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The IRS and the U.S. Treasury had disbursed 160.4 million Economic Impact Payments (EIP) as of May 31, 2020, according to a new report. These are the payments being sent to eligible individuals in response to the economic threats caused by COVID-19. The U.S. Government Accountability Office (GAO) reports that $269.3 billion of EIPs have already been sent through a combination of electronic transfers to bank accounts, paper checks and prepaid debit cards.

woman holding hundred dollar bills fanned out; image used for blog post about returning economic impact payments (EIP) during COVID-19 pandemic

Eligible individuals receive $1,200 or $2,400 for a married couple filing a joint return. Individuals may also receive up to an additional $500 for each qualifying child. Those with adjusted gross income over a threshold receive a reduced amount.

However, the IRS says some payments were sent erroneously and should be returned.

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Continue Reading You Might Need to Return Your EIP

There are many ways for a not-for-profit organization to lose its tax-exempt status — including participating in lobbying and campaign activities, receiving excessive unrelated business income and allowing board members to financially benefit from their positions. But the most common reason not-for-profits lose their status is failure to file an annual Form 990 or 990-N for three consecutive years.

man in a blue button down shirt holds a pen to paper to sign documents; image used for blog post about not-for-profits regaining tax-exempt status

If your organization has landed on the IRS’s revocation list for this reason, don’t panic. The process for reinstatement is relatively simple.

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Continue Reading Need to Regain Tax-Exempt Status for Your Not-for-Profit?

Many taxpayers don’t make the grade when it comes to recordkeeping. If you operate a small business, or you’re starting a new one, you probably know you need to keep records of your income and expenses. In particular, you should carefully record your expenses in order to claim the full amount of the tax deductions to which you’re entitled. And you want to make sure you can defend the amounts reported on your tax returns if you’re ever audited by the IRS or state tax agencies.

a file cabinet drawer open filled with organized file folders; image used for blog post about good recordkeeping for tax deductions and audits

Certain types of expenses, such as automobile, travel, meals and office-at-home expenses, require special attention because they’re subject to special recordkeeping requirements or limitations on deductibility.

It’s interesting to note that there’s not one way to keep business records. In its publication “Starting a Business and Keeping Records,” the IRS states: “Except in a few cases, the law does not require any specific kind of records. You can choose any recordkeeping system suited to your business that clearly shows your income and expenses.”

Here are three court cases to illustrate some of the issues.

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Continue Reading Make Sure You Have Good Recordkeeping

Nearly everyone has heard about potentially receiving an Economic Impact Payment (EIP), which the federal government is sending to help mitigate the effects of the coronavirus (COVID-19) pandemic. The IRS reports that in the first four weeks of the program, 130 million individuals received payments worth more than $200 billion.

one-dollar bills scattered across the floor; image used for blog post about economic impact payment during COVID-19 pandemic

However, some people are still waiting for a payment. And others received an EIP but it was less than what they were expecting. Here are some answers why this might have happened.

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Continue Reading Was Your Economic Impact Payment Lower Than Expected?

Millions of eligible Americans have already received their Economic Impact Payments (EIP) via direct deposit or paper checks, according to the IRS. Others are still waiting. The payments are part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

coins--pennies, quarters, dimes and nickels--pouring out of a glass jar into a pile; image used for blog post about answers for Economic Impact Payments during the COVID-19 pandemic

Here are some answers to questions you may have about EIPs.

Who’s eligible to get an EIP?
Eligible taxpayers who filed their 2018 or 2019 returns and chose direct deposit of their refunds automatically receive an Economic Impact Payment. You must be a U.S. citizen or U.S. resident alien and you can’t be claimed as a dependent on someone else’s tax return. In general, you must also have a valid Social Security number and have adjusted gross income (AGI) under a certain threshold.…
Continue Reading Economic Impact Payments – Answers to Your Questions

In the midst of the coronavirus (COVID-19) pandemic, Americans are focusing on their health and financial well-being. To help with the impact facing many people, the government has provided a range of relief.

close up image of a journal with black ink writing on top of papers for at ax statement for year 2019; image used for blog post about COVID-19 relief announced by the IRS

Here are some new announcements made by the IRS.

More Deadlines Extended
As you probably know, the IRS postponed the due dates for certain federal income tax payments — but not all of them. New guidance now expands on the filing and payment relief for individuals, estates, corporations and others.…
Continue Reading More COVID-19 Relief Announced by IRS

Internal Revenue Code (IRC) Section 512(a)(7) was recently retroactively repealed by the Taxpayer Certainty and Disaster Tax Relief Act of 2019. Section 512(a)(7) increased unrelated business taxable income by amounts paid or incurred for qualified transportation fringes, and Congress originally enacted this provision for amounts paid or incurred after December 31, 2017.

A person typing on an Apple Mac laptop; image used for blog post about claiming a refund for UBIT or adjusting Form 990-T

As a result…

The IRS announced it is opening the 2019 individual income tax return filing season on January 27. Even if you typically don’t file until much closer to the April 15 deadline (or you file for an extension), consider filing as soon as you can this year.

a black-ink pen lying next to tax withholding forms for a tax return

The reason: You can potentially protect yourself from tax identity theft — and you may obtain other benefits, too.

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Continue Reading Protect Yourself by Filing Your 2019 Tax Return Early