Small Business Bookkeeping Inc./Taxes Done Right

HUGE NEWS FOR BUSINESSES AND RESTAURANTS!

Treasury, IRS provide guidance on tax relief for deductions for food or beverages from restaurants
Businesses can temporarily deduct 100% beginning Jan. 1, 2021
WASHINGTON – The Treasury Department and the Internal Revenue Service today issued Notice 2021-25 providing guidance under the Taxpayer Certainty and Disaster Relief Act of 2020. The Act added a temporary exception to the 50% limit on the amount that businesses may deduct for food or beverages. The temporary exception allows a 100% deduction for food or beverages from restaurants.
Beginning Jan. 1, 2021, through Dec. 31, 2022, businesses can claim 100% of their food or beverage expenses paid to restaurants as long as the business owner (or an employee of the business) is present when food or beverages are provided and the expense is not lavish or extravagant under the circumstances.
Where can businesses get food and beverages and claim 100%?
Under the temporary provision, restaurants include businesses that prepare and sell food or beverages to retail customers for immediate on-premises and/or off-premises consumption. However, restaurants do not include businesses that primarily sell pre-packaged goods not for immediate consumption, such as grocery stores and convenience stores.
Additionally, an employer may not treat certain employer-operated eating facilities as restaurants, even if these facilities are operated by a third party under contract with the employer.

When you are gathering your tax info for 2020, remember two things that may be different from last year.

If you received unemployment, it is taxable so you need to wait on your 1099-G. It's the unemployment version of a W2.

Second, you will need the amounts of each stimulus payment you received. You don't pay taxes on this BUT if you were entitled to more than you got, you will get the additional in your refund so you definitely need to report it!

Have this information ready with your other tax documents before seeing your preparer.

Filing season doesn't open until February 12 this year.

IR-2021-16: 2021 tax filing season begins Feb. 12; IRS outlines steps to speed refunds during pandemic WASHINGTON ― The Internal Revenue Service announced that the nation's tax season will start on Friday, Feb. 12, 2021, when the tax agency will begin accepting and processing 2020 tax year returns.

2021 Employer Tax Rate Dear Arkansas Employer, Governor Hutchinson signed an executive order on D Arkansas Department of Commerce Division of Workforce Services 2 Capitol Mall ∙ P.O. Box 2981 ∙ Little Rock, AR 72203 DWS.ARKANSAS.GOV Dear Arkansas Employer, Governor Hutchinson signed an executive order on December 29, ...

As most of you know, the standard deduction is now higher than most peoples itemized deductions so people think they can't itemize. This is half true. You can still itemize on state even if you don't on federal and NOW there's an above the line deduction of $300 for charitable contributions that you can take even if you itemize on federal. So get those made before the end of the year!

Excerpt from IRS Newswire. "There’s a special tax deduction available through Dec. 31, 2020 for the many people who give cash donations up to $300 to qualifying charities."

https://www.irs.gov/newsroom/tax-day-now-july-15-treasury-irs-extend-filing-deadline-and-federal-tax-payments-regardless-of-amount-owed

Please read and share to get the word out on this!

Corporate extension (for some corporations) are due today. If you are a returining client of mine then you don't need to worry as I've taken care of it for you. If you aren't, then you need to get it taken care of!