Dunham Associates CPAs

01/12/2024

Employer Deadline to File Wage Statements is January 31:
The IRS would like to remind employers that 1/31/24 is the deadline to file wage statements and forms for independent contractors. The forms required to be filed by this deadline include Form W-2, Form W-3, Form 1099-MISC, and Form 1099-NEC. Form W-2 and Form W-3 must be filed with the Social Security Administration and Form 1099-MISC and Form 1099-NEC must be filed with the IRS. New electronic filing requirements are also in effect beginning in 2024. Businesses that file at least 10 information returns, must file W-2s and certain information returns electronically. The Information Returns Intake System (IRIS) is a free electronic filing service for the Form 1099 series and is offered by the IRS. This online portal can also be used to prepare payee copies for distribution, file corrections, and request automatic extensions.

05/12/2022

Dunham Associate Lunch at Din Tai Fung.

01/05/2021

IRS Delivering Second Round of Economic Impact Payments:

The IRS began delivering the second round of Economic Income Payments (EIPs) via direct deposit and paper checks. Payments are automatic for eligible taxpayers who filed a 2019 tax return; those who receive Social Security retirement, survivor, or disability benefits; those who receive Railroad Retirement benefits; and Supplemental Security Income (SSI) and Veterans Affairs beneficiaries who didn't file a tax return. Payments also are automatic for anyone who successfully registered for the first EIP online at www.irs.gov using the agency's "Non-Filers tool" by 11/21/20, or who submitted a simplified tax return that has been processed by the IRS. Taxpayers receiving automatic payments should not contact their financial institutions or the IRS with payment timing questions.

Get My Economic Impact Payment Get Coronavirus Tax Relief Get Your Refund Status Tax Professionals: Renew Your PTIN Get Your Tax Record View Your Account Make a Payment Apply for an Employer ID Number (EIN) Forms and Instructions 1040 and Schedules 1-3 Individual Tax Return Other 1040 Schedules Info...

10/15/2020

Social Security Wage Base Increases for 2021:

The Social Security Administration (SSA) has announced that the maximum earnings subject to the Social Security component of the F**A tax will increase from $137,700 to $142,800 for 2021. This means that for 2021, the maximum Social Security tax that employers and employees will each pay is $8,853.60 ($142,800 x 6.2%). The Medicare component remains 1.45% of all earnings, and individuals with earned income of more than $200,000 will pay an additional 0.9% in Medicare taxes.

04/09/2020

What if I am unable to file my 2019 income tax return that would have been due on April 15 by July 15, 2020?

If you are an individual, you can request an automatic extension to file your Federal income tax return if you can’t file by the July 15 deadline. The easiest and fastest way to request a filing extension is to electronically file Form 4868 through your tax professional. Businesses, including trusts, must file Form 7004.
You must request the automatic extension by July 15, 2020. If you properly estimate your 2019 tax liability using the information available to you and file an extension form by July 15, 2020, your tax return will be due on October 15, 2020. To avoid interest and penalties when filing your tax return after July 15, 2020, pay the tax you estimate as due with your extension request.

04/01/2020

REAL PROPERTY TAXES
The state does not have the authority to extend the payment of property taxes because critical local services such as schools, fire, and police are dependent on this revenue. The California Association of County Treasurers and Tax Collectors have stated that they can waive penalties, costs, or other charges resulting from tax delinquency due to reasonable cause related to this crisis.4 Note: April 10 falls on a Friday, but offices may be closed in some areas due to the COVID-19 virus. Contact the County office for more information.
Payments may be made by mailing in a check (postmarked by April 10), paying online either by e-check (no fee) or by credit card (2.5% fee) through the county website, or paying by the phone system.

