Senator From California Sponsors Bill To Give Unemployment Checks To Illegal Immigrants, Paid By California Taxpayers

Senator From California Sponsors Bill To Give $300 Unemployment Checks To Illegal Immigrants, Paid For By California Taxpayers

According to an article in American Military News, that has mostly escaped national attention, the California Senate took a controversial step earlier this year toward providing massive unemployment benefits to illegal immigrants. The Bill was sponsored by California Senator Maria Durazo with the burden to be on California taxpayers.

In May, the California Senate voted to provide $300 weekly checks to unemployed illegal immigrants, according to The Free Beacon. The decision comes at a time when the state is grappling with a $31.5 billion deficit and heightened concerns about mass illegal immigration.

The Democratic state senators led by Sen. María Elena Durazo passed Senate Bill 227 with a 30-7 vote, sending the legislation to the Assembly for further deliberation. The proposed law aims to provide undocumented workers up to 20 weeks of $300 weekly unemployment checks, contingent on meeting minimal work requirements.

According to The Free Beacon, critics have pointed out that the unemployment insurance fund slated to administer these payments is already mired in $31 billion of fraud losses related to the COVID-19 pandemic. Additionally, California employers, who are burdened with the fund’s $20 billion debt, face the prospect of increased payroll taxes, which is a point of contention for small businesses and restaurants, as both sectors have already been strained by stringent COVID-19.

The proposed law has a unique stipulation, as it would prohibit fund officials from asking claimants for their social security number eligibility or from verifying their employment status with past or current employers. Applicants would self-certify their qualifications using documentation such as tax returns or payment app logs.

The legislative development comes shortly after California’s Democrat Gov. Gavin Newsom expressed concerns that the rising influx of undocumented migrants could “break” California.

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2024 Corporate Transparency Act: Navigating New Compliance

2024 Corporate Transparency Act: Navigating New Compliance

In an ever-evolving business world, staying informed about legislative changes is not just advantageous – it’s essential. The Corporate Transparency Act (CTA), set to take effect in 2024, is a pivotal development that promises to reshape how businesses report and operate.

Understanding the Corporate Transparency Act: The CTA aims to crack down on illicit activities by enhancing transparency in business ownership. For many businesses, particularly LLCs and corporations, this means a new set of reporting requirements. The Act requires the disclosure of beneficial owners – individuals with significant control or ownership interest – to the Financial Crimes Enforcement Network (FinCEN).

Who Will Be Affected: It’s crucial for businesses to understand whether they fall under the purview of this Act. Most private corporations and LLCs will need to comply, while some entities, like publicly traded companies, may be exempt.

The Importance of Compliance: Non-compliance with the CTA can result in severe penalties. It’s not just about avoiding fines; it’s about cultivating a business environment rooted in transparency and trust. Accurate reporting under the CTA will be essential in maintaining good standing with regulatory bodies.

How to Prepare Your Business: The first step is understanding your obligations under the CTA. Assess your current ownership structure and determine if and what you need to report. Implementing robust internal systems for record-keeping can streamline this process, ensuring you’re always ready for compliance checks.

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Tax Credits And Deductions For Individuals

Tax Credits And Deductions For Individuals

Tax credits and deductions change the amount of a person’s tax bill or refund. People should understand which credits and deductions they can claim and the records they need to show their eligibility.

Tax Credits

A tax credit reduces the income tax bill dollar-for-dollar that a taxpayer owes based on their tax return.

Some tax credits, such as the Earned Income Tax Credit, are refundable. If a person’s tax bill is less than the amount of a refundable credit, they can get the difference back in their refund.

To claim a tax credit, people should:

  • Keep records to show their eligibility for the tax credits they claim.
  • Check now to see if they qualify to claim any credits next year on their tax return.
Deductions

Deductions can reduce the amount of a taxpayer’s income before they calculate the tax they owe.

Most people take the standard deduction. The standard deduction changes each year for inflation. The amount of the standard deduction depends on a taxpayer’s filing status, age and whether they’re blind and whether the taxpayer is claimed as a dependent by someone else.

