March 20, 2020 | Blog
Senate Republicans unveil $1 trillion economic stimulus package to address coronavirus fallout – Phil Mattingly, Clare Foran and Ted Barrett, CNN.
The Coronavirus Aid, Relief and Economic Security “CARES” Act is the latest measure by Congress to help mitigate pandemic distress. The bill includes a number of significant provisions for health workers, struggling businesses, and families. Several tax related provisions also made it into the bill, including a few that could pose challenges. Changes can be expected to win Democratic support for passage.
The much publicized proposed direct payment for certain individuals and families is meeting opposition as well, but reportedly “may have too much momentum to be stopped now”, says Sen. Kevin Cramer, a Republican of North Dakota.
One argument is that giving cash payments to people who have not lost their jobs may not make sense; instead, businesses should be supported to keep people employed during this time. Ensuring unemployment is available to all who do lose their jobs is critical as well.
Related: Eide Bailly’s summary of key tax provisions in the bill.
Hand Sanitizer Shortage Prompts Distillers to Seek Tax Exemption – Kaustuv Basu, BloombergTax
Two things getting us through the pandemic and quarantine may just be coming from the same producer: hand sanitizer and booze.
Spirits producers do have the capability to produce hand sanitizer that meets the specifications prescribed by the World Health Organization, said Brian Facquet, founder of Prohibition Distillery in New York.
If the industry receives requested excise tax waivers, it could prompt more distillers to join in. And in fact, it could help save their businesses.
China unveils more steps to support jobs as virus jolts economy – Lusha Zhang, Roxanne Liu and Kevin Yao, Reuters. “The government will quicken the resumption of operations at key firms and projects, especially in manufacturing, construction, logistics and public services, the cabinet said.”
Coronavirus relief bill contains tax credits for employers – Alistair M. Nevius, J.D., The Tax Adviser. “Subject to certain limitations, the bill provides an employer payroll tax credit that equals 100% of the qualified family leave wages paid by the employer.”
Lawmakers Concerned that Delay in Tax Filing Deadline Not Fully Understood – Erica York, Tax Foundation.
As if tax isn’t confusing enough, the IRS just created a debacle by delaying the tax payment deadline but not the tax return filing deadline.
While delaying payments is good, many are afraid that leaving the April 15 filing deadline in place could lead to confusion and hardship for taxpayers.
Eide Bailly’s FAQ on the matter should help clear up any misunderstandings but there is potential the fight isn’t over and the filing deadline will still be moved – stay tuned!
Unemployment helps after a job loss, but it’s taxable income – Kay Bell, Don’t Mess With Taxes. “As noted, unemployment benefits are not enough to make up for your lost wages. They are, however, enough for the Internal Revenue Service to collect taxes.”
A Refresher on U.S. Tax Court as It Starts Adapting to Covid-19 (1) – Kelly Phillips Erb, BloombergTax. “The court has also canceled several trial sessions through April 30. The court expects that parties will continue to work together to exchange information and address pending issues. Any unresolved cases will be scheduled for trial at a later date.”
IRS Clarifies Treatment of Grantor Trusts as Disregarded Entities – Eric Yauch, TaxNotes ($). “According to the IRS, grantor trusts should be listed as disregarded entities.”
This is a roundup of tax news and opinion. Any opinions expressed or implied are those of the author and not necessarily those of Eide Bailly. Opinions found in linked items are those of the authors of the linked item, not of your bloggers or of Eide Bailly. “$” means link may be behind a paywall. Items here do not constitute tax advice.