Cutting edge tax and accounting news
Frank Akef & Co. newsletters tackle issues affecting not just our own clients but the general public as well. Informative, detailed, yet easy to understand, our newsletters will guide you and bring you up to date on all the new tax and accounting matters that will affect you and your financial security.
Paycheck Protection Program Flexibility Act of 2020
One of the most important business benefits of the CARES Act, signed March 27, 2020 by the President is the Paycheck Protection Program (PPP) loan administrated by the SBA. Under this program, eligible small businesses could get low interest loans that can be partially or fully forgiven. Unfortunately, there’s been some confusion around certain program points. In an effort to clarify these points, Congress passed the Paycheck Protection Program Flexibility Act (PPPFA), signed on June 5, 2020. This new bill modifies the PPP provisions below.
AB5 Update - Coronavirus Unemployment Uncovers Gig Employers
In the present “Gig Economy”, businesses often misclassify workers as independent contractors in order to avoid paying payroll tax, unemployment and disability insurance, worker’s compensation and Social Security otherwise due for employees. California Assembly Bill Number 5 (AB5) reverses this practice by reclassifying certain independent contractors as employees.
Pandemic Relief Notice
Federal & California State Tax Return & Payment Extensions: The IRS has delayed the tax payment deadline for Federal returns by 90 days without the need to report the delay to the government for all taxpayers affected by the Coronavirus disaster up to $1M for individuals (including self-employed), married people filing a joint return, and all entities other than C-Corporations (Trusts and Estates) and up to $10M for each C-Corporation. Interest, penalties and additions to tax will accrue on taxes in excess of the amounts that are due but not paid by April 15, 2020 if people/organizations owe more than the amounts above. Although this may change, federal tax returns still need to be filed April 15, 2020. Based on this, FAC will file regular extension Form 4868 with the IRS for all clients who are not already on extension.
Paid Sick Leave Update - It's not easy being an employer series
Does your company have a written policy regarding paid sick leave? If not, then do we have some good news for you, it has already been done for you. The State of California instituted a law mandating mandatory sick leave for all employees performing services in our great state, regardless of whether your employees are part time or full time!
1099 Contractor Update - It's not easy being an employer series
There has always been an issue in how businesses classify their workers as employees or contractors, and it comes up frequently. When a business classifies a worker as an employee, the employer has the obligation to withhold employment taxes from earnings and match the FICA and Medicare contributions. Additionally, there are issues such as employer sponsored health insurance, workers compensation insurance, pension plans, the right of collective bargaining, and vacation, sick, and holiday benefits. As opposed to employees, businesses may have workers who are independent contractors, for whom those requirements are not needed. This has caused confusion regarding the proper way to classify workers.
Minimum Wage Update - It's not easy being an employer series
One of the issues an employer needs to stay aware of is the increases to the minimum wage. The Federal government occasionally increases the wage, which since 2009 has remained at $7.25 per hour, but living in California, where the cost of living is so high; our California minimum wage is even higher. Also, cities and municipalities have recently been getting involved, which further complicated matters. For this reason, here is the quick look at the current and soon-to-be minimum wage.
Do you qualify for Business Tax Credits?
Congress, believe it or not, wants to promote the expansion of business in the United States. To this end, we have tax changes on an annual basis, which your tax professionals at Frank Akef & Co always keep up upon. A constantly changing issue is that of business tax credits, which are used to influence businesses to invest in projects that the government deems worthy. We are always interested in getting the credits for our clients so we can lower your overall tax burden. We thought we would share information on some of the more popular business tax credits.