Some people must itemize their deductions, and some people may choose to do so because it reduces their taxable income more than the standard deduction. Generally, if a taxpayer’s itemized deductions are larger than their standard deduction, it makes sense for them to itemize.

Interactive Tax Assistant

Find help with tax questions based on specific circumstances with the Interactive Tax Assistant. It can help a person decide if they’re eligible for many popular tax credits and deductions.

IRS Tax Tip 2024-01

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How Small Business Owners Can Deduct Their Home Office From Their Taxes

How Small Business Owners Can Deduct Their Home Office From Their Taxes

If you are a W-2 worker — meaning your employer withholds taxes from your paychecks — you can’t take the home office deduction for 2023. However, freelance and contract workers with income reported via 1099-NEC may qualify. Your home office must meet specific guidelines to qualify for the deduction,.

The home office deduction allows qualified taxpayers to deduct certain home expenses when they file taxes. To claim the home office deduction on their 2021 tax return, taxpayers generally must exclusively and regularly use part of their home or a separate structure on their property as their primary place of business.

Here are some details about this deduction to help taxpayers determine if they can claim it:
  • Employees are not eligible to claim the home office deduction.
  • The home office deduction, calculated on Form 8829, is available to both homeowners and renters.
  • There are certain expenses taxpayers can deduct. These may include mortgage interest, insurance, utilities, repairs, maintenance, depreciation and rent.
  • Taxpayers must meet specific requirements to claim home expenses as a deduction. Even then, the deductible amount of these types of expenses may be limited.
  • The term “home” for purposes of this deduction:
    • Includes a house, apartment, condominium, mobile home, boat or similar property.
    • Also includes structures on the property. These are places like an unattached garage, studio, barn or greenhouse.
    • Doesn’t include any part of the taxpayer’s property used exclusively as a hotel, motel, inn or similar business.
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Preparing For A Sales Tax Voluntary Disclosure Program: Best Practices And Strategies

Preparing For A Sales Tax Voluntary Disclosure Program: Best Practices And Strategies

Voluntary disclosure programs stand as important points of resolution for businesses navigating potential sales tax and state income tax non-compliance issues. Understanding the nuances of these programs is crucial for enterprises seeking to rectify their tax affairs. In this article we’ll focus on voluntary disclosure agreements (known as “VDAs” in the state tax arena) as they relate mostly to sales tax and state income tax.  Note that each state has its own process for engaging in these remedies and there is no “one-size fits all” although there are similarities among the programs.

We’ll cover some of those nuances here:

1. Understanding Voluntary Disclosure Programs:

2. Risks of Non-Compliance:

  • Overview:
    Explore risks related to non-compliance, emphasizing proactive mitigation.
  • 1. Audits and Investigations:
    Non-compliance increases the risk of time-consuming audits as happens when a state identifies a company as non-compliant before the company is able to come forward voluntarily
  • 2. Financial Penalties:
    Non-compliance leads to financial penalties and interest.
  • 3. Legal Actions:
    Non-compliance may escalate to legal actions.
  • 4. Reputational Damage:
    Non-compliance can harm a business’s reputation.
  • 5. Loss of Business Opportunities:
    Non-compliance limits opportunities.
  • 6. Unpredictable Financial Impact:
    The financial impact of non-compliance is unpredictable.

3. Benefits of Participation:

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Five States With The Highest Average Combined State And Local Sales Tax Rates – Five States With The Lowest

Highest State Tax Rates- Lowest State Tax Rates

We always enjoy the outstanding research conducted by the Tax Foundation. We wanted to know the states with the highest state and local and sales and use tax rates. Before you start packing up all your personal belongings and move to another lower tax state, it is a good idea to do your research first. According to the research conducted by the Tax Foundation, the five states with the highest average combined state and local sales tax rates are Louisiana (9.56 percent), Tennessee (9.55 percent), Arkansas (9.45 percent), Washington (9.38 percent), and Alabama (9.29 percent). The five states with the lowest average combined rates are Alaska (1.82 percent), Hawaii (4.50 percent), Wyoming (5.44 percent), Maine (5.50 percent), and Wisconsin (5.70 percent). Five states forego statewide sales taxes: Alaska, Delaware, Montana, New Hampshire, and Oregon. Of these, only Alaska allows localities to impose local sales taxes.

