2021 Main Street Small Business Tax Credit in California

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California’s governor signed Assembly Bill (AB) 150 establishing the Main Street Small Business Tax Credit II.

However, You must claim this credit on a timely filed original tax return. You cannot claim this credit on an amended (not original) tax return.

Taking a deeper dive into the 2021 main street small business tax credit

This bill provides financial relief to qualified small businesses for the economic disruptions in 2020 and 2021 that have resulted in unprecedented job losses.

Taxpayers can use the credit against income taxes, or can make an irrevocable election to apply the credit against sales and use taxes.

How to qualify for the Main street small business tax credit in California

To qualify for the credit, taxpayers (qualified small business employers) must:

  1. Have 500 or fewer employees on December 31, 2020 (all employees, including part-time employees), whose wages are subject to California withholding laws.
  2. Have experienced a decrease of 20% or more in gross receipts:
    • Calendar year filers compare gross receipts for 2020 to gross receipts for 2019.
    • Fiscal year filers can either:
      • Compare gross receipts for fiscal year 2019-20 to the gross receipts for fiscal year 2018-19.
      • Compare the gross receipts average for fiscal year 2019-20 and fiscal year 2020-21 to the gross receipts for fiscal year 2018-19.
    • New businesses that commenced business after January 1, 2019, but on or before January 1, 2020 can determine by comparing gross receipts from:
      • January 1, 2020, through February 28, 2020, multiplied by 1.5 to gross receipts for the period of April 1, 2020 and ending on June 30, 2020.
  3. Apply for a tentative credit reservation from CDTFA during the period of November 1, 2021 through November 30, 2021, and receive a tentative credit reservation.
  4. Not be required or authorized to be included in a combined report.

For each taxable year beginning on or after January 1, 2021, and before January 1, 2022, the new law allows a qualified small business employer a small business hiring tax credit, subject to receiving a tentative credit reservation through the California Department of Tax and Fee Administration (CDTFA).

All taxpayers (including those electing to use the credit to offset qualified sales and use taxes) must reduce any deduction otherwise allowed for qualified wages by the amount of the credit allowed.

Tentative credit reservation period

You can apply for a tentative credit reservation from November 1 through November 30, 2021, or an earlier date if the limit for the credit is reached before November 30, 2021. The credit is allocated by CDTFA on a first-come, first-served basis. The allocation limit for this credit will be approximately $116 million.

Considerations for S corporations

S corporations electing to apply the credit against qualified sales and use taxes:

  • Can claim the full credit against sales and use taxes.
  • Cannot pass through any of the credit to its shareholders.

S corporations electing to apply the credit against franchise and income taxes:

  • Are limited to applying 1/3 of the tentative credit reservation amount (from their confirmation from CDTFA) against the tax on net income at the S corporation level. They may not use the credit to offset the $800 minimum franchise tax.
  • Must disregard the remaining 2/3 of the credit and the S corporation may not use it as a carryover credit.
  • Can pass through the full credit amount to their shareholders, who may use the credit against their personal income taxes.

Credit amount

The amount is equal to $1,000 for each net increase in qualified employees, measured by the monthly average full-time employee equivalents. For more information on computing the credit, visit CDTFA.ca.gov.

Each employer is limited to no more than $150,000 in credit.

The amount of credit you may receive for the 2021 taxable year is reduced by the Main Street Small Business Tax Credit for taxable year 2020. Your 2021 credit will be reduced by either:

  • Your 2020 credit allocated for application to Sales and Use Tax; or,
  • Your 2020 credit received for application against income taxes

Qualified employee:

  • Must be paid wages subject to withholding under the California Unemployment Insurance Code.
  • Cannot receive wages that are used in the calculation of any other tax credit, except for the Main Street Small Business Tax Credit, for taxable year 2020.
  • Is not paid as an independent contractor.

How to claim the Main Street Small Business Tax Credit

  • File your income tax return timely.
  • Include your Main Street Small Business Tax Credit (FTB 3866) form, to claim the credit.
    • We’re currently updating the FTB 3866 for the 2021 tax year and it will be available by January 1, 2022.
    • Provide the confirmation number (received from CDTFA on your Tentative Credit Reservation) when claiming the credit.
    • Use credit code 241 when claiming the credit.
  • Review the Specific Line Instructions (page 2) for form FTB 3866, for more information.
  • Unused credits may be carried over for 5 years or until exhausted.

Fell free to contact us.

Top 10 Tax Write offs for 2020

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Having your own business can mean many exciting things, from acting as your own boss, having control over your products and services, and making your income from your hard work. Along with that, the perk of investing in your business and what to use as a tax write-off for what you spend. This can make the following a bit more complicated, but much more worth it after seeing the numbers come back. So, keep track of your spending and save those receipts.

How Do I get a 2020 Tax Write-Off?

