Here you will find news and updates on items we found interesting and useful. This page will continue to grow as the regulations and laws change. For more information, contact us!
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Hello to all of our business clients,
As we navigate these uncharted waters of living with COVID19, the uncertainty of how the current CARES Act and future legislation will be treated does not allow us to give you a final set of answers regarding assistance programs. However, we have included links in this text to help keep you up to date. The Treasury website listed here: https://home.treasury.gov/policy-issues/cares/assistance-for-small-businesses provides some useful links that go over each of the loan programs and what is required to support them. The SBA website for small businesses also provides an updated list of options available for all of us small businesses https://www.sba.gov/page/coronavirus-covid-19-small-business-guidance-loan-resources.
The best place to start is to continue to keep diligent and accurate records and copies of any paperwork and applications. We also encourage you to reach out to your support network, the bank you work with, your financial advisors and of course your accountant with any questions and concerns you have. Our office is working to keep up to date with the latest news and information and will do our best to advise you of any information we think pertains to your situation.
We at Bapple & Bapple, Inc. thank you for your business and hope you are staying safe and healthy!
Below you will find the W-4's, WH-4's (for Indiana employers), IL-W-4's (for Illinois employers), NC-4's (for North Carolina Employers), and I-9's. Print copies of the attached forms and have all new employees fill out the W-4 and the appropriate state form. We will need copies of these forms for our files as soon as possible. Please note that North Carolina employees may fill the NC-4.
All new employees must also fill in the I-9 form and we will need a copy of this form for our files. The I-9 form needs to be completed by the employee and the employer. The instructions that come with this form give you the guidelines to follow. Please make sure the employees have filled this form out completely and that you have verified their identification against the form.
If these forms have not been filled out completely or information has changed, a new form needs to be completed. Please feel free to call us if you have any questions.
Please click on the icon below to download/view the 2020 Indiana County Tax Rates.
IR-2019-215, December 31, 2019
WASHINGTON — The Internal Revenue Service today issued the 2020 optional standard mileage rates (PDF) used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.
Beginning on January 1, 2020, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:
The business mileage rate decreased one half of a cent for business travel driven and three cents for medical and certain moving expense from the rates for 2019. The charitable rate is set by statute and remains unchanged.
It is important to note that under the Tax Cuts and Jobs Act, taxpayers cannot claim a miscellaneous itemized deduction for unreimbursed employee travel expenses. Taxpayers also cannot claim a deduction for moving expenses, except members of the Armed Forces on active duty moving under orders to a permanent change of station. For more details, see Rev. Proc. 2019-46 (PDF).
Webpage Location: https://www.irs.gov/newsroom/irs-issues-standard-mileage-rates-for-2020
Below, you'll find a download for the Schedule C form. Click the icon to open the document.
The IRS has issued final regulations regarding whether or when taxpayers must capitalize expenses related to the acquisition, production, or improvements of tangible assets. These regulations are effective as of January 1, 2014. The regulations include clarification of the following items: materials and supplies, repairs and maintenance, and amounts paid to acquire, produce, or improve tangible property.
Materials and supplies
Materials and supplies are generally defined as tangible property that are used or consumed in operations, are not classified as inventory, and that either have a cost of $200 or less or a useful life of 12 months or less. Items determined to be materials and supplies are deductible in the year paid. A taxpayer may elect to substitute their own capitalization threshold on an annual basis. This election is called the de minimis election. In order to make the election the taxpayer will need to have a capitalization policy in place for the year stating their threshold amount. The maximum threshold is $500 per invoice for taxpayers who do not have an audited financial statement. A taxpayer with an audited financial statement may choose to expense materials and supplies up to a maximum threshold of $5,000 per invoice.
On the other side, taxpayers may choose to elect to capitalize the costs of rotable spare parts, temporary spare parts, or stand-by emergency spare parts. The election to capitalize must be made on a timely filed tax return, including extensions, for the year the part is placed in service. The election is revocable only through a favorable private Letter Ruling from the IRS.
