Archives for Newsletter and Updates

Manny Trelles, CPA Tax Manager   Recently, the IRS issued additional guidance on crypto and virtual currency. The guidance addressed concerns regarding the timing of income recognition, tax basis, and clarification on terms in cryptocurrency transactions. Cryptocurrency is a type of virtual currency that uses cryptography to secure transactions that are digitally recorded on a distributed ledger, such as a blockchain. Virtual currency is a digital representation of value only available in electronic form. Cryptocurrency and income recognition A taxpayer who provides goods or services and receives an airdrop or payment in virtual currency has taxable income equal to the
Read More

Ryan Working, CPA, MST Tax Director   As a small to midsize business navigating the world of state income/franchise taxes can be difficult.  Every state has different rules, tax rates, and requirements for filing.  In this article, I will provide some basic concepts we use to help decide if an income/franchise tax return may be required in another state. Economic Presence: Historically, in order to be subject to taxes in a state you would need to have a physical presence in the state.  In recent years due to the development of significant court cases and e-commerce, the vast majority of
Read More

Dean Smith, CPA Audit & Accounting Partner   Revisions affecting defined contribution plans (including 401(k), money purchase and ESOP plans) subject to independent audits have been issued for 2023 plan years and beyond. On February 24, 2023, The Department of Labor and Internal Revenue Service issued final forms and related revised instructions for the 2023 Form 5500 filing series. The release includes what could be a significant change in the definition of a participant for purposes of determining whether the plan has exceeded the threshold to be considered a large plan, where an independent audit is required to be included
Read More

Manny Trelles, CPA Tax Manager   Recently, the US Supreme Court held that the $10,000 penalty for a non-willful failure to file a Report of Foreign Bank and Financial Accounts (FBAR) for foreign accounts accrued per report, not per account. (Bittner, No. 21-1195 [U.S. 2/28/23]). In the past, you may have been assessed a $10,000 penalty per account. For example, if a taxpayer failed to disclose 5 foreign bank accounts on the FBAR report, the penalty assessed may have been $50,000 ($10,000 per account). With the US Supreme Court ruling, a taxpayer may only be assessed a $10,000 penalty per
Read More

Richard A. Huffman, CPA, MST Tax Partner   The IRS and California recently announced that disaster-area taxpayers who reside in or have a business in the following California counties will now have until October 16, 2023 to file and remit payment for federal and California individual and business tax returns.  Previously the deadline had been postponed to May 15 for these areas: Alameda, Colusa, Contra Costa, El Dorado, Fresno, Glenn, Humboldt, Kings, Lake, Los Angeles, Madera, Marin, Mariposa, Mendocino, Merced, Mono, Monterey, Napa, Orange, Placer, Riverside, Sacramento, San Benito, San Bernardino, San Diego, San Francisco, San Joaquin, San Luis Obispo,
Read More

Manny Trelles, CPA Tax Manager   Governor Newsom signed SB 951 on September 30, 2022 repealing the wage ceiling for contributions into California’s State Disability Insurance (SDI) fund beginning January 1, 2024. This means all wages paid will be subject to California’s SDI tax. The purpose is to increase the SDI benefits paid and short-term disability insurance to three categories of employees: Employees on parental leave Employees taking time off to care for injured and ill family members Employees unable to work due to injury or health condition To pay for these increased benefits, SB 951 will eliminate the taxable
Read More