Translations from Your Trusted Advisor.
Back in July we posted an update about several New Hampshire Tax updates and changes, most stemming from the passing of NH’s biennial budget. Last week the Governor signed Senate Bill 101 which will impact the NH Business Profits Tax (BPT).
Last week the IRS updated the frequently asked questions (FAQs) on the paid sick and family leave tax credits under the American Rescue Plan Act of 2021.The new updates now include information regarding COVID-19 immunizations.
Mallory Vincent, MBA •
Have you maximized your potential tax benefits under the child and dependent care credit? The American Rescue Plan Act made several changes to the child and dependent care credit for the 2021 tax year including making this credit refundable for people who live in the United States for more than half the year. This means that you could get the full credit amount for 2021 and even generate a tax refund if you pay childcare expense for your children under age 13. This credit also covers expenses for the care of other people, including a spouse who was physically or mentally incapable of self-care and lived with you for more than have the year. Another example is someone who was physically or mentally incapable of self-care, lived with you for more than half the year, and either (1) was your dependent, or (2) could have been your dependent except that he or she received gross income of $4,300 or more, he or she filed a joint tax return, or you (or your spouse, if filing jointly) could have been claimed as a dependent on another person’s tax return.
Eric Kipperman •
The Advance Child Tax Credit Payment is a useful tool to allow early access to this credit that you normally would only receive when you file your return. Receiving these payments can be helpful to free up some cash to make things a bit easier now, after dealing with all of the financial hardships associated with the COVID-19 pandemic. For some, opting out of the payments makes more sense. If you rely on the Child Tax Credit to meet your tax obligation then you would want to opt out of the Advanced Child Tax Credit Payment as this will reduce the amount of credit available to claim on your 2021 tax return.
Both business owners and individuals who file taxes in the state of New Hampshire have some changes that may affect them for upcoming tax years, particularly 2022. As a result of some recent budget changes and legislation, all Granite State taxpayers can expect some aspect of these recent changes to affect them.
Last week legislation was finalized in the State of New Hampshire allowing for Payroll Protection Program (PPP) Loan forgiveness to conform to the federal treatment. This will allow any forgiven funds to be nontaxable.
Dana R. Bull, CPA, MST •
The Department of the Treasury recently issued detailed information regarding the Biden Administration’s budget and tax proposals for fiscal year 2022. This annual publication is known as “the Green Book.” This publication gives a clear picture of tax policies being pursued by the current administration. Many of these proposals have been previously announced in the “Made in America Plan” and “American Jobs Plan.” Keep in mind that these are only proposals and not newly passed tax law. While there are too many proposals to address in this blog, here are some of the highlights that are likely to affect a number of taxpayers:
The SBA has officially set the opening days for the Restaurant Revitalization Fund which is a $28.6 billion program that will provide grants to restaurants impacted by the pandemic.
Lena Rozzi, CPA •
NH Charitable Trusts Unit
Nonprofit organizations serve a broad range of industries and are a vital part of New Hampshire by fostering civic engagement, driving economic growth, and encouraging public interests within our communities. The mission of the NH Charitable Trusts Unit is to protect the public’s interest in the organizations and assets committed to charitable purposes in New Hampshire. As a nonprofit organization registered with the NH Charitable Trusts Unit, there are annual filing requirements that are necessary in order to remain in good standing with the NH Charitable Trusts Unit.
For 2021 and 2022 calendar year periods the 50% meals deduction has been increased to 100% when relating to food or beverages purchased through a “restaurant”. Previously the definition of a restaurant was unclear so the IRS has issued guidance.
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