Tax Section Odyssey

The 2021 PCPS CPA Firm Top Issues Survey polled firms of all sizes to get a pulse on the top pressing issues impacting them. In this Tax Section Odyssey episode, April Walker, CPA, CGMA, from the AICPA Tax Section and Brad Barbour, CPA, from the AICPA Private Companies Practice Section, and host of the Small Firm Philosophy podcast discuss tax-related challenges that emerged in the 2021 CPA Firm Top Issues Survey. What you’ll learn in this episode Overview of the survey and highlights of results (1.18) What’s happening with tax law that is keeping practitioners up at night (2.07) Advice from the AICPA Tax Section to help tax practitioners remain up to date and communicate tax changes with clients (3.07) Challenges when working with the IRS (5.01) Relevant AICPA Tax Section resources (8.00) Resources available to help practitioners deal with workload and deadlines (10.24) Staffing issues (13.20) A page from Brad’s travel journal (15.41) AICPA resources Resources to address CPA firm top issues — The PCPS and the AICPA provide a variety of resources that can help address the issues identified in the 2021 PCPS CPA Firm Top Issues Survey. Also included in this toolkit is the Client Evaluation Tool. PCPS CPA Firm Top Issues Survey — Professional insights highlighting the results of the biannual firm top issues survey conducted in May and June of 2021. Small Firm Philosophy podcast — This podcast shares big ideas about small firms. You'll hear from leaders of small accounting firms about their philosophies on running a successful practice in today's rapidly changing environment. AICPA tax hub — Compendium of tax guidance and resources. IRS Hotlines Quick Reference Chart — Summary of contact telephone numbers for various IRS departments to help practitioners resolve IRS tax matters for their clients. Contacting the IRS FAQs — Answers to frequently asked questions help you navigate your correspondence and activities with the IRS. Client Termination Practitioner Checklist and Notification Letter — This checklist will guide you through some important items to keep in mind when terminating a client relationship. The notification letter is used to notify a client about the termination of your professional relationship with them and remind them of other unsettled matters. Extension Reminder Letter for Client Tax Return — Customizable letter to send to your clients to help them understand the tax return extension process and inform them of what financial information you need from them and when. Other resources IRS Operations During COVID-19: Mission-critical functions continue — COVID-19 continues to cause delays in IRS services. The page is kept up to date to inform taxpayers and practitioners of the status of IRS functions. Note: If your podcast app does not hyperlink to resources, visit https://taxodyssey.libsyn.com to access show notes with direct links. This episode is brought to you by the AICPA’s Tax Section, your home base to maintain your professional edge. To learn more about the Tax Section, check out aicpa.org/tax or sign up for a free web tour.

As virtual currencies gain more traction in the marketplace, the IRS is taking notice. Your clients may be unaware of the tax reporting requirements and the tax implications from their cryptocurrency transactions.  In this Tax Section Odyssey episode, April Walker, CPA, CGMA, Lead Manager — Tax Practice & Ethics, Association of International Certified Professional Accountants, representing AICPA & CIMA, and Shehan Chandrasekera, CPA, Head of Tax Strategy — CoinTracker, delve into the cryptic world of virtual currency and discuss practical tax compliance tips.   What you’ll learn in this episode History and the basics of cryptocurrency (1.01) Advantages and benefits of owning and transacting with cryptocurrency (2.39) Non-fungible tokens (NFTs) (4.18) The taxation of cryptocurrency and IRS guidance (5.56) Advice to clients regarding cryptocurrency activity and transaction tracking (8.39) How to answer the virtual currency question on the Form 1040 (10.53) Potential tax legislation and virtual currency (13.01) What to do when a client receives an IRS letter or notice regarding virtual currency activity (15.07) Journal of Accountancy podcast episode that focuses on the recent annual tax software survey (18.43) AICPA resources Virtual currency tax guidance and resources — Consolidation of AICPA resources, comment letters and IRS guidance to help tax practitioners advise clients on cryptocurrency complexities Blockchain & Digital Assets — Hub of resources around this increasingly-common technology Other resources Coinmarketcap.com — Website consolidating the various cryptocurrency properties and current prices IRS Notice 2014-21 —IRS guidance for individuals and businesses on the tax treatment of transactions using virtual currencies Rul. 2019-24 — IRS guidance that addresses common questions by taxpayers and tax practitioners regarding the tax treatment of a cryptocurrency hard fork The IRS also published Frequently Asked Questions on Virtual Currency Transactions for individuals who hold cryptocurrency as a capital asset and are not engaged in the trade or business of selling cryptocurrency CoinTracker — Software to help track cryptocurrency investment performance and taxes. Lukka — Data and software solutions to manage crypto assets on infrastructure built for the future of commerce. In December 2019, CPA.com announced a strategic alliance with Lukka to deliver crypto asset solutions to firms. IRS Cryptocurrency Tax Letter Guide: 6173, 6174, 6174-A, CP-2000 — Step-by-step guide to help taxpayers know what to do if they receive a cryptocurrency-related letter from the IRS Tax software: What CPAs like and dislike — Journal of Accountancy podcast where editors Alistair Nevius and Paul Bonner discuss details of the annual tax software survey. Note: If your podcast app does not hyperlink to resources, visit https://taxodyssey.libsyn.com to access show notes with direct links. This episode is brought to you by the AICPA’s Tax Section, your home base to maintain your professional edge. To learn more about the Tax Section, check out aicpa.org/tax or sign up for a free web tour.

