The Inflation Reduction Act, enacted in August 2022, significantly changed the qualifications for and calculation of the tax credit available for the purchase of an alternative fuel vehicle (electric and fuel cell vehicles). The Act created the Clean Vehicle Credit with one provision effective upon enactment and the remaining provisions phased in beginning in 2023. As a result of enactment, many vehicles that previously qualified for the credit earlier in 2022 no longer qualify and fewer vehicles will qualify for the full credit after April 18, 2023. Significant changes and their effective dates are discussed below.
The IRS has updated its FAQ sheet to reflect guidance issued in 2023.
The Department of Energy has compiled a list of eligible vehicles based on their delivery dates as the eligibility requirements changed for pre and post-Aug 17, 2022 and pre and post-April 18, 2023 deliveries: Department of Energy – Tax Incentives
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In early August 2022, a reduced version of the Biden Administration’s tax reform, climate change, green energy, and social policy agenda was passed by both the House and Senate. On August 16, 2022, President Biden signed the $750 billion Inflation Reduction Act of 2022 into law. The numerous changes will require significant guidance from multiple federal agencies to implement. With one exception, the Act’s provisions will be effective beginning January 1, 2023. We have summarized some of the key provisions below, and as guidance is released, will continue to keep you updated on how the Inflation Reduction Act may affect you or your business. (more…)
Although most COVID-19 relief programs have expired, many taxpayers are still sorting through lingering questions about their eligibility for various credits and grants. One such program, the Employee Retention Tax Credit (ERTC), has attracted particular attention in recent months.
The rules governing the ERTC are complex, and some eligible employers might not realize they qualify. Your company certainly should take advantage of tax credits for which it is eligible, and the ERTC was indeed a lifesaver for many businesses. (more…)
On June 30, 2022, California Governor Gavin Newsom signed a $308 billion budget package (Budget Act of 2022), which includes a direct tax refund for qualifying taxpayers. We have outlined some of the key tax related highlights from the budget, below. We will continue to keep you updated as we learn more about how the provisions in the budget may affect you or your business. (more…)
If your company is among the millions of businesses that still file paper versions of tax information returns such as Form W-2 and the various types of Form 1099, proposed new regulations from the IRS could soon affect you. The agency has proposed new regulations that would greatly expand the number of employers who are required to file these documents electronically rather than on paper.
The new rules are still subject to revision and the IRS has not yet officially announced when they will take effect. When they were first unveiled, however, the agency said it wanted to implement them by the end of this year. Companies that are still filing paper W-2s and 1099s should consider transitioning soon. (more…)
Update for fiscal year 2023-2024: The application periods and allocation amounts have been announced –
- July 24, 2023 – August 14, 2023 ($164 million in tax credits available; $120 million in grants available)
- January 2, 2024 – January 22, 2024 ($164 million in tax credits available)
- March 4, 2024 – March 18, 2024 ($164 million in tax credits plus any remaining unallocated amounts from the previous application periods)
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By Deepa Bhat, CPA, CFE, ACA, Principal
Starting in January 2023, businesses must conform to a new accounting standard for measuring expected credit loss. It’s perhaps one of the biggest accounting changes for financial institutions in a decade – but they’re not the only ones affected. Nonfinancial institutions may still have financial instruments and other assets that will require a different accounting approach and new internal controls. Implementing the current expected credit loss (CECL) accounting methodology takes a forward-looking approach to risk modeling and will be a significant undertaking for many. (more…)
Recently enacted California tax legislation included both good news and bad news for business owners. Senate Bill 113 (SB 113) contained a number of key and favorable changes made retro-active for the 2021 tax year. California Senate Bill 114 (SB 114) reinstated a mandatory COVID-19 supplemental sick leave requirement for employers. (more…)
With so many pandemic-driven changes to tax rules over the past 18 months, it’s easy to have overlooked some revisions. For example, recent changes to the deduction for business-related meal and entertainment (M&E) expenses may have slipped below the radar.
Earlier this year, the IRS issued Notice 2021-25 to provide updated guidance on M&E deductions. While you should always consult with your tax advisor for specific advice, it can be helpful to have a general understanding of what the current limits are and how they came about. (more…)