2016 Tax Return: File Now or Forever Hold Your Peace...
Taxpayers who haven't filed 2016 will be leaving their cut of the $1.5 billion on the table if they don't file before this year's deadline.
Remote work: something that many call the way of the future, but what implications come with it? According to Accounting Today, 4% of employees residing in New York, Philadelphia, Portland, St. Louis, and Washington DC all live and work in different states.
While 4% may not seem to be that much, recognize that it actually breaks down to tens of thousands of people. With COVID pushing people more remotely, likely increasing that 4% figure stated above on a national scale, what might that do for their tax situations?
Accountants who work in state and local taxes, otherwise known as “SALT,” typically ensure their clients or businesses fulfill their respective obligations and are not overpaying taxes. Tax planning strategies are often created to reduce their client’s or businesses’ tax burden to the absolute minimum. But when employees suddenly empty their offices and set up offices at home, as they have due to COVID-19 concerns, a wrench can be thrown into that tax planning.
From here, businesses seem to have two options:
They can evaluate everything at tax time, potentially taking on penalties and overpaying tax.
They can take stock of their remote employee headcount and try to be proactive to minimize their tax burden.
Overall, the best way to handle this new world we are living in is to be proactive. I know all of this is a lot to think about to avoid being shocked in the future, but unfortunately, with the future still uncertain, it’s best to take decisive action now.
With the states desperate to make up for 2020 income shortfalls, your business may face unanticipated tax-related expenses this year. With correct planning, the effects of these and any other issues arising from COVID-19 on your business can be minimized.
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