As a tax practitioner during the revolving door of tax law changes this year, you might have asked yourself questions such as: Can I bill my clients for PPP loan assistance? How do I bill my clients for employee retention credit consultations? How do I get my long-time clients to value and agree to pay for the high-quality services that I offer each year? If any of the above apply, we have some tips. Loren Fogelman, a business coach for accounting professionals at Business Success Solution, provides some best practices on how to innovate your billing practices for the future.  What you’ll learn in this episode Low-value vs. high-value clients (2.07) Ways that firms and practitioners can attract the right kind of clients (6.52) How firms determine whether it is time to move on from a client relationship (9.18) Step-by-step process to raise rates for existing clients (11.53) How to determine package services and pricing (14.40) The lowdown on timesheets and hourly rates (18.48) Formula for best pricing (20.22) How to handle situations when clients do comparison shopping with each other (24.10) Four takeaways on clients’ perceptions of value (27.08) AICPA resources CPA Marketing Toolkit — These tools help you demonstrate your strength as a trusted adviser, assisting with all aspects of your clients’ financial situations. Other resources 10 steps to package and price your services — A free resource from Business Service Solutions that lists steps to transition from hourly rates to packages. Note: If your podcast app does not hyperlink to resources, visit https://taxodyssey.libsyn.com to access show notes with direct links. This episode is brought to you by the AICPA’s Tax Section, your home base to maintain your professional edge. To learn more about the Tax Section, check out aicpa.org/tax or sign up for a free web tour.

The impact of disasters can be life changing. Fortunately, special tax law provisions may aid in the recovery efforts for individual taxpayers and businesses alike. Depending on the circumstances, the IRS may grant additional time to file returns and pay taxes. Victims may also be able to deduct casualty losses that occurred. In this Tax Section Odyssey podcast episode, Jerry Schreiber, CPA, partner at Schreiber & Schreiber in Louisiana, the recipient of the AICPA’s 2018 Arthur J. Dixon Memorial Award and dubbed the “Master of Disaster,” along with Amy Miller, JD, CPA, Senior Manager — AICPA Tax Policy & Advocacy, Association of International Certified Professional Accountants, representing AICPA & CIMA, join April Walker, CPA, CGMA, Lead Manager — Tax Practice & Ethics, Association of International Certified Professional Accountants, representing AICPA & CIMA, to discuss tax-related disaster relief and insights to resources available for taxpayers and their CPA practitioners.    What you’ll learn in this episode Top AICPA member concerns during disasters (1.18) How tax relief is applied if either the CPA practitioner or the client is not located in the disaster area (2.30) Summary of the steps CPA practitioners can take to help clients impacted by a disaster (3.38) Tax-deductible charitable contributions (7.17) How CPA practitioners can assist their business clients in disaster situations (11.18) AICPA advocacy efforts in the disaster arena (12.36) Helpful resources in times of disasters (16.28)  AICPA resources: Disaster Tax Relief Guidance and Resources —Provides answers to frequently asked questions (FAQs) concerning a disaster, casualty or theft; how these events may impact a client’s tax returns and business affairs and a list of valuable resources to help navigate the complexities of a disaster. Disaster financial issues tools to help with disaster recovery — Tools included on this page include the Disaster and Financial Planning Guide and Disaster and Financial Planning Guide Checklists by the American Red Cross. Other resources: Guides for CPAs to providing disaster assistance — Please contact Jerry Schreiber at ghschreiber@bellsouth.net