Repairs and maintenance
The general rule for routine maintenance is that the cost may be expensed and does not need to be capitalized. The regulations include a routine maintenance safe harbor rule that states than an amount paid may be deducted if it is for recurring activities performed to keep a unit of property in efficient operating condition. An activity is deemed routine if the taxpayer reasonably expects to perform the activity more than once during the class life of the property.
In terms of maintenance for buildings, the activity will only be deemed routine if the taxpayer reasonably expects to perform said activity more than once during a 10 year period beginning when the structure is placed in service.
For maintenance of property other than buildings, the activities are expected to be performed at any time during the useful life of the property. Examples of routine maintenance include the inspection, cleaning, or testing of the structure or building system and replacement of worn or damaged parts.
Taxpayers may elect to capitalize repairs and maintenance on an annual basis by attaching a statement to a timely filed Federal tax return.
Amounts paid to acquire or produce property
In general, taxpayers must capitalize amounts paid to acquire or produce a unit of real or personal property, which include leasehold improvements, buildings, machinery, equipment, furniture, fixtures, land, and land improvements. Costs paid to facilitate the acquisition of the property and costs for work performed prior to the date the property is placed in service also must be capitalized. Basically, any amount paid towards purchasing a piece of property that you ultimately do acquire must be included in the basis of the property and, therefore, be capitalized.
Amounts paid to improve a unit of property
In general, taxpayers must capitalize amounts paid for improvements made to a unit of property that they own. Improvements include betterments to the property, restoration of the property, and adaptation of the property to a new or different use. A unit of property includes all components that are functionally interdependent, which means that one component placed in service is dependent on the placing in service of another component. The regulations have established special rules for buildings, leased property, plant property, and improvements. Any improvements you make will be studied on a case by case basis to see if these special rules apply.
Implementing the rules
While most of the safe harbor rules and elections are implemented by filing a statement of treatment with a timely filed Federal tax return, some items are considered to be changes in accounting methods. In these cases, the taxpayer will need to file Form 3115, Application for Change in Accounting Method. For example, taxpayers who wish to implement the de minimis rules for materials and supplies will file an election statement with their Federal tax return. A taxpayer who wishes to adopt the spare parts provision of the materials and supplies regulation will need to file Form 3115.
The new regulations will have some effect on all taxpayers who own tangible property. We will assess each taxpayers situation as we are working on their information. If you have any questions, please call us at (219)662-2727.
IR-2018-251, December 14, 2018
WASHINGTON — The Internal Revenue Service today issued the 2019 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.
Beginning on Jan. 1, 2019, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:
The business mileage rate increased 3.5 cents for business travel driven and 2 cents for medical and certain moving expense from the rates for 2018. The charitable rate is set by statute and remains unchanged.
It is important to note that under the Tax Cuts and Jobs Act, taxpayers cannot claim a miscellaneous itemized deduction for unreimbursed employee travel expenses. Taxpayers also cannot claim a deduction for moving expenses, except members of the Armed Forces on active duty moving under orders to a permanent change of station. For more details see Notice-2019-02.
The standard mileage rate for business use is based on an annual study of the fixed and variable costs of operating an automobile. The rate for medical and moving purposes is based on the variable costs.
Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.
A taxpayer may not use the business standard mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or after claiming a Section 179 deduction for that vehicle. In addition, the business standard mileage rate cannot be used for more than four vehicles used simultaneously. These and other limitations are described in section 4.05 of Rev. Proc. 2010-51.
Notice 2019-02, posted today on IRS.gov, contains the standard mileage rates, the amount a taxpayer must use in calculating reductions to basis for depreciation taken under the business standard mileage rate, and the maximum standard automobile cost that a taxpayer may use in computing the allowance under a fixed and variable rate plan.
Please click on the icon below to download/view the 2019 Indiana County Tax Rate Changes.