Keytax CPA

01/31/2023

Filing Season 2023 has begun: Employer January 31 wage statement deadline almost here. The Internal Revenue Service today urged employers to be aware of the January deadline to file Forms W-2 and other wage statements. Filing these documents timely prevents late-filing penalties for employers, helps employees file their income tax returns and prevents tax fraud.

01/26/2023

If you buy a new plug-in electric vehicle (EV) or fuel cell vehicle (FCV) in 2023 or after, you may qualify for a clean vehicle tax credit. Find out if you qualify.

12/09/2022

With Keytax Payroll, we save you time and money, so you can enjoy your business day with happy smiles.

Tax Preparation, Bookkeeping, Payroll, Consultation, LP / LLC / Corporation Forming

12/08/2022

IRS Warning Americans to Report $600 Transactions From Payment Processors or Risk Facing Audit

The Internal Revenue Service reminds taxpayers to report transactions of at least $600 made through payment networks like Venmo, Paypal, and Cash App as the agency seeks to obtain data regarding part-time employment and side gigs, a move that critics have termed government overreach.

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The Internal Revenue Service reminds taxpayers to report transactions of at least $600 made through payment networks like Venmo, Paypal, and Cash App as the agency seeks to obtain data regarding part-time employment and side gigs, a move that critics have termed government overreach. In a recent....

04/24/2020

COVID-19: SBA Clarifies PPP Loan for the Self-Employed with No Employees
Be ready! News reports say the SBA is out of money on the first round of funding. No problem. Round two is about ready to start.

If you are self-employed, with no employees, you absolutely need to qualify for this loan and its forgiveness (think free money). Here are three questions and answers that you need to know. Read on.

Question 1. I have income from self-employment, no employees, and file a Form 1040, Schedule C. Am I eligible for a Payroll Protection Program (PPP) Loan?

Answer 1. You are eligible for a PPP loan if


you were in operation on February 15, 2020;
you are an individual with self-employment income (such as an independent contractor or a sole proprietor);
your principal place of residence is in the United States; and
you have filed or will file a Form 1040 Schedule C for 2019.

Question 2. Since I have no employees, how do I calculate the maximum amount I can borrow and what documentation is required?

Answer 2. Follow the steps below:


Find your 2019 IRS Form 1040 Schedule C line 31 net profit. (If you have not yet filed your 2019 tax return, don’t fret, fill out the Schedule C now. You need it for the loan.) If the net profit amount is over $100,000, reduce it to $100,000.
Calculate the average monthly net profit amount (divide the amount from line 1 by 12).
Multiply the average monthly net profit amount from line 2 by 2.5.

In addition to your 2019 Schedule C to solidify your loan amount, you need documents to prove you are self-employed, such as a 2019 IRS Form 1099-MISC, invoice, bank statement, or book of record. You also must establish that you were in operation on or around February 15, 2020, with a 2020 invoice, bank statement, or book of record.

Question 3. What amount of the loan qualifies for forgiveness (remember, I don’t have any employees).

Answer 3. You are going to like this. With no employees, your loan forgiveness is


eight weeks’ worth (8/52) of your 2019 net profit (yes, last year—from that Schedule C we used for the loan amount);
mortgage interest paid during the covered period (eight weeks from loan receipt) on real or personal business property (the interest you deduct on Schedule C);
rent payments during the covered period on lease agreements in force before February 15, 2020, to the extent they are deductible on Form 1040 Schedule C (business rent payments); and
utility payments under service agreements dated before February 15, 2020, to the extent they are deductible on Form 1040 Schedule C (business utility payments).
The SBA will reduce your loan forgiveness by any COVID-19 qualified sick or family leave tax credit you claimed.
Example

Loan amount. Say your Schedule C shows $120,000 of net profit. Your limit is $100,000. Divide that by 12, and your monthly amount is $8,333. Multiply that by 2.5, and your loan amount is $20,833.

Loan forgiveness. Your loan forgiveness is $15,385 (8/52 of $100,000) plus qualifying interest, rent, and utilities not to exceed total loan forgiveness of more than $20,513.

Wow!

In this example, up to $20,513 is free money ($15,385 is the minimum free money). Make sure you are in a position to apply for the PPP loan because the funds are either there as you read this or coming soon.

04/10/2020

IRS Extends Tax Deadlines
The IRS issued guidance Thursday evening to grant deadline relief for both 1031 like-kind exchanges and opportunity zone investments that are already underway. Both of these programs are designed to promote economic growth in communities, and NAR made the case that investors in these programs should not be harmed due to the effects of COVID-19.


1031 Like-kind exchanges. If an investor has taken the first step of a like-kind exchange by selling the old property, and either the 45-day or the 180-day deadline falls between April 1 and July 15, the deadline has been extended to July 15.
Opportunity Zones. If an investor who sold a capital asset planned to roll over the gain into an Opportunity Fund and the 180-day deadline to do so falls between April 1 and July 15, 2020, he or she can make the investment as late as July 15.

