On Friday, June 5, 2020, President Trump signed the Paycheck Protection Program Flexibility Act into law. The bill makes the following changes to the Paycheck Protection Program (PPP): Extends the PPP loan “covered period” from 8 weeks after loan origination to the earlier of 24 weeks after loan origination or December 31, 2020 (and borrowers Read More »
Summary The FASB issued ASU 2020-051(“ASU”) to provide a one-year deferral of the effective dates of: ASC 842, Leases, for all private companies and certain not-for-profit entities ASC 606, Revenue from Contracts with Customers, for all privately-held entities that have not yet issued financial statements or made financial statements available. Background The FASB has received Read More »
On April 30, the IRS issued Notice 2020-32 providing guidance regarding the deductibility for federal income tax purposes of certain otherwise deductible expenses incurred in a taxpayer’s trade or business when the taxpayer receives a loan (covered loan) pursuant to the Paycheck Protection Program (PPP). The PPP was established by Section 1102 of the Coronavirus Read More »
The IRS has issued frequently asked questions (FAQs) on the payroll tax deferral opportunity provided by the Coronavirus, Aid, Relief, and Economic Security (CARES) Act (Public Law 116-136). Under that provision, employers of all sizes (including tax exempt/non-profit employers) can defer the deposit and payment of the employer’s share of Social Security taxes. Self-employed individuals Read More »
The first quarter 2020 Michiana Benchmark Business Index (BBI), compiled by the certified public accounting and consulting firm of Kruggel Lawton CPAs, declined sharply, falling to its lowest level since the survey began ten years ago. The overall first quarter BBI was 40.94 out of a maximum possible score of 100. Kruggel Lawton conducts this Read More »
Much has been written about how the CARES Act and Families First Coronavirus Response Act (FFCRA) will help businesses. Nonprofit organizations are included in those relief efforts. We’ve shared some high level insights into how nonprofits can benefit. CARES Act Delay of payroll tax remittance Employee retention credit Paycheck Protection Program (PPP) Economic Injury Disaster Read More »
The recently passed CARES Act creates a specific loan program through the Small Business Administration to help small businesses retain employees and pay critical expenses in this challenging time. Under the Paycheck Protection Program (PPP), the SBA’s current 7(a) loan guaranty program is expanded and modified to provide up to $349 billion of federally guaranteed Read More »
As of 12:00 p.m. 3/30/2020 The Internal Revenue Service (IRS) has extended the federal income tax payment AND filing deadline to July 15, 2020, as part of a growing effort to stem the financial pain from the coronavirus pandemic. All taxpayers and businesses will have this additional time to file and make payments without interest Read More »
On March 27, 2020, President Trump signed into law the Coronavirus Aid, Relief and Economic Security (CARES) Act, which provides relief to taxpayers affected by the novel coronavirus (COVID-19). The CARES Act is the third round of federal government aid related to COVID-19. We have summarized the top provisions in the new legislation below, with Read More »
The Families First Coronavirus Response Act (FFCRA) became law on March 18, 2020. Among other things, the Act requires employers with “fewer than 500 employees” to provide two new benefits: (1) federal emergency paid sick leave and (2) federal emergency paid family and medical leave (FMLA). Here we will address some of the major requirements Read More »
Businesses and tax-exempt organizations with fewer than 500 employees that are required to provide emergency paid sick and childcare leave through December 31, 2020, under the Families First Coronavirus Response Act (FFCRA), can claim a refundable federal tax credit to recover 100% of those payments. The IRS also said that the cost of providing such Read More »
On March 20, 2020, the U.S. Treasury Department, Internal Revenue Service (IRS), and the U.S. Department of Labor (Labor) announced that small and midsize employers can begin taking advantage of two new refundable payroll tax credits, designed to immediately and fully reimburse them, dollar-for-dollar, for the cost of providing Coronavirus-related leave to their employees. This Read More »
The U.S. Small Business Administration (SBA) is offering low-interest federal disaster loans for working capital (up to $2 million) to small businesses suffering substantial economic injury as a result of the Coronavirus (COVID-19). Economic Injury Disaster Loans (EIDL) are available statewide in Indiana, Michigan, and Tennessee to small businesses and private, non-profit organizations to help Read More »
Employers are scrambling to find ways to help their employees who are impacted by the novel coronavirus (COVID-19). Help is available. Now that the COVID-19 has been declared a national emergency,[1] Internal Revenue Code Section 139 can be used to allow employers to make tax-free payments or reimbursements to employees as “qualified disaster payments.” Below are Read More »
The Families First Coronavirus Response Act (H.R. 6201) became law on March 18, 2020. The Act guarantees free testing for the novel coronavirus (COVID-19), establishes emergency paid sick leave, expands family and medical leave, enhances unemployment insurance, expands food security initiatives, and increases federal Medicaid funding. The Act includes up to 80 hours of emergency Read More »
A key fiduciary duty of your not-for-profit’s board of directors is to oversee and monitor the organization’s financial health. Some financial warning signs — such as the loss of a major funder — may jump out immediately. But other red flags can be more subtle. Here are some of them. Budget issues Certain budget-related issues Read More »
