Valuation & Litigation Consulting, LLC

In memory of a true Gem in the legal community.

CMLAA's Joseph B. Jerome Memorial Scholarship Fund Cleveland-Marshall Law Alumni Association accepts, with thanks, charitable donations to the CMLAA's Joseph B. Jerome Memorial Scholarship Fund. 

The backlog of the IRS is astounding!
https://www.accountingtoday.com/news/irs-struggles-to-fill-jobs-deal-with-backlog-through-difficult-tax-season?position=editorial_1&campaignname=V2_ACT_IRSWatch_20210503-05122021&utm_source=newsletter&utm_medium=email&utm_campaign=V2_ACT_IRSWatch_20210503%2B%27-%27%2B05122021&bt_ee=SZnZDS%2BcIcz2tH%2FNh5OdfBUWxqpsHnzI7cHe%2F7YVcEWe9RkTaSZW2pxkIvhBeXUE&bt_ts=1620835289384

IRS struggles to fill jobs, deal with backlog through difficult tax season The Internal Revenue Service is having a hard time hiring enough staff to help it get through this year’s extended tax season and overcome its backlog of unprocessed tax returns.

I guess this is one way to pay for all these stimulus payouts.

Biden to Propose Capital Gains Tax Hike | Kiplinger The president is expected to include a capital gains tax increase for millionaires in his soon-to-be-released American Families Plan.

If you are waiting on an income tax refund from the IRS, plan on waiting a little longer.
https://www.accountingtoday.com/news/irs-sees-delays-in-tax-refunds-and-quarterly-payments?position=editorial_1&campaignname=ACT_Daily_Daily-04262021&utm_source=newsletter&utm_medium=email&utm_campaign=ACT_Daily_Daily%2B%27-%27%2B04262021&bt_ee=4O19uJftxjal%2BOCHdvsLFRTp0tF0t8ggsLVKV19EfYk6bF5V8RNXmp7oz5kBc4f2&bt_ts=1619431245002

IRS sees delays in tax refunds and quarterly payments The Internal Revenue Service is holding up millions of tax refunds for manual processing and its systems were unable to process many of the quarterly payments that needed to be sent by April 15.

Valuation & Litigation Consulting, LLC updated their business hours.

If you already filed your tax return reporting unemployment benefits, no need to amend your return. The IRS is going to automatically refund the taxes paid on the unemployment benefits.
https://www.accountingtoday.com/news/irs-plans-to-issue-tax-refunds-on-unemployment-benefits-in-may?position=editorial_1&campaignname=ACT_Tax_Pro_Today_master-04012021&utm_source=newsletter&utm_medium=email&utm_campaign=ACT_Tax_Pro_Today_master%2B%27-%27%2B04012021&bt_ee=4%2BZYJGaB0dyOpE4in%2F%2F3eQ0rz5D%2F85uEeacaLTjvr02PLi6YKO1fEwMbOodFuc7A&bt_user_id&bt_ts=1617292873954

IRS plans to issue unemployment refunds in May The service intends to take steps to automatically refund money starting in May and continuing through the summer.

Tax Day for individuals extended to May 17: Treasury, IRS extend filing and payment deadline

WASHINGTON — The Treasury Department and Internal Revenue Service announced today that the federal income tax filing due date for individuals for the 2020 tax year will be automatically extended from April 15, 2021, to May 17, 2021. The IRS will be providing formal guidance in the coming days.

“This continues to be a tough time for many people, and the IRS wants to continue to do everything possible to help taxpayers navigate the unusual circumstances related to the pandemic, while also working on important tax administration responsibilities,” said IRS Commissioner Chuck Rettig. “Even with the new deadline, we urge taxpayers to consider filing as soon as possible, especially those who are owed refunds. Filing electronically with direct deposit is the quickest way to get refunds, and it can help some taxpayers more quickly receive any remaining stimulus payments they may be entitled to.”

Individual taxpayers can also postpone federal income tax payments for the 2020 tax year due on April 15, 2021, to May 17, 2021, without penalties and interest, regardless of the amount owed. This postponement applies to individual taxpayers, including individuals who pay self-employment tax. Penalties, interest and additions to tax will begin to accrue on any remaining unpaid balances as of May 17, 2021. Individual taxpayers will automatically avoid interest and penalties on the taxes paid by May 17.

