Michael Gray, CPA's Tax and Business Insight
August 7, 2024
© 2024 by Michael C. Gray
ISSN 1539-395X
A monthly report to help you prepare for your financial future, keep more of what you earn by minimizing your taxes, and build an extraordinary business!
Route to _______ _______ _______ _______ _______
(If you find this information valuable, please pass it on to a friend!)
Table of Contents
- School days, school days...
- Family celebrations
- Michael Gray's calendar.
- October 15 will soon be here!
- Need help with getting your extended tax returns, amended returns, and elections done?
- Third quarter estimated tax payment due September 16, 2024.
- Remember to check if a Beneficial Ownership Information Report is required for your business.
- Even single-employee businesses must register with CalSavers.
- U.S. Senate fails to pass Tax Relief for American Families and Workers Act.
- IRS is processing older Employee Retention Credit claims.
- U.S. Supreme Court OKs "repatriation tax".
- IRS issues Final Regulations disallowing certain Charitable Easement Deductions.
- Correction for July 2024 Tax and Business Insight newsletter.
- Do you sell products, services or software to CPAs?
- Attention CPAs-would you like help with marketing your services?
- Attention CPAs-do you need support for tax issues?
- Attention Accountants! Speed up processing your business closings!
- Please share your good experiences with Michael Gray, CPA.
- Financial Insider Weekly past episodes.
- Visit our new book review: Don't Say That
- Follow me on social media!
- Check out my blogs.
- Subscribe/Remove from Michael Gray, CPA's Tax & Business Insight
Dawn & John Siemer on their Big Island, Hawaii vacation School days, school days...
It's hard to believe, but summer vacation is almost over and most children will be back in school by the end of August! Please drive carefully with those kamikaze kids out there!
Family celebrations.
Janet and I are celebrating our wedding anniversary this month (53 years)! Our other August family celebrations include my granddaughter, Minerva Siemer's birthday and Janet's sister, Gail Johnston, is celebrating a birthday. Happy birthdays!
Michael Gray's calendar.
Michael Gray won't be available from August 9 to August 19, 2024.
October 15 will soon be here!
The extended due date for 2023 individual income tax returns is October 15, 2024. If you've been putting off getting your tax returns finished, now is the time to get in motion.
Need help with getting your extended tax returns, amended returns, and elections done?
To make an appointment, contact Thi Nguyen, CPA at thi@atl-cpa.com.
Third quarter estimated tax payment due September 16, 2024.
Remember the third quarterly federal estimated tax payment is due September 16, 2024. California doesn't have a third quarter estimated tax payment.
Remember to check if a Beneficial Ownership Information Report is required for your business.
Most businesses that aren't publicly traded or "large operating companies" and are registered with a Secretary of State, including single-person LLCs, are required to file a Beneficial Ownership Information Report no later than December 31, 2024.
Here is a FinCEN link for filing the report. https://boiefiling.fincen.gov/
More details are available at this link. https://boiefiling.fincen.gov/help See your business attorney or tax advisor.
Note that an updated FAQ says that relief from filing for dissolved entities only applies to entities that completely completed the process of formally and irrevocably dissolving before January 1, 2024. Businesses that are administratively dissolved or suspended generally do not cease to exist as a legal entity unless the dissolution or suspension becomes permanent.
An entity created after December 31, 2023 and dissolved before January 1, 2025 must still file the report.
(Spidell Flash Email, July 8, 2024, "FinCEN addresses beneficial reporting for dissolved entities.")
Even single-employee businesses must register with CalSavers.
By the end of 2025, all businesses that do not offer a qualified retirement program to their employees must register with CalSavers, even if the business only has one California employee who is at least 18 years old. The mandate doesn't apply if the only employees are the owner and the owner's spouse.
Businesses with five or more employees should already have registered.
Employees may elect to opt out of participating in CalSavers.
The employer may adopt a qualified plan or offer participation in the CalSavers plan to employees.
Remember, there is a federal tax credit for starting up a new qualified retirement plan.
For more details about CalSavers, visit www.CalSavers.com.
(Spidell's California Taxletter, August 2024, p. 5, "CalSavers: More businesses must register by the end of 2025".)
U.S. Senate fails to pass Tax Relief for American Families and Workers Act.
On August 1, 2024, the U.S. Senate failed to pass the American Families and Workers Act of 2024. The vote was 48 to 44 in favor, but 60 votes in favor are required to pass. The bill was passed by the U.S. House of Representatives during January 2024 with a vote of 357 to 70.
Provisions of the bill that weren't enacted included:
- Increasing the Child Tax Credit
- Retroactively reinstating the current expense deduction for domestic qualified research expenses, 100% bonus depreciation, and a larger business interest deduction
- Increased Employee Retention Credit (ERC) penalties and a retroactive January 31, 2024 cutoff date for new ERC claims.
- Additional disaster relief for those impacted by federally-declared disasters occurring after 2019.