to request detailed, state-specific guides on disaster-related topics, including the disaster declaration process, tax implications of disasters, IRS filing relief, insurance company claim numbers and FAQs on charitable contributions for aid given to disaster victims. The guides are frequently updated. LA-2021-04, August 31, 2021 — IRS announces tax relief for victims of Hurricane Ida in Louisiana IR-2021-175, August 31, 2021 — IRS announces tax relief to victims of Hurricane Ida fema.gov — The official website of the Federal Emergency Management Agency Revenue Procedure 2018-08 —Provides safe harbor methods that may be used in the case of casualty and theft losses occurring as a result of any federally declared disaster. Tax Relief in Disaster Situations — IRS website housing the most recent tax relief provisions for taxpayers affected by disaster situations Publication 584, Casualty, Disaster, and Theft Loss Workbook — Designed to help to help taxpayers figure losses on personal-use property in the event of a disaster, casualty or theft. Publication 584-B, Business Casualty, Disaster, and Theft Loss Workbook — Designed to help taxpayers figure losses on business and income-producing property in the event of a disaster, casualty or theft. Note: If your podcast app does not hyperlink to resources, visit https://taxodyssey.libsyn.com to access show notes with direct links. This episode is brought to you by the AICPA’s Tax Section, your home base to maintain your professional edge. To learn more about the Tax Section, check out aicpa.org/tax or sign up for a free web tour.

The Association of International Certified Professional Accountants provides the world’s most highly skilled accountants with knowledge, insight and foresight to meet the demands of a disruptive world. It is a driving force in a dynamic profession that powers trust, opportunity and prosperity for people, businesses and economies worldwide.   But the Association can’t do its work without the dedicated group of volunteers behind the scenes. Approximately 2,500 volunteers serving across nearly 200 official groups work and are committed to protecting the public interest, speaking with the power of more than 650,000 professional accountants and students around the world. In addition, all AICPA conferences have volunteer committees that work diligently on the logistics and content creation to help plan the spectacular events held year-round.   In this Tax Section Odyssey episode, April Walker, CPA, CGMA, Lead Manager — Tax Practice & Ethics, Association of International Certified Professional Accountants, representing AICPA & CIMA, and Brandon LaGarde, CPA, JD, LLM, Director — Postlethwaite & Nettervile, chat about what it means to volunteer with the Association on official groups and with conference planning committees.   What you’ll learn in this episode Tips on making the most of a conference experience (1.07) An important tidbit Brandon learned at the recent ENGAGE 2021 conferences (7.05) Brandon’s experience volunteering with the AICPA and advice for others (8.49) How and where to submit a volunteer application in Volunteer Central (12.31) How to express interest in speaking at a conference (13.04) Overarching thoughts about volunteering at the AICPA (15.58) AICPA resources Volunteer Central – Repository of the official AICPA volunteer groups and hub for the volunteer application process. Webcasts & Conferences – Explore all the upcoming conferences and filter by such categories as topic, content type and CPE credits to find your next event. Email the Tax Section – Let us know if you’re interested in learning more about volunteer opportunities in tax.   Note: If your podcast app does not hyperlink to resources, visit https://taxodyssey.libsyn.com to access show notes with direct links. This episode is brought to you by the AICPA’s Tax Section, your home base to maintain your professional edge. To learn more about the Tax Section, check out aicpa.org/tax or sign up for a free web tour.

