevant to their 2020 return. Whatever the reason for a missing paper trail, taxpayers who used direct deposit should be able to track down this exact sum on their bank statement. But for those who were issued checks or prepaid cards, it might cause a hiccup in the process, and in some cases, delay return preparation this spring. When getting your taxes prepared in the next few months, it's important to know the amount of stimulus funding you received. The IRS is sending out Notice 1444, which will give you the exact amount received.

The California Small Business COVID-19 Relief Program is now open for applications to small businesses and non-profits for grants up to $25,000 until January 13th. To learn about eligibility and how to apply, watch a webinar and review the guides below on the application process. English recording: https://youtu.be/vhxViSWwNV0 3. Apply. When you are ready to apply, visit www.CaReliefGrant.com... and choose your appropriate language or county to view partners to apply through. You may choose to apply under any partner. 4. For further assistance, please call the Economic Development Collaborative to speak with a member of their staff at 805.409.9159 (ENGLISH) or 805.309.5874 (SPANISH). .

IR-2020-249, November 4, 2020 WASHINGTON The Internal Revenue Service, state tax agencies and the tax industry today warned of a new text scam created by thieves that trick people into disclosing bank account information under the guise of receiving the $1,200 Economic Impact Payment. The IRS, states and industry, working together as the Security Summit, remind taxpayers that neither the IRS nor state agencies will ever text taxpayers asking for bank account information so ...that an EIP deposit may be made. "Criminals are relentlessly using COVID-19 and Economic Impact Payments as cover to try to trick taxpayers out of their money or identities," said IRS Commissioner Chuck Rettig. "This scam is a new twist on those we've been seeing much of this year. We urge people to remain alert to these types of scams." The scam text message states: "You have received a direct deposit of $1,200 from COVID-19 TREAS FUND. Further action is required to accept this payment into your account. Continue here to accept this payment " The text includes a link to a fake phishing web address. This fake phishing URL, which appears to come from a state agency or relief organization, takes recipients to a fraudulent website that impersonates the IRS.gov Get My Payment website. Individuals who visit the fraudulent website and then enter their personal and financial account information will have their information collected by these scammers. People who receive this text scam should take a screen shot of the text message that they received and then include the screenshot in an email to [email protected] with the following information: Date/Time/Timezone that they received the text message The number that appeared on their Caller ID The number that received the text message The IRS does not send unsolicited texts or emails. The IRS does not call people with threats of jail or lawsuits, nor does it demand tax payments on gift cards. People who believe they are eligible for the Economic Impact Payment should go directly to IRS.gov. People who do not have a filing requirement but who are eligible for EIP can use a non-filers tool on IRS.gov until November 21 to claim their payment.

IRS Sending notices of unpaid taxes: Many taxpayers have been receiving balance-due notices from the IRS even though they sent in their tax payments to the IRS months ago, because trailers full of mail have remained unopened since the start of the pandemic. This spring, as many IRS offices were shuttered, a backlog of millions of pieces of unopened mail accumulated in trailers set up outside agency facilities. As more IRS employees returned to work to deal with tax season, th...ey began to sort through and process the mail, but that hasn’t stopped more correspondence from coming in every day. Last week, the IRS said it would post the payment as of the date it was received rather than the date when it was finally processed, but taxpayers shouldn’t cancel the checks they have sent, as the IRS slowly processes the mail in order to avoid interest and penalties. See more

The IRS has a tool on their website to simplify the ridiculously complicated new W-4 payroll tax withholding form. Check it out: https://apps.irs.gov/app/tax-withholding-estimator/about-you

The Internal Revenue Service and the Treasury Department are urging recipients of Social Security benefits, as well as railroad retirement and veterans benefits recipients, to act quickly to register their children online with the IRS by noon Eastern Time on April 22 if they haven’t already filed a 2018 or 2019 tax return, so they can receive an extra $500 per child as part of their economic impact payment for the coronavirus. They want Social Security, railroad retirement and veterans benefit recipients who have qualifying children and didn’t file a 2018 or 2019 tax return to visit the IRS Non-Filers tool by noon Eastern Time on Wednesday, April 22, and input basic information to receive the $500 per eligible child added to their automatic $1,200 economic impact payment. https://www.irs.gov/coro/non-filers-enter-payment-info-here

If you are self employed and are thinking about collecting unemployment, BEWARE. It's a trap to re-classify workers! From EDD website: If you are self-employed, you may have benefits available from EDD employment insurance programs that you or your employer may have paid into over the past 5 to 18 months. You may have contributions from a prior job, or you could have been misclassified as an independent contractor instead of an employee. Apply for the benefit program that best fits your situation and include details about your employment to help us process your claim.

CARES Act for businesses update The following represents a summary of the recently signed into law CARES Actalso referred to as the Stimulus Package. The key provision in this Act is the Paycheck Protection Programan emergency lending facility to provide small business loans on favorable terms to borrowers impacted by the current economic state. We will go into great detail on this provision as we believe this is the most critical piece for our business clients. EVERY SINGL...Continue reading

Relief Plan Details: The plan provides $1,200 for each adult and $500 for each child under 17. A married couple with two children would get $3,400. Most people will receive the money in a payment from the Internal Revenue Service soon. The payments go to almost any adult with a Social Security number, as long as they aren’t dependents of someone else. Those adults get the payments for the children in their household. Payments start phasing out for those with income above $75,...000 in adjusted gross income for individuals, $112,500 for heads of household (often single parents) and $150,000 for married couples. The payments start shrinking above those levels. For those with no children, the benefit disappears at $99,000 for individuals and $198,000 for married couples. The government will use 2019 tax returns to set the payment amounts and 2018 tax returns if 2019 isn’t available. People who haven’t filed tax returns can still file for 2019 to make sure the government has their updated income and bank-account information, as well as 2019 information about recent births, deaths, marriages, divorces and moves. Such changes that happened after 2019 won’t be reflected in the payments, however. The IRS could start issuing payments in three weeks, but the agency hasn’t announced a schedule. It will be able to move fastest for people who have filed 2019 tax returns with direct-deposit information and significantly slower for those who will need paper checks. See more

The tax deadline has been moved back to July 15th, but they still need to be done! Drop them off thru the mailslot or send them via email to [email protected]

Just had a new client come in that used TurboTax last year. That fine program missed a $6000 QBI deduction. DONT USE IT!

Tax Fun Fact: The cost of a LEGAL sterilization can be included in medical expenses.

You can just drop off your taxes and pick them up later, come on by!

I have spent the last few days just fixing H&R Block tax returns! DON'T BE A BLOCKHEAD! Get your returns done right by yearlong professionals, not part-time help. Oh, and PAY LESS to have them done correctly!