(Spidell's Flash E-mail, August 1, 2024, "Senate fails to pass Tax Relief for American Families and Workers Act.")
IRS is processing older Employee Retention Credit claims.
The IRS is processing Employee Retention Credit claims that were submitted before September 15, 2023. 10% - 20% of the claims have been identified as high-risk and will be denied. About 60% - 70% are identified as unacceptable risks of error, requiring more analysis by the IRS.
The moratorium for claims filed after September 14, 2023 remains in place. (Claims may be filed, the IRS just won't process them.)
(IR-2024-169, June 20, 2024.)
U.S. Supreme Court OKs "repatriation tax".
On June 20, 2024, the U.S. Supreme Court ruled the one-time mandatory repatriation tax enacted as part of the Tax Cuts and Jobs Act of 2017 is Constitutional. The tax was imposed on U.S. taxpayers who owned 10% or more shares of a controlled foreign corporation. The rates are 15.5% for cash and other liquid assets and 8% for nonliquid assets.
The purpose of the tax was to reach undistributed earnings of foreign corporations that were otherwise sheltered from U.S. tax.
The tax is controversial because it applied to undistributed corporate income.
The Supreme Court's approval of the tax might open the door to a future tax on wealth, when no sale is involved. An opinion by Justice Kavenaugh leaves that question unresolved.
(Moore v. U.S., U.S. Supreme Court June 21, 2024.)
IRS issues Final Regulations disallowing certain Charitable Easement Deductions.
The IRS has issued final regulations for a statutory disallowance rule in the SECURE 2.0 Act of 2022, disallowing a deduction for a qualified conservation contribution made by a partnership or an S corporation after December 29, 2020, if the amount of the contribution exceeds 2.5 times the sum of each partner's or shareholder's relevant basis.
(T.D. 9999.)
Correction for July 2024 Tax and Business Insight newsletter.
On page 8 of the July newsletter item "California budget legislation includes some tax provisions", the italicized line should read "The limitation on business credits does not include the Passthrough Entity Elective Tax Credit."
An exclusion to the limitation for the passthrough entity tax credit was added to Revenue and Taxation Code Section 17039.4 by SB 167 (Ch. 24-34.)
(Spidell's California Taxletter®, August 2024, p. 18, "Correction".)
Do you sell products, services or software to CPAs?
Maybe I can help with writing promotional material and marketing ideas. Call me, Michael Gray, at 408-918-3161 or email mgray@taxtrimmers.com.
Attention CPAs-would you like help with marketing your services?
Maybe I can help with writing promotional material and marketing ideas, including encouraging referrals from your current clients. Call me, Michael Gray, at 408-918-3161 or email mgray@profitadvisors.com.
Attention CPAs-do you need support for tax issues?
Michael Gray, CPA can help you with research and guidance on complex tax planning and tax return reporting issues. mgray@taxtrimmers.com.
Attention Accountants! Speed up processing your 2019 business closings!
Do you still have 2019 business income tax returns on extension that need to be done? Check out this trial balance software, EZ Trial Balance, that's super-easy to set up and use. There is a desktop version and an online version. The online version includes consolidations and ratio analysis for analytical review. http://www.eztrialbalance.com
Please share your good experiences with Michael Gray, CPA.
As you know, more and more people are going to the internet to find information about service providers. We hope you will share some good words about experiences that you have had with our firm. One of the sites where you can share your experiences is yelp.com.
We use Angie's List to assess whether we're doing a good job keeping valued customers like you happy. Please visit AngiesList.com/Review/4258970 in order to grade our quality of work and customer service.
Financial Insider Weekly past episodes
After eight years of production, I have discontinued producing new interviews for Financial Insider Weekly. Doing the show has been a rewarding experience and I consider back episodes to be my legacy of financial literacy education to our community. Back episodes available at https://www.youtube.com/user/financialinsiderweek.
Michael Gray regrets he can no longer personally answer email questions. He will answer selected questions in this newsletter.
For your questions about dependent exemptions, see IRS Publication 501 at www.irs.gov.
Visit our new article!
- Don't Say That Book Review at www.profitadvisors.com/saythat.shtml
Follow me on Social Media!
If you enjoy X/Twitter, please follow me at www.twitter.com/michaelgraycpa.
I'm also on Facebook, and LinkedIn.
you can also follow me on other social media sites, Facebook and LinkedIn.
Check out my blog.
I have also started a blog at www.michaelgraycpa.com. Check it out!
Home Newsletter Archive Introducing Michael Gray, CPA Articles Tax FAQ Need Help? Other Links
Michael Gray, CPA2482 Wooding Ct.San Jose, CA 95128(408) 918-3162FAX: (408) 938-0610email: mgray@taxtrimmers.comHours: 8am - 5pm PDT Monday - FridayFind us on Facebook
Follow me on Twitter
Connect on LinkedIn
Our Blog