The employee retention credit (ERC) is a new credit created in the Coronavirus Aid, Relief, and Economic Security (CARES) Act passed in March 2020 and later modified with subsequent legislation. Tax preparers and their clients have been anticipating updated guidance on several remaining questions related to the ERC. On August 4, the IRS issued Notice 2021-49 and accompanying IR-2021-165. Further, on August 10, the IRS issued Rev. Proc. 2021-33, which provides a safe harbor permitting employers to exclude certain amounts from gross receipts solely for purpose of determining eligibility for the ERC. Notice 2021-49 provides guidance on the ERC provided under Sec. 3134 of the Internal Revenue Code, as added by Sec. 9651 of the American Rescue Plan Act of 2021, and applies to qualified wages paid after June 30, 2021, and before Jan. 1, 2022. The notice amplifies Notices 2021-20 and 2021-23 with additional guidance on claiming the ERC in the third and fourth calendar quarters of 2021 as well as guidance on several miscellaneous ERC concerns. In this Tax Section Odyssey episode, April Walker, CPA, CGMA, Lead Manager — Tax Practice & Ethics, Association of International Certified Professional Accountants, representing AICPA & CIMA, and Kristin Esposito, CPA, MST, Director — Tax Policy & Advocacy, Association of International Certified Professional Accountants, representing AICPA & CIMA, dissect the latest guidance. What you’ll learn in this episode Are wages of >50% shareholders and their spouses are considered qualified wages? (2.25) The calculation of gross receipts and a discussion on how Paycheck Protection Program (PPP) loans and other COVID-19 relief programs are incorporated (3.56) Are cash tips considered qualified wages? (5.25) The use of full-time employees or full-time equivalents in the determination of whether a business is a small or a large-eligible employer and the period for this calculation (5.53) Timing of the wage deduction disallowance (7.11) Determination of eligible employer status clarification for the 2021 credit (9.06) Recovery startup business overview (9.58) What is a severely financially distressed employer? (11.55) Potential legislative impacts to the ERC (13.27) AICPA resources Employee retention credit guidance and resources — The ERC is an important of the COVID-19 relief legislation for small businesses. This library provides the ins and outs of calculating this credit. AICPA Town Hall Series — Bi-monthly, high-impact news broadcast series that delivers the latest news, analysis, insights and practical guidance to accounting and finance professionals and responds to pressing issues facing the profession Challenges with contingency fees and the ERC — Explore the prospect of contingent fees for ERC work and how regulatory rules govern its usage with the AICPA’s April Walker and Ed Karl on this Tax Section Odyssey episode from June 2021. What to know about the 2021 ERC before April 30 — On this April 2021 Tax Section Odyssey episode, Jan Lewis, CPA, with Haddox Reid CPAs & Advisors, reviews the latest ERC guidance and important information to help your clients benefit from this credit. PPP and ERC in 2020 — This Tax Section Odyssey episode from March 2021 reviews the IRS Notice 2021-20 and highlights what you need to know about the interaction between the ERC and PPP. Breaking down the employee retention credit – This February 2021 Tax Section Odyssey episode contains a deep dive on the calculation of the ERC. Other resources FAQs: Employee Retention Credit under the CARES Act — IRS answers to frequently asked questions on the ERC Rev. Proc. 2021-33 provides a safe harbor that permits a taxpayer to exclude certain items from “gross receipts” under Sec. 448(c) and Sec. 6033, as applicable, solely for purposes of determining eligibility to claim the ERC Notices 2021-20 — Guidance for employers claiming the ERC for calendar quarters in 2020 IRS Notice 2021-23 — Guidance on the ERC under the CARES Act for the first and second calendar quarters of 2021 Notice 2021-49 — Guidance that amplifies Notices 2021-20 and 2021-23 by providing additional guidance on claiming the ERC in the third and fourth calendar quarters of 2021. Note: If your podcast app does not hyperlink to resources, visit https://taxodyssey.libsyn.com to access show notes with direct links. This episode is brought to you by the AICPA’s Tax Section, your home base to maintain your professional edge. To learn more about the Tax Section, check out aicpa.org/tax or sign up for a free web tour.

