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Archives for March 2020

COVID-19 Update 3.25.2020

The Treasury Department and Internal Revenue Service announced the federal income tax filing due date is automatically extended from April 15, 2020, to July 15, 2020.  We are continuing to work and complete as many tax returns as we can by the original filing date.  For any client that does not file by April 15, 2020, your returns will be automatically extended until July 15.  If you are unable to file by July 15, 2020, we can file an extension at that time to delay your filing until October 15, 2020. 

Taxpayers can defer federal income tax payments due on April 15, 2020, to July 15, 2020, without penalties and interest, regardless of the amount owed. This deferment applies to all taxpayers, including individuals, trusts and estates, corporations and other non-corporate tax filers as well as those who pay self-employment tax.  If we have completed your tax return and you owe money, you do not need to make the payment until July 15, 2020. This also applies to the first quarter 2020 estimated tax payments.  The deadline to contribute to an IRA or Roth IRA contribution for 2019, has also been extended until July 15, 2020. You will still have until the extended due date of your tax return to make SEP IRA and profit-sharing contributions.

South Carolina has adopted the federal changes.  North Carolina has also adopted the federal changes, with the exception of one item that requires a law change. The NCDOR does not have authority to waive interest charges on unpaid balances. We expect updates in the coming days.   If you file in a state other than NC or SC, we are monitoring the adoption of the federal changes.  Do not hesitate to email or call if you have any concerns. 

Our staff members are now working remotely.  Although accountants are considered an “essential service” under the Mecklenburg County Stay-at-Home proclamation, our office will only be open on a limited basis.  Please remember to make use of our portal for electronic transmission of documents.  If you are unable to use the portal, we will do our best to make arrangements to have your tax returns mailed to you or schedule an appointment for pick-up.    

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Treasury Secretary Announces 90-Day Payment Extension for Most Taxpayers

Following President Trump’s declaration of a national emergency, Treasury Secretary Steven Mnuchin stated at a press conference on March 17, 2020 that individuals can defer tax payments up to $1 million for 90 days. Corporations can defer up to $10 million of tax payments for 90 days.

The $1 million limit for individuals was established to cover small businesses and passthrough entities, he said.

“We encourage those Americans who can file their taxes to continue to file their taxes [by] April 15,” Mnuchin said, especially encouraging people who will be getting tax refunds to do so. “Just file your taxes,” he said, and “you will automatically not get charged interest and penalties” on payments made within the 90-day deferral period.

Observation: Mnuchin’s statement did not extend the tax filing due date. For individuals the filing date, generally, is April 15. But they can get an automatic extension to file till October 15 by, for example, filing Form 4868, Application for Automatic Extension of Time To File U.S. Individual Income Tax Return.

Observation: Many details remain unclear with respect to this relief, and no official written guidance has been released as of the time we went to press.

We’re aiming to keep you as up to date as possible. If you have any questions, please call us at (704) 372-1167.

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COVID 19 Letter 3.16.20

Dear Clients and Friends,

As the current situation surrounding the outbreak of the coronavirus (COVID-19) continues to evolve, please know that the health and well-being of our clients and staff is a top priority at Scharf Pera & Co., PLLC.  While our office will remain open, we encourage telephone conferences and e-mail communications over in-person meetings.  In addition to regular mail and overnight delivery options, we have a secure portal for electronic acceptance of documents and delivery of tax returns and financial statements.  Many of you are already making use of the portal, but if you do not have an account and would like one, please contact our office as soon as possible.  We hope all of these options will help protect the health of our clients and employees.

As always, we are committed to providing you with quality, timely and efficient service.  At this time, we have no updates on any changes to the April 15th tax deadline, but we will continue to monitor and update you. In the meantime, we will complete as many tax returns as we can accommodate.  As we have communicated in previous years, if you have not already submitted your documents by March 15th, we may have to file an extension for your tax returns.  We will update our website and Facebook page with future communications.

With these unusual circumstances, you may have questions about the tax extension process or other financial or accounting concerns.  We are available to assist you and respond to your questions as they arise. 

We wish you, your families and employees continued good health.

Scharf Pera & Co., PLLC

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