Individual taxpayers do not need to file any forms or call the IRS to qualify for this automatic federal tax filing and payment relief. Individual taxpayers who need additional time to file beyond the May 17 deadline can request a filing extension until Oct. 15 by filing Form 4868 through their tax professional, tax software or using the Free File link on IRS.gov. Filing Form 4868 gives taxpayers until Oct. 15 to file their 2020 tax return but does not grant an extension of time to pay taxes due. Taxpayers should pay their federal income tax due by May 17, 2021, to avoid interest and penalties.

The IRS urges taxpayers who are due a refund to file as soon as possible. Most tax refunds associated with e-filed returns are issued within 21 days.

This relief does not apply to estimated tax payments that are due on April 15, 2021. These payments are still due on April 15. Taxes must be paid as taxpayers earn or receive income during the year, either through withholding or estimated tax payments. In general, estimated tax payments are made quarterly to the IRS by people whose income isn't subject to income tax withholding, including self-employment income, interest, dividends, alimony or rental income. Most taxpayers automatically have their taxes withheld from their paychecks and submitted to the IRS by their employer.

State tax returns

The federal tax filing deadline postponement to May 17, 2021, only applies to individual federal income returns and tax (including tax on self-employment income) payments otherwise due April 15, 2021, not state tax payments or deposits or payments of any other type of federal tax. Taxpayers also will need to file income tax returns in 42 states plus the District of Columbia. State filing and payment deadlines vary and are not always the same as the federal filing deadline. The IRS urges taxpayers to check with their state tax agencies for those details.

Join us on April 7th...

New Valuation Webinar Premiering April 7, 2021 - Financial Poise This webinar explores the key factors you should consider in choosing your valuation expert.

Next up on stimulus...

Who Is Eligible for the Third Round of Stimulus Checks? Eligibility criteria for who gets a stimulus check in the third round of payments changed from the first two rounds. These are the major differences.

If you are like me, you've been waiting for the vaccine to be fully rolled out before traveling by air. When you are ready to fly, you will see a lot of changes going through security. Safe Travels!

TSA Announces New Airport Screening Procedures From scanning your own boarding pass to practicing physical distancing, here are 8 new policies to follow the next time you fly.


They wasted no time...

IRS and Treasury start depositing stimulus payments The initial direct deposits of the second round of economic impact payments are already going out to taxpayers.

Good new for PPP forgiveness. Early on the IRS issued regulations stating that any expenses PPP funds were used for would not be tax deductible, even though this was not the intent of Congress. This was fixed this week. Read on.

PPP And EIDL Loan Advances And Changes Under New Act Hundreds of thousands of small businesses and millions of people have been waiting for a second round of Paycheck Protection Program (“PPP”) loans to keep businesses and professionals operational.

With so much speculation, I thought this was a good article to share.

The Truth Behind Common COVID-19 Vaccine Misconceptions As coronavirus vaccines near approval and release, false information is spreading. Here are some prevalent myths and the truth behind these medicines.

Wow, a mother was thrown in jail for having her high risk child tested for Covid.

The Family Court Judge Who Threatened a Mother With Contempt of Court for Getting Her Child a COVID-19 Test Ohio juvenile court Judge Timothy Grendell thought coronavirus precautions were overblown, and made sure people knew it. In one case he forbade a mother from getting her children tested for COVID-19. Then, one of them had to go to the emergency room.

A wonderful break from the current struggles in our professional and personal lives. This is a wonderful documentary of the animals living in Finland providing an excellent education, beautiful videography, and exceptional commentary. I highly recommend...and the bigger the screen the better.

Nature | Santa's Wild Home | Season 39 | Episode 6 Journey to Lapland, where tales of Santa Claus mingle with hearty wildlife.

Cuyahoga County is continuing to help its hardest hit small businesses. Applications for this 3rd round of grants will be accepted beginning Monday November 23rd.

Small Business Stabilization Fund The Small Business Stabilization Fund brings together partners from across Cuyahoga County to support small businesses during the crisis. The program offers two types of financial assistance for small businesses: Stabilization Grants and Stabilization Loans. The third round of funding will provide u...

Do you know...that one in five small businesses closed in 2020?

"Small businesses are the engine of the economy,” said Ahu Yildirmaz, co-head of the ADP Research Institute, a think tank affiliated with the payroll processor ADP. “In past recessions, they were the ones really fueling the economy.’’ Roughly one in five small businesses has closed, according to the data firm Womply. [1]

Not all businesses have been affected in the same way. Restaurants, bars, beauty shops, and other retailers that involve face-to-face contact have been hardest hit as consumers practice social distancing.