Alaska is looking pretty good, even during the winter, with their combined state and local and sales tax rates. You may want to investigate the utility rates though as I have no idea of the rates.

According to the Tax Foundation, California has the highest state-level sales tax rate, at 7.25 percent.[2] Four states tie for the second-highest statewide rate, at 7 percent: Indiana, Mississippi, Rhode Island, and Tennessee. The lowest non-zero state-level sales tax is in Colorado, which has a rate of 2.9 percent. Five states follow with 4 percent rates: Alabama, Georgia, Hawaii, New York, and Wyoming.[3]

No state rates have changed since South Dakota cut its state sales tax rate in 2023, a reduction set to expire after 2026. The Mount Rushmore State follows on the heels of New Mexico, which lowered the rate of its state-level sales tax—a hybrid tax the state refers to as its gross receipts tax—from 5.125 percent to 5 percent in July 2022. Notably, if the revenue from the gross receipts tax in any single fiscal year from 2026 to 2029 is less than 95 percent of the previous year’s revenue, then the state’s rate will return to 5.125 percent on the following July 1.

Before that, the most recent statewide rate reduction was Louisiana’s cut, from 5.0 to 4.45 percent, in July 2018. State lawmakers have instead prioritized income tax cuts, which yield more economic benefit, reducing individual or corporate income tax rates (or both) in more than two dozen states in the past two years alone.

For all 50 State Tax Rates, go to the Tax Foundation Link at https://taxfoundation.org/data/all/state/2024-sales-taxes/  to download an accurate chart for 2024.

Thank you Tax Foundation Team with special mention to writer Jared Walczak, VP State Projects.

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Foreign Earned Income Exclusion For US Expats

Foreign Earned Income Exclusion for US Expats

Even if you’ve moved abroad for a brighter future, you still might have obligations towards the IRS. What happens if you earn income from sources outside the United States? If you live abroad, you might qualify for the foreign earned income exclusion (FEIE). This article explains what FEIE is and how it works, and provides some examples of situations where you might benefit from claiming it.

The U.S. retains its right to tax citizens and Green Card holders who live abroad and they must file their taxes even if they’re not physically present in the country. The foreign earned income exclusion (FEIE) allows U.S. taxpayers to exclude from their taxable income certain amounts they earn outside the United States. The FEIE was created in 1954 to relive American Citizens from the burden of double taxation when they move overseas.

WHAT IS THE FOREIGN EARNED INCOME EXCLUSION?

The Foreign Earned Income Exclusion is an IRS exclusion that American expats can use to reduce their taxable income (or in some cases completely eliminate) i.e. their U.S. tax owing. It is the most common and the most widely used tool to reduce US expat tax owing that the IRS offers.

You don’t automatically receive the benefit of FEIE by just living abroad — you must meet specific qualifications which we will discuss later and submit the Form 2555.

HOW MUCH FOREIGN EARNED INCOME CAN YOU EXCLUDE?

U.S. citizens and resident aliens who meet certain requirements to exclude up to $120,000 of foreign-earned income in 2023 (The FEIE is adjusted every year for inflation). If used correctly, the FEIE can help you save thousands of dollars on your US taxes.

The maximum exclusion for 2024 is $126,500. If you’re filing under the married filing jointly status and your spouse also meets the FEIE requirements, you can exclude up to $253,000 of your foreign income in 2024.

