Category: Taxation-Individuals

As consumers become more conscious of their environmental footprint and look for ways to save money, more and more electric vehicles can be seen on the roads today stretching from coast to coast. States are encouraging the purchasing of electric vehicles as well as exampled by California where the governor has taken action to ban the sale of non-electric vehicles after 2035. At this point, most taxpayers know or have heard of an electric vehicle tax credit program, but what… Read more ›

With the presidential election only weeks away, many people are beginning to pay closer attention to each candidate’s positions on such issues as the COVID-19 pandemic, health care, the environment and taxes. Among their many differences, President Donald Trump and former Vice President Joe Biden have widely divergent tax proposals. Their stances could have a major impact on the amount of taxes you’ll owe in the future. Here’s an overview of each candidate’s tax proposals for both individuals and businesses…. Read more ›

Beginning with Tax Year 2020, the IRS requires payments over $600 to nonemployees to be reported on the new Form 1099-NEC (Nonemployee Compensation). In prior years, these payments were reported on 1099-MISC. Why the new form? In prior years, the due date for Forms 1099-MISC depended on whether any nonemployee compensation was reported in Box 7. If so, the due date was January 31; otherwise the due date was February 28. The new form 1099-NEC was introduced to alleviate the… Read more ›

On August 28, the IRS issued guidance that provides some explanation of how employers can defer withholding and remitting an employee’s share of Social Security tax when wages are below a certain amount. The guidance in Notice 2020-65 was issued to implement President Trump’s executive action signed in early August. The guidance is brief, and private employers still have questions about whether, and how, to implement the deferral. The President’s action only defers Social Security taxes; it doesn’t forgive them,… Read more ›

On August 8, 2020, President Trump signed an executive memorandum that defers an employee’s portion of Social Security and Medicare taxes from September 1 through December 31, 2020. At this point, the taxes are just deferred, meaning they’ll still have to be paid at a later date. However, the action directs U.S. Treasury Secretary Steven Mnuchin to “explore avenues, including legislation, to eliminate the obligation to pay the taxes.” The exact impact on employers and employees isn’t yet known. There… Read more ›

On July 23, Richard Morris, Director of Tax Services co-authored an article for Harness Wealth on the topic of tax planning during a time of stock market volatility. Among the topics covered are what to avoid with regards to investments and how to handle Roth IRAs. Click here to read the full article. Councilor, Buchanan & Mitchell (CBM) is a professional services firm delivering tax, accounting and business advisory expertise throughout the Mid-Atlantic region from offices in Bethesda, MD and Washington, DC.   

Please note the following upcoming dates and descriptions for sales tax-free holidays in Virginia and Maryland: Virginia: Friday, August 7 to Sunday, August 9 Maryland: Sunday, August 9 to Sunday, August 15. These holidays offer periods of time when certain items can be purchased without sales tax in each state. Please see our overview of items eligible for the sales tax-free holiday. Washington, DC has no such sales tax holiday. Virginia Sales Tax-Free Holiday (August 7-9) In Virginia, individuals may… Read more ›

The CARES Act was enacted in an attempt to mitigate the economic effects of the COVID-19 pandemic. Among other things, it extends favorable tax treatment to qualified individuals who take so-called “coronavirus-related distributions” (CRDs) from IRAs, 401(k) plans and certain other retirement plans. RMD Relief Specifically, the CARES Act waives the 10% early distribution penalty for CRDs taken between January 1, 2020, and December 31, 2020. Under the law, the waiver applies to CRDs made to an individual: • Who’s… Read more ›

The IRS and the U.S. Department of Treasury have announced new relief for federal taxpayers affected by the coronavirus (COVID-19) pandemic. The IRS had already extended certain deadlines to file and pay federal income taxes and estimated tax payments due April 15, 2020, without incurring late filing penalties, late payment penalties or interest. The additional relief, outlined in Notice 2020-23, applies to a wider variety of tax filers. The IRS also has announced new tools for taxpayers expecting Economic Impact… Read more ›

On Friday, March 27, President Trump signed into legislation the Coronavirus Aid, Relief and Economic Security (CARES) Act. The $2.2 trillion legislation represents the largest stimulus package in U.S. history—dwarfing the $800 billion package signed during the 2008 financial crisis—and provides a variety of economic relief measures to mitigate the impact of the coronavirus pandemic on American society. The Act provides for six options for businesses in search of relief, which are listed below for consideration: • Paycheck Protection Program… Read more ›