Author: Kellie Harris Page 1 of 4

The New Charitable Deduction for Non-itemizers

Many charitable organizations are now experiencing a decline in giving as the U.S. finds itself grappling with the COVID health crisis.  In response, Congress included a provision in the Coronavirus Aid, Relief, and Economic Security (CARES) Act, P.L. 116-136, intended to provide some relief for charitable organizations. Section 2204 of the CARES Act permits eligible individuals who do not itemize deductions to deduct $300 of qualified charitable contributions as an “above-the-line” deduction, i.e., as an adjustment in determining adjusted gross income (AGI), for tax years beginning in 2020.

QUALIFYING FOR THE DEDUCTION

For tax years beginning in 2020, eligible individuals may deduct up to $300 in qualified charitable contributions made to qualified charitable organizations.… Read More

IRS Addresses Temporary Deviation from Handwritten Signature Requirement for Limited List of Tax Forms

On August 27, 2020, the Department of Treasury and Internal Revenue Service issued a memorandum addressing Temporary Deviation from Handwritten Signature Requirement for Limited List of Tax Forms.   Here is the memo content:

As part of our response to the COVID-19 situation, we have taken steps to protect employees, taxpayers and their representatives by minimizing the need for in-person contact. Taxpayer representatives have expressed concerns with securing handwritten signatures during these times for forms that are required to be filed or maintained on paper. To alleviate these concerns while promoting timely filing, we are implementing a temporary deviation with this memorandum that allows taxpayers and representatives to use electronic or digital signatures* when signing the following forms that currently require a handwritten signature:

• Form 3115, Application for Change in Accounting Method;

• Form 8832, Entity Classification Election;

• Form 8802, Application for U.S.… Read More

13.9 million Americans to receive IRS tax refund interest; taxable payments to average $18

This week the Treasury Department and the Internal Revenue Service will send interest payments to about 13.9 million individual taxpayers who timely filed their 2019 federal income tax returns and are receiving refunds.

The interest payments, averaging about $18, will be made to individual taxpayers who filed a 2019 return by this year’s July 15 deadline and either received a refund in the past three months or will receive a refund. Most interest payments will be issued separately from tax refunds.

In most cases, taxpayers who received their refund by direct deposit will have their interest payment direct deposited in the same account.… Read More

Why hasn’t the IRS cashed my check yet? Why am I receiving a notice?

Several clients have contacted us to let us know they have received notices from the IRS recently. In many cases, the notices are telling the taxpayer that their 2019 return was filed but no payment received. Some clients who filed a paper tax return are being notified that there is a credit from payments made but no return received. Other clients have not received a notice but are concerned that their check has not been cashed by IRS yet. Questions we’ve been asked include: should they stop payment of original check and mail another? Should they pay the penalty and interest?… Read More

RMD Rollover Deadline

It seems that summer is flying by, even in uncertain times. You can count on only a few things in life and taxes is one of them. We are fast approaching the deadline to rollover any RMDs that were taken in 2020. Below is a brief explanation of what a RMD is and how the CARES Act plays into your RMD for 2020. If you are in a position where you currently do not need the money from your IRA or 401(k), the RMD Waiver, under the CARES Act, can give you an advantage in tax planning for 2020.

IRA and 401(k) plan owners are required to take a certain amount of money out of their accounts each year beginning in the year they turn 72 (or you are taking them from age 70 ½ before the new rules).… Read More

What do I do? I shredded my stimulus debit card or it has the wrong name

Don’t throw away that debit card that just arrived in the mail — it could be your coronavirus stimulus payment.

In order to expedite the issuance of stimulus payments, the Treasury Department decided to send out to 4 million people debit cards instead of checks.  The problem is that most people were looking for a check and thought the debit card was junk mail.  The cards arrive in a plain envelope from “Money Network Cardholder Services,” according to the IRS, with the name of the issuing bank, MetaBank, N.A., on the back.  The card doesn’t show it is from the federal government but the envelope does state that it is being sent on behalf of the Treasury Department.