In a survey of small businesses conducted September 27 to October 3, 2020, the U.S. Census Bureau found that 21.6% of businesses expected to need financial assistance or additional capital in the next six months. About 44% expected it would take more than six months to return to a normal level of operations relative to a year ago. Only 27.8% said they had cash on hand available to cover three or more months of operations. [2]

Small business valuations make up the majority of engagements for many firms. Valuation analysts are grappling with the implications on value of the COVID-19 pandemic. It is important to understand the risk factors for small businesses and how they differ from large companies and to answer key questions such as whether COVID-19 was a factor at the valuation date, what disclosures about COVID-19 may be required in a valuation report, and how government assistance programs may impact value. It is also the case that the economic and industry analysis that is part of every valuation will be more detailed for valuation dates in 2020.

The pandemic recession has hit the small business sector hard. Be sure that you understand the implications for 2020 valuations.

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[1] Associated Press, "Pandemic hammers small business vital to economic recovery," October 14, 2020.
[2] U.S. Census Bureau, Small Business Pulse Survey, September 27-October 3, 2020.

Interesting read on which countries have the highest corporate tax rates and why.

The Highest Corporation Taxes Around the World and the Main Drivers Behind Them While corporation tax rates are influenced by the country’s definition, there’s clearly a pattern with developing countries and emerging economies paying higher rates to sustain the country.

The IRS has another new form. They are breaking out some of the payment purposes originally on 1099-MISC and now requiring it to be reported on the all new 1099-NEC. And the new 1099-NEC must be filed by January 31st, unlike the March 31st deadline for the 1099-MISC.

IRS Launches New Form Replacing 1099-MISC for Contractors in 2020 For years, businesses used Form 1099-MISC to report calendar-year payments exceeding $600 to individuals who performed business services. These include vendors, independent contractors, freelancers, and consultants.

So sad to see this happen. Be sure to read the great history of this facility in the article.

Here Today, Not Gonna Stay: I-X Center to Close After 35 Years Cleveland's International Exposition (I-X) Center announced Wednesday that it would close at the end of the year after 35 years of operation due to Covid-19....

This article provides a very good explanation of the new allowance to defer employee payroll taxes. There are significant risks involved, which is why I do NOT recommend deferring.

Employee payroll tax deferral guidance creates risk IRS guidance implementing a White House directive to defer certain employee payroll taxes the guidance raises more questions than it answers.

Did you have a tax refund? Better yet, did the IRS give you interest on that refund. If so, it is taxable.

Millions of taxpayers receive a tax refund interest payment | Internal Revenue Service COVID Tax Tip 2020-111, August 31, 2020

Did you ever wonder how the social security payment increases are calculated?

2021 COLA: A Raise Likely for Social Security Recipients After All | Kiplinger Fear of a flat COLA? Relax, looks like an increase is coming for 2021 Social Security checks.

The IRS is still working on fixing their errors when they rushed to get the stimulus payments out. Got this from the IRS today:

IRS: 50,000 spouses to get catch-up Economic Impact Payments

WASHINGTON – The Internal Revenue Service will soon send catch-up Economic Impact Payment checks to about 50,000 individuals whose portion of the EIP was diverted to pay their spouse’s past-due child support.

These catch-up payments are due to be issued in early-to-mid-September. They will be mailed as checks to any eligible spouse who submitted Form 8379, Injured Spouse Allocation, along with their 2019 federal income tax return, or in some cases, their 2018 return. These spouses do not need to take any action to get their money. The IRS will automatically issue the portion of the EIP that was applied to the other spouse's debt.

The IRS is aware that some individuals did not file a Form 8379, Injured Spouse Allocation, and did not receive their portion of the EIP for the same reason above. These individuals also do not need to take any action and do not need to submit a Form 8379. The IRS does not yet have a timeframe but will automatically issue the portion of the EIP that was applied to the other spouse’s debt at a later date.

Affected taxpayers can check the status of their Payment by using the Get My Payment tool, available only on IRS.gov.

For more information, see the Receiving My Payment section of the Frequently Asked Questions in the Economic Payment Information Center on IRS.gov.

Interesting article about how long it may take for various industries to recover from this pandemic. Be patient because it will be a while. https://www.mckinsey.com/industries/public-and-social-sector/our-insights/us-small-business-recovery-after-the-covid-19-crisis #

US small-business recovery after the COVID-19 crisis Improving operations and adapting business models can help small businesses in many industries recover. Finding the cash to do so may be a stretch.