Blog: On The Plus Side


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On the Plus Side

Parms + Company Blog

The Parms blog shares our insights about trending and time-tested topics that are important to our clients and the profession.

AICPA & CIMA Issue New Nonauthoritative Guidance for Auditing Digital Assets

AICPA & CIMA issued nonauthoritative guidance for auditing digital assets such as cryptoassets in the areas of risk assessment, processes and controls, laws and regulations, and related parties. The guidance was added to the free practice aid Accounting for and Auditing of Digital Assets. The AICPA created the practice aid in December 2019 with nonauthoritative guidance on accounting for digital assets and then added nonauthoritative guidance on auditing digital assets in July 2020. The update released Tuesday complements the previously released guidance and is based on professional literature and experience from members of the AICPA & CIMA Digital Assets Working Group (DAWG) and AICPA & CIMA staff and is specific to the U.S. generally accepted auditing standards (GAAS). “There are challenges and unique considerations when auditing an entity that holds or transacts with digital assets,” said Diana Krupica, CPA, AICPA & CIMA lead manager–Emerging Assurance Technologies, in a news release. “From performing risk assessment procedures and understanding new processes and controls to identify related parties, it is important for auditors to look through the lens of digital [...]

May 3rd, 2021|Categories: Audit, News|Tags: , , , , |0 Comments

2020 Recovery Rebate Credit

The first two rounds of Economic Impact Payments were advance payments of the 2020 Recovery Rebate Credit. Most eligible people already received the payments and won't include this information on their 2020 tax return. Who May Be Eligible to Claim the 2020 Recovery Rebate Credit? If you didn't get a first and second Economic Impact Payment or got less than the full amounts, you may be eligible to claim the 2020 Recovery Rebate Credit and must file a 2020 tax return even if you don't usually file a tax return. Claiming the Credit To claim the 2020 Recovery Rebate Credit, you must file a 2020 tax return, even if you aren't required to file. You must also know the amount of any first and second Economic Impact Payment you received. Filing a 2020 Tax Return File electronically and the tax software will help you figure your 2020 Recovery Rebate Credit. Get details on electronic filing options:  IRS Free File Program and Free File Fillable Forms – Prepare and file your federal taxes online for free. Free Volunteer [...]

April 19th, 2021|Categories: Tax|Tags: , , , , , |0 Comments

The IRS extended the federal tax deadline. Here’s when state returns are due

The tax season might be a little more complicated for filers in certain states. The recent move by the IRS to extend the filing season to May 17 from April 15 only applies to federal income tax returns. That deadline doesn’t always align with due dates for state income taxes. Most states have followed the IRS and moved the deadline for income tax returns to May 17. But a handful of states still have different deadlines that impact millions of taxpayers. Hawaii, Iowa, Maryland, and Oklahoma have state income tax deadlines that differ from the May 17 federal filing date. And, the deadline in Arizona could soon change. Taxpayers in Hawaii have less time to prepare and file their state returns -- the state deadline is April 30. In 2019, there were 1.1 million taxpayers in Hawaii, according to IRS data. Others don’t have to file their state taxes until after the federal deadline. Maryland’s state Tax Day is July 15, and Oklahoma’s is June 15. That’s good news for Maryland’s nearly 5 [...]

April 5th, 2021|Categories: News, Tax|Tags: , , |0 Comments

IRS Warns Taxpayers of “Ghost” Return Preparers

The IRS has reminded taxpayers to avoid "ghost" tax return preparers whose refusal to sign returns can cause an array of problems. Filing a valid and accurate tax return is important because the taxpayer is ultimately responsible for it. Ghost preparers get their name because they do not sign tax returns they prepare. Like a ghost, they try to be invisible to the fact that they have prepared the return and will print the return and get the taxpayer to sign and mail it. Similarly, for e-filed returns, the ghost preparer will prepare but refuse to digitally sign it as the paid preparer. By law, anyone who is paid to prepare or assist in the preparation of a federal tax return must have a valid Preparer Tax Identification Number or PTIN. Accordingly, paid preparers must sign and include their PTIN on the return. Not signing a return is a red flag that the paid preparer may be looking to make a fast buck by promising a big refund or charging fees based [...]

March 22nd, 2021|Categories: Tax|Tags: , , , |0 Comments

Educators Can Now Deduct out-of-pocket Expenses for COVID-19 Protective Items

Eligible educators can deduct unreimbursed expenses for COVID-19 protective items to stop the spread of COVID-19 in the classroom. COVID-19 protective items include, but are not limited to:   *   Face masks   *   Disinfectant for use against COVID-19   *   Hand soap   *   Hand sanitizer   *   Disposable gloves   *   Tape, paint or chalk to guide social distancing   *   Physical barriers (for example, clear plexiglass)   *   Air purifiers   *   Other items recommended the Centers for Disease Control and Prevention recommends that individuals use for the prevention of the spread of COVID-19 Rev. Proc. 2021-15 PDF, issued today, provides guidance related to educators and their expenses under the COVID-related Tax Relief Act of 2020, which was enacted as part of the Consolidated Appropriations Act, 2021. The new law clarifies that unreimbursed expenses paid or incurred after March 12, 2020, by eligible educators for protective items to stop the spread of COVID-19 qualify for the educator expense deduction. The educator expense deduction rules permit eligible educators to deduct up to $250 of qualifying expenses per year ($500 if married [...]

March 8th, 2021|Categories: Tax|Tags: , , |0 Comments

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