Also, sole proprietors who pay quarterly estimated taxes now have until July 15 to file their second quarter payment. As a result of an earlier IRS notice, first quarter estimated tax payments had already been extended to July 15. This means that any individual or corporation that has a quarterly estimated tax payment due on or after April 1, 2020, and before July 15, 2020, can wait until July 15 to make that payment, without penalty.

04/10/2020

Who is eligible for the Economic Impact Payment?
U.S. citizens or resident aliens who:

Have a valid Social Security number,
Could not be claimed as a dependent of another taxpayer, and
Had adjusted gross income under certain limits.
Who will receive the Economic Impact Payment automatically without taking additional steps?
Most eligible U.S. taxpayers will automatically receive their Economic Impact Payments including:

Individuals who filed a federal income tax for 2018 or 2019
Individuals who receive Social Security retirement or Social Security Disability Insurance benefits
Individuals who receive Railroad Retirement benefits
Who should use Non-Filers: Enter Payment Info to provide additional information to receive the Economic Impact Payment?
Eligible U.S. citizens or permanent residents who:

Had gross income that did not exceed $12,200 ($24,400 for married couples) for 2019
Were not otherwise required to file a federal income tax return for 2019, and didn't plan to
You can provide the necessary information to the IRS easily and quickly for no fee through Non-Filers: Enter Payment Info. We will use this information to determine your eligibility and payment amount and send you an Economic Impact Payment. After providing this information you won’t need to take any additional action.

Information You will Need to Provide
Full name, current mailing address and an email address
Date of birth and valid Social Security number
Bank account number, type and routing number, if you have one
Identity Protection Personal Identification Number (IP PIN) you received from the IRS earlier this year, if you have one
Driver’s license or state-issued ID, if you have one
For each qualifying child: name, Social Security number or Adoption Taxpayer Identification Number and their relationship to you or your spouse
What to Expect
Clicking “Non-Filers: Enter Payment Info Here” above will take you from the IRS site to Free File Fillable Forms, a certified IRS partner. This site is safe and secure.

Follow these steps in order to provide your information:

Create an account by providing your email address and phone number; and establishing a user ID and password.
You will be directed to a screen where you will input your filing status (Single or Married filing jointly) and personal information.
Note: Make sure you have a valid Social Security number for you (and your spouse if you were married at the end of 2019) unless you are filing “Married Filing Jointly” with a 2019 member of the military. Make sure you have a valid Social Security number or Adoption Taxpayer Identification Number for each dependent you want to claim for the Economic Impact Payment.
Check the “box” if someone can claim you as a dependent or your spouse as a dependent.
Complete your bank information (otherwise we will send you a check).
You will be directed to another screen where you will enter personal information to verify yourself. Simply follow the instructions. You will need your driver’s license (or state-issued ID) information. If you don’t have one, leave it blank.
You will receive an e-mail from Customer Service at Free File Fillable Forms that either acknowledges you have successfully submitted your information, or that tells you there is a problem and how to correct it. Free File Fillable forms will use the information to automatically complete a Form 1040.

Fillable Forms

04/07/2020

ECONOMIC IMPACT PAYMENTS: WHAT YOU NEED TO KNOW

Check IRS.gov for the latest information: No action needed by most people at this time
IR-2020-61, March 30, 2020

WASHINGTON — The Treasury Department and the Internal Revenue Service today announced that distribution of economic impact payments will begin in the next three weeks and will be distributed automatically, with no action required for most people. However, some taxpayers who typically do not file returns will need to submit a simple tax return to receive the economic impact payment.

Who is eligible for the economic impact payment?
Tax filers with adjusted gross income up to $75,000 for individuals and up to $150,000 for married couples filing joint returns will receive the full payment. For filers with income above those amounts, the payment amount is reduced by $5 for each $100 above the $75,000/$150,000 thresholds. Single filers with income exceeding $99,000 and $198,000 for joint filers with no children are not eligible. Social Security recipients and railroad retirees who are otherwise not required to file a tax return are also eligible and will not be required to file a return.

Eligible taxpayers who filed tax returns for either 2019 or 2018 will automatically receive an economic impact payment of up to $1,200 for individuals or $2,400 for married couples and up to $500 for each qualifying child.

How will the IRS know where to send my payment?
The vast majority of people do not need to take any action. The IRS will calculate and automatically send the economic impact payment to those eligible.

For people who have already filed their 2019 tax returns, the IRS will use this information to calculate the payment amount. For those who have not yet filed their return for 2019, the IRS will use information from their 2018 tax filing to calculate the payment. The economic impact payment will be deposited directly into the same banking account reflected on the return filed.

The IRS does not have my direct deposit information. What can I do?
In the coming weeks, Treasury plans to develop a web-based portal for individuals to provide their banking information to the IRS online, so that individuals can receive payments immediately as opposed to checks in the mail.