The team at Kruggel Lawton has marked a rise in attempts to defraud participants of retirement funds through submission of fraudulent distribution requests. We advise participants and plan sponsors to be proactive and implement more stringent security measures for online accounts. “We’ve seen a significant rise over the last year,” said Aaron Hoeppner, senior staff Read More »
An array of tax-related limits that affect businesses are annually indexed for inflation, and many have increased for 2020. Here are some that may be important to you and your business. Social Security tax The amount of employees’ earnings that are subject to Social Security tax is capped for 2020 at $137,700 (up from $132,900 Read More »
Many people who launch small businesses start out as sole proprietors. Here are nine tax rules and considerations involved in operating as that entity. 1. You may qualify for the pass-through deduction. To the extent your business generates qualified business income, you are eligible to claim the 20% pass-through deduction, subject to limitations. The deduction Read More »
A significant law was recently passed that adds tax breaks and makes changes to employer-provided retirement plans. If your small business has a current plan for employees or if you’re thinking about adding one, you should familiarize yourself with the new rules. The Setting Every Community Up for Retirement Enhancement Act (SECURE Act) was signed Read More »
On December 20, 2019, the Setting Every Community Up for Retirement Enhancement Act (SECURE Act) became law, as part of the Further Consolidated Appropriations Act, 2020 (H.R. 1865), which was primarily a budget and spending law. The SECURE Act is landmark legislation that affects the rules for creating and maintaining workplace retirement plans for all Read More »
The fourth quarter 2019 Michiana Benchmark Business Index (BBI), compiled by the certified public accounting and consulting firm of Kruggel Lawton CPAs, held steady from the prior quarter. The overall fourth quarter BBI was 54.71 out of a maximum possible score of 100. This was essentially unchanged from the third quarter BBI result of 54.78. Read More »
We’ve all done it: you get ready to write a check in January and you accidentally date it for the previous year. For the first few weeks of every year this usually mindless task actually requires us to focus in order to complete properly. When signing legal documents this year, officials advise that you not Read More »
The government funding legislation passed by the House on Dec. 17 and by the Senate on Dec. 19 includes repeal of Internal Revenue Code Section 512(a)(7), commonly referred to as the “parking tax.” The legislation was signed into law by the President on Dec. 20, 2019. The provision, enacted as part of the 2017 Tax Read More »
Here are some of the key tax-related deadlines affecting businesses and other employers during the first quarter of 2020. Keep in mind that this list isn’t all-inclusive, so there may be additional deadlines that apply to you. Contact us to ensure you’re meeting all applicable deadlines and to learn more about the filing requirements. January Read More »
According to the Society for Human Resource Management, 47% of companies offer a community volunteer program for employees. Chief Executives for Corporate Purpose has found that large companies are even more likely to sponsor volunteer activities: 61% offer paid-release time volunteer programs or a structured corporate volunteer program. If your not-for-profit suffers from a chronic Read More »
With Thanksgiving behind us, the holiday season is in full swing. At this time of year, your business may want to show its gratitude to employees and customers by giving them gifts or hosting holiday parties. It’s a good idea to understand the tax rules associated with these expenses. Are they tax deductible by your Read More »
A month after the new year begins, your business may be required to comply with rules to report amounts paid to independent contractors, vendors and others. You may have to send 1099-MISC forms to those whom you pay nonemployee compensation, as well as file copies with the IRS. This task can be time consuming and Read More »
A hypothetical not-for-profit staffer named Britney had maxed out her personal credit cards. So when her car needed repairs, she reached for her employer’s card. She reasoned that she would come up with the money to pay the bill before her boss ever saw a statement. Britney didn’t come up with the money. But lucky Read More »
Most not-for-profit (NFP) entities are already in the process of adapting their accounting practices to accommodate the FASB Accounting Standards Update (ASU) No. 2018-08: Clarifying the Scope and Accounting Guidance for Contributions Received and Contributions Made. Whether you’ve already started the process, or are still looking into the requirements, your organization still has time to Read More »
One of the most laborious tasks for small businesses is managing payroll. But it’s critical that you not only withhold the right amount of taxes from employees’ paychecks but also that you pay them over to the federal government on time. If you willfully fail to do so, you could personally be hit with the Read More »
The third quarter 2019 Michiana Benchmark Business Index (BBI), compiled by the certified public accounting and consulting firm of Kruggel Lawton CPAs, showed improvement for the second straight quarter after reaching its lowest level ever in the first quarter of 2019. The overall third quarter BBI was 54.78 out of a maximum possible score of Read More »
Many business owners ask: How can I avoid an IRS audit? The good news is that the odds against being audited are in your favor. In fiscal year 2018, the IRS audited approximately 0.6% of individuals. Businesses, large corporations and high-income individuals are more likely to be audited but, overall, audit rates are historically low. Read More »
