COVID-19

Tips for Taxpayers With Hobby Income

Hobby activities are a source of income for many taxpayers. As a reminder, this income must be reported on tax returns. But the reporting rules are different than for income from a for-profit business. For one thing, hobbyists can’t deduct their hobby expenses.

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Russo CPA Tax Tip Article Image: Mouse Trap snapped closed on U.S. dollar pile

Improperly Forgiven PPP Loans Are Taxable

Recipients of Paycheck Protection Loans (PPP) should be aware that when a taxpayer’s loan is forgiven based upon misrepresentations or omissions, they are not eligible to exclude the forgiveness from income. They must, instead, include in income the portion of the loan proceeds that were forgiven based upon misrepresentations or omissions.

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RUSSO CPA Tax Tips, how filing status affects your tax return 2022

Penalty Relief for Certain 2019 and 2020 Tax Returns

Penalty relief for struggling taxpayers affected by the COVID-19 pandemic is now available to most people and businesses who file certain 2019 or 2020 returns late. Eligible income tax returns must be filed on or before September 30, 2022, to qualify for this relief. Furthermore, the nearly 1.6 million taxpayers who have already paid these penalties will automatically receive more than $1.2 billion in refunds or credits. Many of these payments will be completed by the end of September.

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What is an Economic Impact Notice?

After a taxpayer has been issued an Economic Impact Payment, the IRS is required to mail an Economic Impact Notice to the recipient at their last known address. This notice provides information about the amount of the Economic Impact Payment, how it was made, and how to report any payment that wasn’t received.

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COVID-19: Significant Payroll and Self-Employment Tax Relief

If you are in business for yourself—say, as a corporation or self-employed—payroll taxes and self-employment taxes are likely two of your biggest tax burdens.

Due to the COVID-19 pandemic, individuals and businesses are suffering. Congress wants to help you individually and also keep small businesses afloat.

To do this, Congress decided that in addition to other measures, it should give you payroll tax and self-employment tax relief, as we describe in this article.

We’ll tell you how the Families First Coronavirus Response Act (FFCRA) and the Coronavirus Aid, Relief, and Economic Security (CARES) Act will give you payroll and self-employment tax relief.

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Are Taxes Two-Timing You? How to avoid dual-taxation…

The shift to remote working during the COVID-19 pandemic has been embraced by both employees and employers. This change will likely continue to varying degrees by many companies.

Although remote working offers great benefits, employees need to know about the possible tax consequences and how to navigate them.

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Self-Employed During the Pandemic? Washington Did Not Forget You

You report your business income as self-employed on Schedule C of your Form 1040 if you

  • receive 1099 income,
  • operate your business as a single-member LLC and did not elect corporate status,
  • operate a retail establishment or professional practice as a sole proprietor, or
  • report your W-2 income on a Schedule C because you are a statutory employee.

In the past, when times were bad, your government made no special effort to help you as a self-employed individual. For example, you had no “safety net” such as existed for employees who lost their jobs. You were just supposed to suck it up until things got better.

But this time, with COVID-19, it’s different.

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Coronavirus-Related Distributions and Loans

The Coronavirus, Aid, Relief, and Economic Security (CARES) Act made it easier to access savings in IRAs and workplace retirement plans for those affected by the coronavirus. This relief provided favorable tax treatment for certain withdrawals from retirement plans and IRAs, including expanded loan options.

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