The ongoing COVID-19 pandemic has impacted both the personal and professional lives of CPAs and their clients. The legislative changes alone provided an incredible amount of complexity to sift through, but the trailing guidance thereafter has compounded the intricacy. Two of the most talked about pieces of enacted legislation is the Paycheck Protection Program (PPP) and the employee retention credit (ERC). While we have guidance on how to treat most aspects of these provisions, key questions remain. On this Tax Section Odyssey episode, April Walker, CPA, CGMA, Lead Manager — Tax Practice & Ethics, Association of International Certified Professional Accountants, representing AICPA & CIMA, and Cari Weston, MST, CPA, CGMA, Director — Tax Practice & Ethics, Association of International Certified Professional Accountants, representing AICPA & CIMA, discuss how to finalize client tax returns when we don’t yet have all the answers. What you’ll learn in this episode Initial thoughts on how to handle open, unclarified and unclear issues while trying to finalize extended tax returns (1.43) Professional responsibilities and the signing of tax returns (9.11) Example on how to handle the ambiguity of a shareholder and their spouse’s salaries as qualifying wages for the ERC. (19.43) What to do when the IRS releases guidance after a position is taken on a return (24.28) AICPA resources SBA PPP resources for CPAs – Tools and resources on the ever-evolving PPP AICPA Town Hall Series – Bi-monthly, high-impact news broadcast series that delivers the latest news, analysis, insights and practical guidance to accounting and finance professionals and respond to pressing issues facing the profession Treasury Department Circular No. 230 – Consolidated information on the rules governing the recognition of attorneys, CPAs, enrolled agents, enrolled retirement plan agents, registered tax return preparers and other persons representing taxpayers before the IRS Statement on Standards for Tax Services (SSTSs) – Toolkit for the enforceable tax practice standards for members of the AICPA Other resources Circular No. 230 Tax Professionals – IRS resource page with multiple links to information on Circular No. 230 and information from the Office of Professional Responsibility (OPR).   Note: If your podcast app does not hyperlink to resources, visit https://taxodyssey.libsyn.com to access show notes with direct links. This episode is brought to you by the AICPA’s Tax Section, your home base to maintain your professional edge. To learn more about the Tax Section, check out aicpa.org/tax or sign up for a free web tour.

Summer may be in full swing, but tax practitioners still need to be mindful of certain alerts and deadlines that might have gotten lost in the shuffle earlier this year. Annette Nellen, CPA, CGMA, Esq., Tax Professor – MST Program at San Jose State University, and a past Chair of the AICPA Tax Executive Committee, shares her summer hit list of items to be aware of including: Discussion on how to repay any deferred payroll taxes from 2020 Documentation needed for the employee retention credit (ERC) and other COVID-19 payroll tax credits Treatment of other COVID-19 relief including grants and debt cancellation programs What you’ll learn in this episode General overview of the deferred payroll taxes (1.20) How self-employed individual and household employers can repay deferred Social Security taxes (4.29) Accrual method employer treatment of the deferred payroll taxes (9.42) ERC and sick leave credit documentation requirements (11.22) Tax treatment of other COVID-19 relief (23.00) AICPA resources Employer retention credit guidance – Collection of resources and guidance on the latest with the ERC Other resources Use Tax Pro Account – Information on how to request Power of Attorney (POA) or Tax Information Authorization (TIA) online COVID Tax Tip 2021-96: How self-employed individuals and household employers repay deferred Social Security tax – Provides information on how these taxpayers can repay the deferred payroll taxes COVID Tax Tip 2021-99: Making payments for deferred tax reported by third party payers – Pointers on how to make payments for deferred payroll tax by third party payers   Note: If your podcast app does not hyperlink to resources, visit https://taxodyssey.libsyn.com to access show notes with direct links. This episode is brought to you by the AICPA’s Tax Section, your home base to maintain your professional edge. To learn more about the Tax Section, check out aicpa.org/tax or sign up for a free web tour.

