The House of Representatives and the Senate both passed the Consolidated Appropriations Act of 2021 on December 21, 2020, and the President is expected to sign it into law. While the main purpose of the Act is funding the federal government through the end of the government’s current fiscal year, it includes many tax-related provisions. In addition to the items discussed separately in othe...
The 2021 federal estate and gift tax exclusion is $11,700,000, up from $11,580,000 in 2020. The 2021 New York estate tax exclusion is $5,930,000, up from $5,850,000 in 2020. (There is no gift tax in New York State.)
Effective for the 2020 tax year, taxpayers are required to report nonemployee compensation on Form 1099-NEC, Nonemployee Compensation, instead of on Form 1099-MISC, Miscellaneous Income. We will be discussing the new form as part of our upcoming Individual Tax Year-End Workshops.
As discussed in our earlier post on September 17, 2020, New York State has decoupled from certain amendments made to the federal Internal Revenue Code. For taxable years beginning before January 1, 2022, any amendments made to the federal Internal Revenue Code after March 1, 2020 do not apply to the New York personal income tax. New York State recently introduced a new form, Form IT-558, New...
The IRS has announced that it is deferring the effective date of the lower threshold for the requirement for businesses to electronically file Forms W-2 or Forms 1099. For the 2020 tax year, both thresholds will remain 250, which is the same as in prior years. The reduction of the threshold to 100 for the 2020 tax year that was set forth in the Taxpayer First Act of 2019, enacted on July 1, 20...
As discussed in our earlier post on October 1, 2020, certain taxpayers who were directly affected by the pandemic are permitted to withdraw up to $100,000 from retirement accounts without penalty. The IRS recently introduced a new form, Form 8915-E, Qualified 2020 Disaster Retirement Plan Distributions and Repayments, which taxpayers will be required to use to report these distributions on their...
This requirement has been postponed. See our November 19, 2020 post for details. Effective for the 2020 tax year, businesses that file more than 100 Forms W-2 or Forms 1099 must file such returns electronically. As a result, practitioners with clients who will be required to electronically file these forms for the 2020 tax year in January of 2021 must register to be able to electronically fi...
Update: See our January 26, 2021 post for an update regarding Form 3808S. On October 8, 2020, the Treasury Department and the Small Business Administration announced a simplified forgiveness application form for Paycheck Protection Program (“PPP”) loans of $50,000 or less. Under the new rules, borrowers with such loans are exempt from reductions in loan forgiveness amounts based on reduction...
As discussed in our earlier post on March 31, 2020, the Coronavirus Aid, Relief and Economic Security (CARES) Act includes provisions that waive the penalty on certain early withdrawals from retirement accounts, allow the option for such withdrawals to be returned to a retirement account, and provides for a special three-year recognition of income from such distributions for some taxpayers. Ho...
As part of the budget legislation that was effective on April 1, 2020, New York State has decoupled from certain amendments made to the federal Internal Revenue Code. For taxable years beginning before January 1, 2022, any amendments made to the federal Internal Revenue Code after March 1, 2020 do not apply to the New York personal income tax. As a result, this new rule generally affects the...
