Tax Season Update (3/17/2021):
Change in Individual Tax Filing Deadline, Nontaxable Unemployment Income, and Small Business Grant Deadlines
Change in Tax Filing Deadline
The IRS is expected to change the individual filing date to the middle of May. We anticipate this will result in a 17-May filing deadline for individuals filing 1040s. We are awaiting additional guidance as to whether this change will impact filing deadlines for Corporations and/or nonprofits. We will continue to update you as we learn more.
Up to $10,200 in Unemployment Income Not Taxable
Up to $10,200 in unemployment income received will not be taxable to the taxpayer
Requires modified adjusted gross income to be less than $150K
We are awaiting guidance from the IRS on how to recover the taxes paid on the unemployment income in the returns that have already been filed. We will contact clients directly if their returns and/or liabilities will be impacted.
First and Second Draw of the PPP
Deadline is 3/31/2021
We are closely monitoring congressional actions in anticipation of an extension
If you are interested or have questions about eligibility, see the previously provided section below
If you have not yet provided your documents, do so as soon as possible
Deadline for a grant from the Relief Fund for Black Owned Business it TONIGHT!!
Funded through the Cummins’ Care Initiative in Partnership with the Indy Black Chamber of Commerce
Grants for up to $15K
Must be a black owned business with 1-10 employees and under a $1M in gross revenue
Apply here: https://lisc.tfaforms.net/307
Deadline to apply for the Small Business Facade and Property Improvement Program is April 2nd
The Small Business Facade and Property Improvement Program is a component of the Inclusive Economic Opportunity Districts Program that provides matching grants to property and business owners willing to renovate the street-front exteriors of their structures.
Apply here: https://www.lisc.org/indianapolis/what-we-do/opportunity/facade-and-property-improvement-program/
Elevate Grant Deadline May 18, 2021
The Federal Home Loan Bank of Indianapolis (FHLBank Indianapolis) announced the opening of the 2021 Elevate Small Business Grant Program with $500,000 available. You can find program information, training tools, marketing materials, and the application below.
Apply here: https://www.fhlbi.com/products-services/community-investment-and-housing/community-and-economic-development/elevate-(small-business-grant)?fbclid=IwAR3HeMMeHdDOZq9IRjNmed8ZPlHZBjomI5eyKJjN8VxPRcZ6uIyqyzS0mIA
Updates to Previously Shared Information
PPP2: Requirements for 1st Draw and 2nd Draw Applicants
The Consolidated Appropriation Act was signed into law on December 27. The Act includes provisions for a second round of PPP loans, 2021 stimulus checks, extended unemployment benefits, and addresses the taxation of forgiven PPP loans (first draw).
The Act included provisions for a 2nd round of Paycheck Protection Program loans. It includes requirements for both new and return PPP loan applicants. While we expect to receive specific guidelines from the SBA this week, here is what we know from our review of the Act:
Paycheck Protection Program Parameters
Applicants may be eligible for loan amounts up to 2.5 times the average monthly payroll (3.5 times for hotels and restaurants) up to $2 Million.
New: Max loan amounts for tax payers filing on a schedule C can be calculated based on gross receipts!
Funds can be used to cover payroll, rent, covered mortgage interest, utilities, certain facility modifications, PPE, accounting needs, and software/cloud computed services.
If at least 60% of the loan amount is used to cover payroll and employee levels are maintained, the eligible loan amount may be forgiven.
Applications can be processed through banks or financial technology firms (i.e. Intuit/PayPal).
ATS can also submit applications directly under the American Institute of CPAs partnership with Biz2Credit.
Paycheck Protection Program Eligibility
First time borrowers:
Businesses with 500 or fewer employees
Sole proprietors and independent contractors
Nonprofit organizations (including business associations)
Second time borrowers:
Same as above, but with 300 or fewer employees
Ability to demonstrate the full use of the initial PPP loan
Ability to demonstrate a 25% gross revenue decline in any 2020 quarter when compared to the same quarter in 2019
If you have a relationship with your bank and would like to work through them to apply for PPP2, pull documents together to support eligibility. If you do not have a relationship with your bank and/or you would like ATS to assist with assessing eligibility and the application process, please contact us at email@example.com. We have already worked through several applications.
How to Get Your Taxes Filed?
If you have not already submitted your information to an ATS Tax Specialist, please use the 2020 Individual Income Tax Checklist as a reference as you gather required documentation. Please note, including all required documents in your initial submission will expedite the preparation process.
You may submit tax documentation to ATS in any of the following ways:
1) If you already have an account on ATS’s secured site, use the ATS secure site link, (https://mytaxdocs.com/default.aspx?o=12817), with your existing user name and password to access the 2020 folder and upload your documents. You may select the “Forgot username or password” link if you need to reset your password. Please note, you will need your user name (which is not your email address) to recover your password. If you do not know your user name, please email firstname.lastname@example.org.
2) Email Danita Owens at email@example.com to request a link to the ATS secured site, use the link to create an account, and upload your tax documents
3) Mail or Deliver the documents to 5023 E 56th St, Suite 230, Indianapolis IN 46226
4) Fax your documents to 317-218-7251 (always available)
5) Scan your documents, convert them to PDF and email them to firstname.lastname@example.org.
After we receive your documents, we will email an Engagement Letter for you to sign and return.
Please note, these laws and related policies will continue to evolve in the coming weeks and are subject to change/clarification. Therefore, information contained within this communication is provided for informational purposes only and is not intended to substitute for obtaining accounting, tax, or financial advice from a professional accountant. Presentation of the information via the internet is not intended to create, and receipt does not constitute, an accountant-client relationship. ATS CPA & Consulting Services, Inc. specifically disclaims any liability for any direct, indirect, incidental, consequential or special damages arising out of or in any way connected with access to or use of this information.