Guidance and Information

Employee Retention Credit

ERC Resources:

AICPA Information:

Other Tax Notes:

Nov. 16, 2023

Tax Cuts and Jobs Act sunset

  • 26 months to go (or sooner depending on political climate)!

Manage lifetime exemption gifts as we approach TCJA sunset.

  • Don’t assume that splitting gifting between spouses is optimal.
  • Goal is to preserve the most lifetime exemption as a family with the TCJA sunset.
  • Bracket management
  • Accelerate income and recognition events to avoid tax rate increases.
  • Defer expenses to capture a greater benefit if rates increase.
  • Itemized deduction timing
  • Consider timing of property tax payments and impact if State and Local Tax (SALT) cap is repealed.

SECURE 2.0 technical corrections

  • Congress has identified corrections that are needed
  • Sec 102 – Small employer pension plan start up credit
  • Not clear that intent was the to add $1,000 per employee in addition to the previous $5,000 startup credit.
  • Sec 107 – There are 2 triggering ages for the Required Beginning Date for people born in 1959.
  • Sec 601 – SIMPLE and SEP Roth IRAs
  • Currently it could be read to limit the SEP/SIMPLE Roth contribution to the Roth IRA limit.
  • The AICPA Tax and PFP Executive committees sent a joint comment letter in support of these and identifying several additional areas of correction that were needed.

ERC News

April 18, 2024

The Tax Adviser | Despite an IRS moratorium on processing new employee retention credit (ERC) claims, the IRS Commissioner told the U.S. Senate Finance Committee that the IRS averages 20,000 new applications weekly. Proposed legislation on ERC enforcement, statute of limitation and increased penalties has slowed. The IRS has not resumed processing new claims. Read more

 

March 22, 2024

The Journal of Accountancy | The IRS has identified about $1 billion in potential savings from erroneous employee retention credit (ERC) claims, with over half of that money coming from enforcement efforts and the rest from the ERC voluntary disclosure program (VDP) and claim withdrawal process, officials said Friday. Read more

 

February 20, 2024

The Journal of Accountancy | The employee retention credit (ERC), as authorized under pandemic-era legislation to assist businesses with the costs of retaining employees, has been claimed by many employers for applicable quarters in 2020 and 2021. This article discusses the requirement to amend income tax returns in connection with an ERC claim and to review the professional responsibility to which all CPAs must adhere in amending these income tax returns. Read more

 

February 13, 2024

IRS | The Internal Revenue Service today highlighted special warning signs that an Employee Retention Credit (ERC) claim may be questionable to help small businesses that may need to resolve incorrect claims. Read more

 

January 29, 2024

AICPA Tax Adviser | The IRS Criminal investigation (CI) will host education sessions for tax professionals in February to ensure they understand eligibility requirements for employee retention credit (ERC) claims and have the latest ERC claims information. Meanwhile, the IRS said it has not determined when it will end its moratorium on processing new claims, which began four months ago. Read more

 

December 21, 2023

IRS Press Release | The IRS launched a new Voluntary Disclosure Program to help businesses who want to pay back the money they received after filing ERC claims in error. Read more

 

December 6, 2023

The Journal of Accountancy | The IRS is advising over 20,000 taxpayers that their claims for the employee retention credit are being disallowed because entities either did not exist or did not have paid employees during the period of eligibility for the pandemic-era credit. Read more

 

 

 

RESOURCES

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