If you do throw the card away, you can get a replacement by calling customer service at 1-800-240-8100, according to EIPCard.com, which provides information on how to use the cards. While the cardholder agreement says it costs $0 to replace the card the first time, there is a $17 charge for priority shipping of the new card.

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When Can I Expect My Economic Stimulus Paper Check?

For taxpayers who will be receiving their stimulus checks via paper check because no direct deposit information was available, below shows dates for when those payments are scheduled to be mailed by the IRS. The dates are based on the adjusted gross income (AGI) shown on the taxpayer’s 2019 tax return, if filed and processed. Otherwise, it is based on the taxpayer’s AGI shown on the 2018 tax return.

If AGI is:                        Scheduled Mailing Date
$10,000 or less              April 24, 2020
$20,000 or less              May 1, 2020
$30,000 or less              May 8, 2020
$40,000 or less              May 15, 2020
$50,000 or less              May 22, 2020
$60,000 or less              May 29, 2020
$70,000 or less              June 5, 2020
$80,000 or less              June 12, 2020
$90,000 or less              June 19, 2020
$100,000 or less            June 26, 2020
$110,000 or less             July 3, 2020
$120,000 or less            July 10, 2020
$130,000 or less            July 17, 2020
$140,000 or less            July 24, 2020
$150,000 or less            July 31, 2020
$160,000 or less            August 7, 2020
$170,000 or less            August 14, 2020
$180,000 or less            August 21, 2020
$190,000 or less            August 28, 2020
$200,000 or less           September 4, 2020
All others                         September 11, 2020

If you have questions or concerns about the stimulus, e-mail us at cares@brinkersimpson.comRead More

Webinar Recording available for May 12th PPP, Main Street Lending Program, & Employee Retention Credit Presentation & Discussion

Brinker Simpson & Company, LLC hosted a webinar Tuesday May 12th, 2020 to provide an overview and update of various financial relief resources for businesses impacted by COVID19 virus mitigation measures.

Today we covered updates on the Main Street Lending Program, the PPP and an overview and update on the Employee Retention Credit.

The webinar addresses many commonly asked questions about the PPP and the related forgiveness.

There are still major areas of uncertainty, including critical forgiveness calculation information.  The CARES Act required final guidance by April 26, 2020.  At this time, the final guidelines have not been released.  Various sources have indicated this guidance will be released this Friday May 15, 2020.… Read More

IRS Adds FAQs On COVID-19 Retirement Plan Distribution and Loan Rule Changes

IRS website: “Coronavirus-related relief for retirement plans and IRAs questions and answers” (revised May 4, 2020)

On its website, the IRS has released a series of frequently asked questions (FAQs) regarding changes made by the Coronavirus Aid, Relief, and Economic Security (CARES) Act to retirement plan distribution and loan rules.

When do I have to pay taxes on COVID-19-related distributions?

The distributions generally are included in income ratably over a three-year period, starting with the year in which you receive your distribution. For example, if you receive a $9,000 COVID-19-related distribution in 2020, you would report $3,000 in income on your federal income tax return for each of 2020, 2021, and 2022.Read More

TAX-RELATED DEADLINES EXTENDED FOR EMPLOYEE BENEFIT PLANS AND THEIR PARTICIPANTS

Extension of Certain Timeframes for Employee Benefit Plans, Participants, and Beneficiaries Affected by the COVID-19 Outbreak

The IRS, together with the Employee Benefits Security Administration (EBSA), has issued guidance that extends tax-related deadlines for certain employee benefit plans, and their participants, due to the COVID-19 National Emergency.

Background. On March 13, 2020, the President declared a national emergency due to the novel coronavirus outbreak (COVID-19 National Emergency). This Presidentially declared emergency applies to every taxpayer in a U.S. state, territory or possession.

In the case of a pension or other employee benefit plan (collectively “Plans”), or any participant, beneficiary, or other person with respect to such plan (collectively “Participants”), affected by a Presidentially declared emergency, the IRS may specify a period of up to one year that may be disregarded (“Disregarded Period”) when determining the date by which Plans are required to completed any tax-related action under the Code.Read More

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