January 11, 2021
Accounting & Tax News
(Accounting Today) Labor Department finalizes rule on employee vs. independent contractor status. The U.S. Department of Labor issued a final rule to clarify the standard for determining whether a worker should be considered an employee or an independent contractor. Read more.
(Accounting Today) IRS finalizes rules for claiming carbon capture tax credits. The Internal Revenue Service and the Treasury Department released final regulations on how businesses can claim a tax credit for use of carbon capture equipment to help the environment. The final rules aim to help businesses understand how the tax credit for qualified carbon oxide sequestration can benefit companies claiming two carbon capture credit amounts, which are:
- Up to $50 per metric ton of qualified carbon oxide for permanent sequestration; and
- Up to $35 per metric ton of qualified carbon oxide for Enhanced Oil or Natural Gas Recovery purposes.
Business News
(Accounting Today) IRS and Treasury extend safe harbor for renewable energy projects. The Internal Revenue Service and the Treasury Department released guidance that offers an extension of a safe harbor for developers of renewable energy projects located either offshore or on federal land. In Notice 2021-5, issued last week, the IRS and the Treasury said they will extend the safe harbor period for up to 10 calendar years after the year in which construction of a project began. Learn more.
(New Jersey Business) 5 Strategies for a Strong Start in 2021. A new year brings new possibilities. What can you do now to make 2021 the best year possible for your business? Learn more.
(New Jersey Business & Industry Association) Governor Signs Law to Reduce Unemployment Tax Hike Impacts. New Jersey businesses facing a potential $1 billion spike in payroll taxes this summer have been given a reprieve under legislation strongly supported by NJBIA that was signed into law late yesterday by the governor. Learn more.
COVID-19 Related News
(Accounting Today) IRS offers guidance on deducting PPP expenses. The Internal Revenue Service and the Treasury Department released guidance Wednesday on claiming deductions for expenses associated with Paycheck Protection Program loans that have been forgiven. The guidance in Revenue Ruling 2021-02 also reverses previous guidance issued last year by the IRS and the Treasury. Learn more.
(Construction Dive) Contractors to benefit from latest round of PPP funding. One of the most anticipated aspects of the $908 billion coronavirus relief measure signed by President Trump last week includes $284 billion for a revamped Paycheck Protection Program. Learn more.
(New Jersey Business Today) Murphy Signs Economic Recovery Act of 2020. The state has a new economic incentives program with the signing of the $14.4-billion New Jersey Economic Recovery Act of 2020. Learn more.
(New Jersey Business & Industry Association. Feds: Employers May Take FFCRA Tax Credit for Leave through March. Employers are not required to provide paid leave under the Families First Coronavirus Response Act (FFCRA) in 2021, but they may continue to do so on a voluntary basis in exchange for a tax credit available through March, according to recent guidance from the U.S. Department of Labor. Learn more.
(Philadelphia Business Journal) PPP Round 2: Here's which Philadelphia-area banks are and are not participating. With the Paycheck Protection Program's $284 billion restart slated to get underway next week, the Philadelphia Business Journal asked Philadelphia-area banks whether they plan to participate and, if so, whether they will accept applications from those who are not existing customers. We also asked them to assess the level of demand from local businesses. Read more.
(Philadelphia Business Journal) PPP loans not the only SBA program that got a boost from $900B stimulus. Other additional, smaller initiatives could also help cash-strapped or struggling small businesses. The biggest of those is the expansion of the employee retention tax credit, which has been extended through June 30. The tax credit, originally eligible to businesses that saw a decline of at least 50% in gross receipts, is now open to businesses that saw declines of 20% or more. Learn more.
(Philadelphia Business Journal) PPP loans: How fraudsters are targeting companies using SBA data. Wherever there is an influx of cash, scammers will follow close behind — even during a pandemic. Learn why.
(Philadelphia Business Journal) SBA just announced when the PPP portal will open. But there is a catch. The Small Business Administration’s Paycheck Protection Program will officially reopen Jan. 11, the agency confirmed Friday. The agency will only be accepting what its calling “first-draw” loans from small businesses that have yet to receive a PPP loan, and it will only be accepting those applications from lenders it has signaled as “community financial institutions.” The agency has defined those as Community Development Financial Institutions, minority deposit institutions, certified development companies and microloan intermediaries, which means those lenders will be able to process applications and submit them to the SBA first. On Jan. 13, small businesses applying for a second PPP loan will be able to do so, but once again only with community financial institutions. Read more.
Feel free to contact any member of our team at (610) 828-1900 (PA) or (732) 341-3893 (NJ) with questions. Rich Higgins, CPA, managing principal – New Jersey office can be contacted at Richard.Higgins@MCC-CPAs.com. I can be reached at Marty.McCarthy@MCC-CPAs.com. As always, we are happy to help.
Stay safe,
Marty McCarthy, CPA, CCIFP
Managing Partner
McCarthy & Company
Disclaimer: This alert is for informational purposes only and does not constitute professional advice. Information contained in this communication is not intended or written to be used as tax advice, and cannot be used by the recipient to avoid penalties that may be imposed under the Internal Revenue Code. We strongly advise you to seek professional assistance with respect to your specific issue(s).