FILING FOR THE FOREIGN EARNED INCOME EXCLUSION: A GUIDE FOR MARRIED COUPLES FILING JOINTLY

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Secret To Retain Tax Staff: Support Tax Teams Technical Growth

Secret To Retain Tax Staff

REGISTER FOR A COMPLIMENTARY TAX TRAINING WEBINAR ON FRIDAY, FEBRUARY 9, 2024

Over the years, we have learned one true and tested fact… if you want to attract and retain your tax staff they are hungry to increase their tax knowledge and technical skills. The Number One reason  tax staff turnover rate is so high is their desire to learn and grow in their careers. Create opportunities for technical growth and they will stay with you longer. Immersing your tax team in a steady education program is the secret to retaining them longer. Tax team members will benefit greatly from educational opportunities inside and outside their primary areas of tax expertise. A successful tax leader will provide tax professional team members more educational opportunities to grow. Whether you are leading a corporate tax organization or a public accounting firm, there is a wonderful opportunity to connect with great trainers in other specialities. The firm Source Advisors offers a list of complimentary tax courses, and they even develop custom training courses for your tax organization. It is their way to build familiarity with their level of expertise in and build trusted business relationships.

The more effort you put into the professional growth and development of your tax team, the longer they will stay with your organization.

Take this opportunity to contact Eric Larson to arrange complimentary training courses for your tax team(415-730-5247 or Eric.Larson@SourceAdvisors.com) to arrange in house tax training course for your tax team. We set aside a meeting each Monday morning as a warm up to our week and goals to meet. We also communicate what everyone on the team is focused on to encourage team collaboration. This is a wonderful technique to build team support, focus on team projects and retain staff longer.

Contact Eric Larson at Source Advisors to request complimentary tax training for your tax team.
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Join Us For A Complimentary CPE Webinar On §174 Legislative Update and 2023 Recap

REGISTER HERE FOR COMPLIMENTARY WEBINAR

Join us for a CPE webinar on §174 Legislative Update and 2023 Recap. Participants will gain an understanding of any current legislative updates, any new regulations or sub regulatory guidance, and best practices for advising clients on tax accounting changes involving depreciation, the ERTC, R&D costs, and the §163(j) business interest deduction limit.

DATE: Friday, February 9th, 2024 at 11:00 AM EST

REGISTER HERE FOR COMPLIMENTARY WEBINAR

Learning Objectives:

• How to assist business clients in planning for any legislative changes due to H.R. 7024 with respect to R&D costs, bonus depreciation, interest deductions, or the Employee Retention Tax Credit

• Compliance options for 2023 §174 Specified Research or Experimental expenditures in light of current legislation Register for CPE Course!

Prerequisites:
At least two years preparing intermediately complex business income tax returns. No advance preparation is required.

Recommended Credit: 1.0 hour CPE in the field of Taxes delivered by Group Internet Attendance Policy:
To receive credit, attendees must sign in and be present for the presentation and respond to at least three instances of the attendance monitoring mechanisms per hour of instruction
Source Advisors (800) 806-7626

info@sourceadvisors.com SourceHOV Tax LLC dba Source Advisors is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.NASBARegistry.org.

REGISTER HERE FOR COMPLIMENTARY WEBINAR – Friday, February 9th 2024

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Senate Unveils A Bill Costing U.S. Taxpayers $118.28 BILLION DOLLARS: What Do You Think?

$118 BILLION DOLLAR BILL FOR TAXPAYERS

According to Chief Whitehouse Correspondent Simon Ateba, The $118.28 Bill for taxpayers is a national security supplemental package that includes the following:

  • $60.06 BILLION to support Ukraine as it fights Putin’s bloody invasion and protects its people and sovereignty.
  • $14.1 BILLION in security assistance for Israel.
  • $2.44 BILLION to support operations in U.S. Central Command and address combat expenditures related to the conflict in the Red Sea.
  • $10 BILLION in humanitarian assistance to provide food, water,shelter, medical care, and other essential services to civilians in Gaza and the West Bank, Ukraine and other populations caught in conflict zones across the globe.
  • $4.83 BILLION to  support key regional partners in the Indo-Pacific and deter aggression by the Chinese government.
  • $2.33 BILLION to continue support for Ukrainians displaced by Putin’s war of aggression and other refugees fleeing persecution.
  • The bipartisan  border policy changes negotiated by Chris Murphy(D-CT), Krysten Sinema(I-AZ), and James Lankford (R-Oklahoma).
  • $20.23 BILLION to address existing operational needs and expand capabilities at our nation’s borders, resource the new border policies included in the package, and help stop the flow of fentanyl and other narcotics.
  • The Fentanyl Eradication and Narcotics Deterrence (FEND) Off Fentanyl Act.
  • $400 MILLION for the NonProfit Security Program to help nonprofits and places of worship make security enhancements.