04/01/2020

Stimulus payments
• The payment is an advance payment of a 2020 tax credit;
• The maximum credit is $1,200 per individual ($2,400 MFJ) plus $500 per qualifying child under 17 years old;
• The credit is phased out by 5% ($5 for every $100 over the limit) for AGIs exceeding:
o $150,000 for MFJ — phased out at $198,000 if there are no children;
o $112,500 for HOH filers — phased out at $146,500 if the HOH has one child;
o $75,000 for all other taxpayers — phased out at $99,000; and
o For every child claimed, add an additional $10,000.
• 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 stimulus payment will be deposited directly into the same banking account reflected on the return filed;
• For taxpayers who did not provide direct deposit information, in the coming weeks the 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; and
• For individuals who did not file a 2018 or 2019 return, the IRS is developing a simplified process for them to file.
Here is a link to the IRS's FAQs on these payments:

IR-2020-61, March 30, 2020 — 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.

04/01/2020

Payroll Protection loans
In addition to the tax provisions we previously reported, the CARES Act provides for Payroll Protection loans of up to $10 million to COVID-19 impacted businesses:
• The loans are guaranteed 100% by the Small Business Administration (no personal guarantees or collateral required);
• Businesses with 500 or fewer employees can borrow 2.5 times their average monthly payroll, up to a maximum of $10 million;
• The loans may be forgiven for amounts used to cover basic operating expenses such as payroll costs, rent and mortgage, and utilities for up to eight weeks from the loan origination date;
• Loan forgiveness will be reduced by reductions in employee compensation or layoffs of employees over the last year;
• The canceled debt will not generate taxable income;
• Businesses that take these loans will not qualify for the Employer Retention Credit;
• Any loan amount that isn't forgiven has a maximum term of 10 years and a maximum interest rate of 4%; and
• At press time, the SBA had not provided information to banks on the loan process, but we expect that to happen soon.

01/02/2020

The optional standard mileage rates for business use of a vehicle will decrease slightly in 2020 after increasing significantly in 2019. For business use of a car, van, pickup truck, or panel truck, the rate for 2020 will be 57.5 cents per mile in 2020, down from 58 cents per mile last year after increasing from 54.5 cents per mile in 2018. Taxpayers can use the optional standard mileage rates to calculate the deductible costs of operating an automobile.

11/25/2019

IRS Releases 2020 Qualified Retirement Plan Amounts:

The IRS has released cost-of-living adjustments to pension plans and other retirement-related items for 2020:

(1) elective deferral limit for employees participating in 401(k), 403(b), and most 457 plans has increased from $19,000 to $19,500;
(2) catch-up contribution limit for employees aged 50 and over participating in 401(k), 403(b), and most 457 plans has increased from $6,000 to $6,500;
(3) limit on annual contributions to a SIMPLE plan has increased from $13,000 to $13,500; and
(4) defined contribution plan limit has increased from $56,000 to $57,000.

11/21/2019

IRS Cracks Down on Abusive Syndicated Conservation Easements:
The IRS has announced that it will significantly increase enforcement actions related to abusive syndicated conservation easements. According to the agency, coordinated examinations are being conducted. In addition, investigations have been initiated by the Criminal Investigation Division. These actions cover billions of dollars of potentially inflated deductions, as well as hundreds of partnerships and thousands of investors. The IRS also is investigating promoters, appraisers, tax return preparers, and others involved in marketing abusive syndicated conservation easements. The agency reminds taxpayers that certain syndicated conservation easements are listed transactions and subject to substantial penalties. To avoid penalties, taxpayers should file an amended return that fully removes the improper contribution and related tax benefits.

11/08/2019

IRS Releases 2020 Qualified Retirement Plan Amounts:

The IRS has released cost-of-living adjustments to pension plans and other retirement-related items for 2020. Many of the limits applicable to pension and other retirement plans have increased. For instance, the

(1) elective deferral limit for employees participating in 401(k), 403(b), and most 457 plans has increased from $19,000 to $19,500;
(2) catch-up contribution limit for employees aged 50 and over participating in 401(k), 403(b), and most 457 plans has increased from $6,000 to $6,500;
(3) limit on annual contributions to a SIMPLE plan has increased from $13,000 to $13,500; and (4) defined contribution plan limit has increased from $56,000 to $57,000.