Anthony Sykes & Company

     One of the key features of the Paycheck Protection Program ( PPP ) was that these business loans could be partially or entirely forgiven. This would be based on whether the funds were spent on wages, keeping employment levels the same as they were before the COVID-19 pandemic, and other factors. Of course, proof would have to be provided that these requirements have been met and an application needs to be submitted. All of that has now been put on pause.      Those Forgiveness Applications will not be accepted until August 10 at the earliest. Part of the reason is that the Treasury Department has not yet issued the final guidance on those applications. That may be because the US Senate is looking into another round of economic stimulus, which will certainly change the procedures related to forgiving PPP loans. What will happen remains to be seen, so for now we will all need to exercise some patience.

     Taxpayers need to protect themselves at all times, especially when communicating online. The Internet allows anyone to share information with everyone. This is the basic principle that scammers exploit when using Social Media scams. Information becomes their tool of choice when trying to steal personal information.        This is especially true during a crisis like COVID-19 . The Internal Revenue Service ( IRS ) states that the current health crisis has been used extensively by criminals in attempts to steal information from Taxpayers. Often it starts with the victim getting an email or text that has a link to something they are interested in. By clicking on that link, you will be exposing yourself to all sorts of malicious code. Some will seek out your passwords, user names, or banking information. So make sure you know what you are clicking on and who the source is. Make sure you look closely at the message, there may be clear indications tha...

     Every year the Internal Revenue Service ( IRS ) announces a “Dirty Dozen” list of scams and crimes that Taxpayers should be aware of. These are most commonly seen during Tax Season, but can be used at any time. This year, with the COVID-19 pandemic, the focus is on how criminals are using everything related to the Coronavirus to prey on the fear and uncertainty around us.      The goal of these tax scams is to steal your personal information and money. Criminals feel that everyone is a potential target, so please do not engage with these individuals. We all must be on guard against these frauds, and try to watch out for each other. Our next few blog posts will highlight some of the more recent trends in this area of tax crime.

     If you find yourself in a situation where you owe taxes to the Internal Revenue Service ( IRS ), there are a variety of payment options available to you. First, you should understand that a tax responsibility for 2019 and an estimated tax payment for 2020 are 2 separate payments, even if they are due at the same time. Do not combine them.      Like most businesses today, the IRS would prefer “no contact” payments through credit or debit cards, or even using bank accounts. These methods will update your account in the fastest way possible. Checks are still accepted, but they might take some time to process. For those who cannot pay their tax responsibility in full, you are encouraged to pay what you can at the time of filing. This will prevent a “Non-Filing” penalty being added to your debt.      There are a variety of payment options that are available to most Taxpayers. We have written about some in previous blog posts . When co...

     A variety of circumstances can come together that make Tax Season a very difficult and challenging time for many individuals and business owners. With that understood, there is one action that must be taken. File your Tax Return on time! Taking this seemingly simple step will save much anxiety and some money.      For those who know they will owe taxes, but are unable to pay the full amount, filing your Tax Return on-time is a very important step. Not doing so may add special penalties and interest to your debt. If you pay what you can at the time of filing, the Internal Revenue Service ( IRS ) will take this into consideration. Remember that a tax filing extension is not an extension to pay tax responsibilities. For help to make sure that you are in the best position when dealing with the IRS , please consult your Qualified Tax Professional . 

     The Franchise Tax Board ( FTB ) is reminding Taxpayers that the time to pay is now upon us. Any individual Income Tax payment must be made by Wednesday July 15 . There has also been adjustment for those who make Quarterly tax payments. Two Quarterly estimates must be made as one , and that is also due on July 15. The individual and Quarterly tax payments must not be combined.      Those who do not owe or who are not required to file a Tax Return may benefit from filing. It is not too late to file and claim credits you may qualify for. It’s always best to seek out the help of a Qualified Tax Professional in this matter.

     There is only a 3 year window to claim a Tax Refund. With the unique circumstances of this year, that window of opportunity has been extended to July 15 . The Internal Revenue Service ( IRS ) estimates that unclaimed refunds for 2016 total about $1.5 Billion. These refunds can be claimed by about 1.4 Million Taxpayers.      These refunds have gone unclaimed because the Taxpayers have failed to file their 2016 Tax Returns. They are urged to do so as soon as possible. There is no penalty to file late if you receive a refund. This year, it might be the key to getting your Economic Impact Payment ( EIP ). If you have not filed for a few years, you may be in this situation. It’s not too late to talk to a Qualified Tax Professional , and find out what needs to be done.

     The Internal Revenue Service ( IRS ) is reminding Taxpayers who took part in tax payment relief provided due to the COVID-19 pandemic that those owed tax payments, which stopped on March 25, must now resume. The IRS is starting to reopen their offices, as many businesses are reopening, and it is necessary to restart these payments to avoid penalties and interest. There are a few details that Taxpayers must understand when going forward.      Installment Agreements . For those who had paused payments, understand that while interest continued to accrue on these amounts, but the IRS never defaulted your agreement. Contact your financial institution to make sure they restart the direct debit payments if you had them stopped.       Offer in Compromise . If the offer in question is still pending with the IRS , the Taxpayer should simply restart making their normal payments by July 15. The offer will be amended to involve the skippe...

     For those who provide on-demand work or services, it can be difficult at times to get all your paperwork together to file your taxes. Keep in mind that no matter what your activity is in this field, all income is taxable. The biggest concern is that you are classified correctly as either an employee, or an independent contractor. Lawsuits have been filed over this issue because states have different standards they apply to make this determination.      An employer will withhold some income from their Employees to pay their share of Social Security, Medicare, and Medicaid taxes. Independent Contractors must estimate those payments every Quarter. They must keep good records to make sure they are current with their tax responsibilities. If you were providing ride-sharing or home rentals or any other access economy activity in 2019, make sure to report it all on your Tax Return by July 15 .

     With so many staying home due to the COVID-19 pandemic, there is a steep rise in demand for food delivery services. Different companies are available in most major markets, but all of them are seeing a boom in business. For some restaurants, it is the only way they can try to stay afloat. When any industry sees major growth, state tax agencies are always ready to take a close look at their accounting practices.      One focus of many agencies will be taxes related to marketing, delivery, and processing fees. Are they being collected and paid? Since almost every state and most cities have different laws, this is a concern that must be addressed. This is similar to the situation that Online Marketplaces found themselves in 5 years ago when the US Supreme Court ruled that they must collect and pay Sales Tax wherever their items are bought, even if they do not have a physical presence in that state. Food delivery services may begin to have each transa...