I am not typically required to file a tax return. Can I still receive my payment?
Yes. The IRS will use the information on the Form SSA-1099 or Form RRB-1099 to generate Economic Impact Payments to recipients of benefits reflected in the Form SSA-1099 or Form RRB-1099 who are not required to file a tax return and did not file a return for 2018 or 2019. This includes senior citizens, Social Security recipients and railroad retirees who are not otherwise required to file a tax return.

Since the IRS would not have information regarding any dependents for these people, each person would receive $1,200 per person, without the additional amount for any dependents at this time.

I have a tax filing obligation but have not filed my tax return for 2018 or 2019. Can I still receive an economic impact payment?
Yes. The IRS urges anyone with a tax filing obligation who has not yet filed a tax return for 2018 or 2019 to file as soon as they can to receive an economic impact payment. Taxpayers should include direct deposit banking information on the return.

I need to file a tax return. How long are the economic impact payments available?
For those concerned about visiting a tax professional or local community organization in person to get help with a tax return, these economic impact payments will be available throughout the rest of 2020.

Where can I get more information?
The IRS will post all key information on IRS.gov/coronavirus as soon as it becomes available.

The IRS has a reduced staff in many of its offices but remains committed to helping eligible individuals receive their payments expeditiously. Check for updated information on IRS.gov/coronavirus rather than calling IRS assistors who are helping process 2019 returns.

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The Treasury Department announced that Economic Impact Payments (EIP) will be distributed automatically, with no action required for most taxpayers. However, taxpayers who have not had a filing requirement for the last two years and don't receive Social Security payments should file a "simple" EIP return in order to receive their payment from the IRS.

https://www.irs.gov/newsroom/economic-impact-payments-what-you-need-to-know

To explain the tax relief for those affected by coronavirus.

03/27/2020

ECONOMIC INJURY DISASTER LOAN ASSISTANCE

Small business owners in all U.S. states, Washington D.C., and territories are currently eligible to apply for a long-term, low-interest loan due to Coronavirus (COVID-19).

The SBA’s Economic Injury Disaster Loan program provides small businesses with working capital loans of up to $2 million that can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.

If you are applying for disaster assistance for another declaration, then please see the home owner's and renter's form from:
www.disasterloan.sba.gov/apply-for-disaster-loan/index.html -loan

INSTRUCTIONS TO APPLY

Download forms below
Fill in your information
Upload forms on this page below
If you choose to mail, then please see Mailing Instructions below

DOWNLOAD BUSINESS FORMS
Business Loan Application (Form 5) (en Español)
Home or Sole Proprietor Loan Application (SBA Form 5C) (en Español)
Economic Injury Disaster Loan Supporting Information (Form P-019)

ADDITIONAL FORMS

A Disaster Assistance loan officer may request you to fill out the following additional forms:

Fee Disclosure Form and Compensation Agreement (Form 159D)
Personal Financial Statement (SBA Form 413D) (en Español)
Request for Transcript of Tax Return (IRS Form 4506-T)
Instructions for Request for Transcript of Tax Return (IRS Form 4506-T)(en Español)
Schedule of Liabilities (SBA Form 2202)
Instructions for Schedule of Liabilities (SBA Form 2202)
Schedule of Liabilities (SBA Form 2202) (en Español)
PUERTO RICO ONLY: Release of Inheritance and Donation (Modelo SC 2907) (en Español)
PUERTO RICO ONLY: Hacienda Statement of Authorization
Additional Filing Requirements (SBA Form 1368)
Additional Filing Requirements (SBA Form 413D) (en Español)

PLEASE CHECK OUT THIS LINK FOR MORE INFORMATION:

www.disasterloan.sba.gov/apply-for-disaster-loan/index.html -loan

Submit your Small Business Disaster Loan Application through this form

01/03/2020

IT'S TAX SEASON!

Are you ready to file Tax Return for 2019?

MARCH 15 is the deadline for Partnership, Multi-Member LLC, and S-Corporation Returns or Extension.

APRIL 15 is the deadline for Individuals, Sole-Member LLC, Calendar-Year Estate/Trust, and C-Corporation Returns or Extension.

For appointment inquiries, please call and/or email us!

We can be reached at 408-580-6000 or [email protected]

Our Office Hours are:
January 2020, Monday to Friday, 9:30AM to 5PM
February to April 15th, 2020, Monday to Friday, 9:30AM to 7PM Saturday, 10AM to 6PM

If you are running out of time to gather your tax documents, please let us know so we can file extension for you.

12/23/2019

As the year ends, we think about all we are grateful for.Our relationship with you is one thing we treasure.Thank you for the opportunity to serve you. It has been a pleasure helping you reach your goals.We look forward to contributing to your success in 2020. We wish you a Merry Christmas and a prosperous New Year!