The pressure to adapt business models to the present while simultaneously preparing for the future has always been a force acting upon professionals.    On this Tax Section Odyssey episode, April Walker, CPA, CGMA, Lead Manager — Association of International Certified Professional Accountants, representing AICPA & CIMA, and Donald A. Nelson, EA, Co-Founder — Pacesetter Tax, discuss current technology buzz words and what it takes to become modern firm in a sustainable model. What you’ll learn in this episode What the term “embrace the change” means (0.50) Evaluate your tech stack (3.08) The IRS tech stack (4.50) Key things to keep in mind when considering modifications to your tech stack (7.00) What a “modern firm” is (8.01) Ways to incorporate automation to facilitate efficiency (9.37) Steps firm leaders can take to help themselves and staff avoid burnout (14.58) Overview of Pacesetter Tax (17.39) AICPA resources Technology hub – Provides access to the latest technology information, tools and resources to best serve your clients or support the organization where you work. Tax Practice Quarterly: Managing a Tax Practice in the Modern World | Tax Section webcast archive – Webcast archive from May 19, 2021 that covers important issues such as how to expand your service offerings as a result of the pandemic, delve into the evolution of the virtual tax practice and explore best practices from a human resource and a client-service perspective Talking to clients about the advanced child tax credit before July | Tax Section Odyssey – This podcast, recorded in late June 2021, covers the latest news to date regarding the child tax credit advanced payments and the related online tools and portals. 2020 tax software survey – Journal of Accountancy article featuring the results of their annual tax software survey Other resources Pacesetter Tax – Integrated solution that allows tax preparation practices to work more efficiently and serve clients more effectively. Pacesetter Tax is designed to work seamlessly with whatever tax software your practice uses, from basic to top-of-the-line, and to replace the patchwork of other one-off tools that don’t play nicely together.   Note: If your podcast app does not hyperlink to resources, visit https://taxodyssey.libsyn.com to access show notes with direct links. This episode is brought to you by the AICPA’s Tax Section, your home base to maintain your professional edge. To learn more about the Tax Section, check out aicpa.org/tax or sign up for a free web tour.

On this Tax Section Odyssey episode, April Walker, CPA, CGMA, Lead Manager — Association of International Certified Professional Accountants, representing AICPA & CIMA, and Larry Pon, CPA/PFS, CFP, EA, USTCP, AEP — Pon & Associates, review the changes to the 2021 child tax credit (CTC) and discuss the latest news regarding the related advanced payments. The American Rescue Plan Act enacted in March 2021 temporarily expands the CTC amount for certain taxpayers, made the credit fully refundable (meaning taxpayers can receive it even if they don’t owe the IRS) and directs the IRS to make advance payments equal to 50% of IRS's estimate of the eligible taxpayer's 2021 CTCs during the period July 2021 through December 2021. In a letter currently being sent to taxpayers, the IRS explains that taxpayers will automatically receive advance CTC payments —assuming they are otherwise eligible to receive the CTC — for 2021. To date, the IRS has unveiled the following: Child Tax Credit Eligibility Assistant – allows families to answer a series of questions to determine whether they qualify for the advance payments Child Tax Credit Update Portal – allows families to verify their eligibility for the payments and gives them an option to unenroll from receiving the monthly payments Child Tax Credit Non-filer Sign-up Tool – allows families who are not required to file a tax return but who are otherwise eligible for the payments to report their qualifying children. What you’ll learn in this episode Changes to the CTC for 2021 (1.13) What we know about the advance payments (3.50) How qualifying children are defined for the advance CTC (5.29) What practitioners should be discussing with clients in the next few weeks and related financial planning tips (6.28) Scenarios in which practitioners should advise clients to opt out of receiving advance payments and what is involved in the opt-out process (9.33) Tips for billing clients for work in this area (14.41) The CTC in 2022 and beyond (16.50) AICPA resources Child Tax Credit Client Letter – Client letter template for tax practitioners to use to notify their clients about the child tax credit changes and encourage clients to contact their CPA for additional tax and financial planning guidance. Child tax credit: New portal for opting out of advance payments – The Tax Adviser article published June 22, 2021 detailing the latest about the new portal. Other resources Advance Child Tax Credit Payments in 2021 – The IRS dedicated site that houses information related to the advance CTC payments as well as the eligibility assistant, update portal and non-filer sign-up tool 2021 Child Tax Credit and Advance Child Tax Credit Payments Frequently Asked Questions – Consolidation of answers to frequently asked questions related to the CTC and the advanced payments, separated by topic Proc. 2021-24 – Procedures for individuals who are not otherwise required to file federal income tax returns for taxable year 2020 to receive advance child tax credit payments under Sec. 7527A. Note, if your podcast app does not hyperlink to resources, visit https://taxodyssey.libsyn.com to access show notes with direct links. This episode is brought to you by the AICPA's Tax Section, your home base to maintain your professional edge. To learn more about the Tax Section, check out aicpa.org/tax or sign up for a free web tour.