News for Your Week Ahead: June 25, 2021

Michael Ashley of Registered Agents joins Bill Feehley to talk about how he can help you incorporate a business, form a limited liability company, and handle your incorporation needs in all 50 states.

Watch on YouTube.

Coming Up: On Thursday, July 1st at 10 a.m., Jonathan Pocius of Payroll Services will be joining us to talk about how he help you with all your payroll needs including helping claim your employee retention credits!

Be sure to Like/Follow us on Facebook so you can catch MSATP TV live!

Businesses Must Report Nonemployee Compensation and Backup Witholding

By law, business taxpayers who pay or receive nonemployee compensation of $600 or more must report these payments to the IRS. They do this using Form 1099-NEC, Nonemployee Compensation.

Generally, payers must file Form 1099-NEC by January 31. For 2021 tax returns. There is no automatic 30-day extension to file Form 1099-NEC. However, an extension to file may be available under certain hardship conditions.

For more information, click here.

Draft PTE Forms and Administrative Release 6

The Comptroller’s Office has published guidance on the impact of SB 496 and SB 787 on Maryland’s pass-through entity tax.

Additionally, the Comptroller has published DRAFTs of revised Form 510, and new Form 511. These forms are still in draft format, and have been published for information only. They should not be filed until the Comptroller posts the final forms on June 29. The DRAFT forms can be found here: Draft 2020 Forms – Pass-Through Entity (marylandtaxes.gov).

Fed Raises Inflation Forecast, Shifts Timeline for Rate Increase | NFIB

NBC News (6/16) reported on its website that the Federal Reserve kept interest rates steady Wednesday “but dramatically raised its forecast for inflation and shifted up the timeline for a rate hike.” In a statement, Fed officials “acknowledged rising inflation, hiking their expectation for inflation to 3.4 percent from a March projection of 2.4 percent.” In what NBC News calls “a significant shift,” a “number of Fed officials indicated that two rate hikes could come as soon as 2023.” On its website, CNBC (6/16, Cox) reported that in March, the Federal Open Market Committee said “that it saw no increases until at least 2024.”

For more information, click here.

IRS Releases Data Book for Fiscal 2020 Describing Agency’s Activities During Pandemic | IR-2021-134

The Internal Revenue Service issued the Data Book detailing the agency’s activities during fiscal year 2020 (Oct. 1, 2019 – Sept. 30, 2020).

“This year’s Data Book describes the important work that IRS employees accomplish on behalf of the public,” said IRS Commissioner Chuck Rettig. “The IRS accounts for approximately 96% of the funding that supports the federal government’s operations, while proudly serving and interacting with more Americans than any other public or private organization.”

“The 2020 Data Book also details the extraordinary measures the IRS took to protect the health and safety of taxpayers and IRS employees during the COVID-19 pandemic while implementing critical economic relief legislation – the largest economic rescue packages in US history,” Rettig added.

For more information, click here.

Extension of Temporary Relief from the Physical Presence Requirement | N-2021-40

Notice 2021-40 provides a 12-month extension of the relief provided in Notice 2020-42, as extended by Notice 2021-3. For the period from July 1, 2021, through June 30, 2022, this notice extends two types of relief from the physical presence requirement in § 1.401(a)-21(d)(6)(i) for participant elections required to be witnessed by a plan representative or a notary public: (1) temporary relief from the physical presence requirement for any participant election witnessed by a notary public in a state that permits remote notarization (either by law or through an executive order), and (2) temporary relief from the physical presence requirement for any participant election witnessed by a plan representative. This notice also solicits comments on whether permanent guidance modifying the physical presence requirement in § 1.401(a)(21)-1(d)(6)(i) should be issued.

Notice 2021-40 will be in IRB: 2021-28, dated July 12, 2021.

For more information, click here.