Many not-for-profit organizations use fundraising methods that cross state boundaries. If your nonprofit is one of them, it may need to register in multiple jurisdictions. But keep in mind that registration requirements vary — sometimes dramatically — from state to state. So be sure to determine your obligations before you invest time and money in Read More »
Here are some of the key tax-related deadlines that apply to businesses and other employers during the final quarter of 2019. Keep in mind that this list isn’t all-inclusive, so there may be additional deadlines that apply to you. Contact us to ensure you’re meeting all applicable deadlines and to learn more about the filing requirements. October 15 Final Read More »
At Kruggel Lawton, we work hard to serve our KLients, not just as your accountants, but as active members of our community. That’s why KL is participating in Youth Service Bureau’s Over the Edge event on October 4, 2019. YSB’s Street Outreach team has highlighted the impact YSB is making in our community. This story Read More »
Do you want to withdraw cash from your closely held corporation at a low tax cost? The easiest way is to distribute cash as a dividend. However, a dividend distribution is not tax efficient. Not only will it be taxable to you to the extent of your corporation’s “earnings and profits,” but the corporation will Read More »
With today’s fast pace in business, there are times when we are presented with opportunities that seem good at face value, but it’s worth taking the time to check in and do your research before making a big decision. This is especially true when you’re presented the opportunity to buy a business. Make sure that Read More »
Kruggel Lawton is pleased to announce an easy, convenient, and secure on-line system for our KLients to make payments on their accounts. We have recently partnered with QuickFee, a service established in 2016 that specializes in online secure payment options for CPA firms. Because of QuickFee’s long-term history and specialization of serving CPA firms, Kruggel Read More »
If you’re a small business owner or you’re involved in a start-up, you may want to set up a tax-favored retirement plan for yourself and any employees. Several types of plans are eligible for tax advantages. 401(k) plan One of the best-known retirement plan options is the 401(k) plan. It provides for contributions made at Read More »
Operating a business as an S corporation may provide many advantages, including limited liability for owners and no double taxation (at least at the federal level). Self-employed people may also be able to lower their exposure to Social Security and Medicare taxes if they structure their businesses as S corps for federal tax purposes. But Read More »
QUESTION: Our break room has a refrigerator stocked with drinks that are available to everyone at the office, including guests. We also usually have cookies and other treats available. Are these snacks taxable benefits that we need to track? That would be a lot of trouble for a small benefit (and it would really undermine Read More »
Have staffers complained because their expense reimbursements are taxed? An accountable plan can address the issue. Here’s how accountable plans work and how they benefit employers and employees. Be reasonable Under an accountable plan, reimbursement payments to employees will be free from federal income and employment taxes and aren’t subject to withholding from workers’ paychecks. Read More »
If you’ve ever fostered a pet, you know the costs can add up: food, toys to keep them entertained, maybe they need grooming or you have to kennel them for a trip, and probably a vet bill or two before your fuzzy little ward finds his forever home. But you foster anyway, because animals that Read More »
The IRS uses Audit Techniques Guides (ATGs) to help IRS examiners get ready for audits. Your business can use the same guides to gain insight into what the IRS is looking for in terms of compliance with tax laws and regulations. Many ATGs target specific industries or businesses, such as construction, aerospace, art galleries, child Read More »
The second quarter 2019 Michiana Benchmark Business Index (BBI), compiled by the certified public accounting and consulting firm of Kruggel Lawton CPAs, recovered slightly after reaching its lowest level ever in the first quarter of this year. The overall second quarter BBI was 53.01 out of a maximum possible score of 100, an increase of Read More »
In the course of operating your business, you probably spend time and money “wining and dining” current or potential customers, vendors and employees. What can you deduct on your tax return for these expenses? The rules changed under the Tax Cuts and Jobs Act (TCJA), but you can still claim some valuable write-offs. No more Read More »
If you read the Internal Revenue Code (and you probably don’t want to!), you may be surprised to find that most business deductions aren’t specifically listed. It doesn’t explicitly state that you can deduct office supplies and certain other expenses. Some expenses are detailed in the tax code, but the general rule is contained in Read More »
Here are some of the key tax-related deadlines that apply to businesses and other employers during the second quarter of 2019. Keep in mind that this list isn’t all-inclusive, so there may be additional deadlines that apply to you. Contact us to ensure you’re meeting all applicable deadlines and to learn more about the filing Read More »
It’s a well-known truism in the corporate world: Organizations that don’t evolve run the risk of becoming obsolete. But instead of anticipating and reacting to market demands like their for-profit counterparts, many nonprofits hold on to old ideas about how their organizations should be run. Here are a few things your nonprofit can learn from Read More »
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