House Speaker @SpeakerJohnson calls it “dead on arrival.” President Biden praises it.

Here are 8 Takeaways:

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A Closer Look At Florida’s Sales Tax Exemptions

A Closer Look At Florida’s Sales Tax Exemptions

Most of the state sales tax (89.7 percent) goes into the General Revenue (GR) Fund, providing three-quarters of total GR funds. Ninety percent of GR goes to education, human services, and public safety. In short, the sales tax is critical to the operation of Florida government. While the sales tax and use tax is responsible for raising the majority of the state’s tax revenue, there are 281 exemptions in law worth billions of dollars more in tax revenue. One of Florida House Speaker Paul Renner’s priorities for the 2023 Session is a review of the sales tax and the sales tax exemptions currently in law. The Speaker asked for Florida TaxWatch’s input in this effort. Florida TaxWatch has performed a thorough review of current sales tax exemptions, not to develop a list of specific exemptions that should be repealed, but rather to identify exemptions that must be retained and those that for which the Legislature could further analyze if it wanted to eliminate exemptions. This report highlights exemptions that are necessary to maintain the nature and structure of the sales tax as a tax on the final retail sale of tangible personal property, such as those that avoid pyramiding. It also highlights exemptions that are required by the Constitution or other controlling law, or those that apply to life’s necessities (e.g., groceries, prescription drugs, residential utilities, etc.). For the others, beauty is in the eye of the beholder. Exemptions do not generally fare well when measured against the generally accepted characteristics of good tax policy (neutrality, fairness, simplicity, visibility), although individually they can remediate inequities among subsets of taxpayers and can avoid taxing items that would require an overly complex system for which the cost to administer and collect outweigh the minor amount of revenue raised. Some view sales tax exemptions as a good way to keep taxes on families and businesses low, promote economic development, and support the good work of Florida’s non-profit organizations. Others see them as “loopholes,” “giveaways,” or lost opportunities to raise revenue for government services. Past Florida TaxWatch research on sales tax exemptions has shown that most have at least some justification and some are even essential, but a periodic review of tax breaks is a valuable exercise.

A Closer Look At Florida’s Tax Exemptions
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Property Taxes For 2024 Reflect A Record Year Of Inflation In Florida

Florida Property Tax

Projected hikes in property appraisals accurately predicted taxing consequences.

Homeowners across Central Florida have received their proposed property taxes for the year, and for many, it’s the highest increase they’ve seen yet. Some will have to pay hundreds more every month.

These taxes are assessed based on the real estate market value of homes, which is just now starting to slowly come down after an all-time high.

Dominic Calabro, president and CEO of Florida TaxWatch, a tax research institute, said the system is becoming unsustainable.

Along with impact fees, a rise in population, and the highest inflation in the nation, the financial stress might be enough to squeeze some people out of the market.

“At some point, we’re going to make Florida a place where you’re like, ‘Oh, it’s wonderful, but, the cost of food, the cost of housing, all these things, it’s prohibitive and difficult for people of average means, let alone low income means,” he said.

He said that while taxes serve a critical role in society, the lack of balance is getting out of control and affecting people, especially those who live on low and medium wages.

Originally, he said, it was expected for people not to spend more than 30% of their income on rent. Now, some are spending upwards of 80% on it.

“It’s a real important balancing act, really, to make sure that taxes are collected and raised in a manner that still allows people to retain much of their own income.”

Calabro said homeowners should take advantage of homestead exemptions, as well as becoming engaged in their local city and county politics to effect change.

A proposed bill to include an amendment in the 2024 ballot that would help lower property taxes in Florida, HJR 469, died on the house floor in May.

Lillian Hernández Caraballo is a Report for America corps member. Article posted on NPR

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