First off, you need to know what a write-off means to start organizing yourself for this task. Simply put, a write-off consists of any legitimate expenses that can get deducted from your business’s taxable income on your upcoming tax return. Using the term “write-off” means the reduction of something financially. During tax season, people write-off or reduce their taxable income by writing-off these expenses. Your taxable income consists of the amount of your income that the government will tax.

There’s a ton of things you can do to write-off expenses. Since there’s no clear line saying what you can and cannot write off, just remember that it must somehow directly relate to your business.

2020 Tax Write-Off Examples

To give you a more general idea of what businesses will write off, take some of these into consideration. Each of them directly relates to the business to function and provide services. The IRS defines tax write-offs to be “Ordinary and Necessary” to the business.

Advertisement and Promotions 

When investing in advertising for your company, it’s completely deductible. This means getting someone to create logos and designs for you, printing business cards or brochures, social media ads, and campaigns. These are all ways to help your business and are crucial to call attention to your company.

Business meals Tax Write Offs for 2020

Business meals are a little tricky since you can only deduct 50% of these costs. When you buy food for those late nights at the office or provided at company parties and events, this comes into effect. The food must qualify to fall under this category. It can’t list as anything lavish or extravagant. Keep the purpose written on the back of the receipt to remember why the purchase was made easily.

Business Insurance 

You can deduct the renter’s insurance you have for your home office or portion of your home to make your business run. It can even get used for rented buildings for your business as well.

Bank Fees and Interest 

If your credit card or bank charges monthly or annual fees for service, transfers, or overdrafts, then they all qualify. Even merchant and transaction fees applied to third party processors will qualify as deductible. Even the interest for your business card can get deducted if it’s only used for business purposes.

Business Travel Expenses 

Anything involving travel with your business can get used as a write-off. This means flights, places to stay, car usage, and more. There’s a lot of information on business expenses on the IRS website.

Depreciation 

This can come into play if you’re writing off big items like cars or equipment over the item’s lifetime instead of having the deduction all in one year. Here’s a formula created for this to make it simpler to calculate.

Depreciation = Asset Total Cost / Asset Lifetime

Education 

If you’re looking to add value to your expertise in your business, education can get deducted. To see if your classes will qualify, the IRS will determine if they improve skills relevant to your business. This can even count for workshops, seminars, webinars, subscriptions, and books.

Home office Tax Write Off 2020

A lot of businesses are working from home right now, and this can also get deducted. If you have a home office set up and a specific area for your work, then you need to look at the square footage. This area must only get used for work, though. You don’t have to devote an entire room, but it should be clear that only work happens here. Keep some photos to back up your workspace if you plan on doing this.

Salaries And Benefits

Almost every business out there will have a staff. No matter how big or small, that money probably comes from the business pocket. Take in mind salaries, benefits, bonuses, anything you pay out your employees is deductible. Even freelancers and contract works fall under this category.

Have Ever Write-Off For Tax Time 

Overall, we could continue the long list of expenses, but these are some of the most common and important write-offs you will come across. We help you with your business accounting services. If you have any questions or need some advice, contact us so we can help you. With 20 years of experience, we can help break down your write-offs for your business and make every tax year smooth and simple.

How soon Can you File Taxes In California?

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How Soon Can you File Taxes in California?

How early can you file your tax return in CA, when does the IRS start accepting returns, how can you get started before the IRS opens, and what does this all mean for your tax refund?

 

When is the earliest I can file?

 

Because so many of our clients are excited to get their refunds, we get asked all the time, “When is the earliest I can file my federal tax return?”

 

You cannot technically file your federal taxes until the IRS starts accepting returns. However, you can begin to fill out your return with a pay stub and complete it when you have your W-2 form or other necessary tax documents. Tax-preparation services can also help with this.

 

You can prepare and submit your return as soon as you receive your W-2s from your employers and have all the relevant information and documents. Most W-2s arrive in mid-January, but employers have until January 31, 2020, to send W-2s and Forms 1099, so you could receive yours as late as early February.

In California How Fast Can I Get My Tax Refund In 2020?

If you’re like most Americans, your tax refund feels like the biggest paycheck you’ll receive all year. Learn when you’ll be receiving your refund in 2020, and how you could hurry that process up.

 

For millions of Americans, your tax refund feels like the biggest paycheck you’ll receive all year so filing your taxes is your most important financial transaction.1

Tax Refund Timing

According to the IRS, most refunds are funded within 21 days of filing. This clock starts after the IRS begins processing tax returns for the year, which is usually at the end of January. For the upcoming tax season, the IRS announced that it will open its doors and begin processing returns on January 27, 2020.

However, due to the PATH Act, clients claiming the Earned Income Tax Credit (EITC) and/or the Additional Child Tax Credit (ACTC), should expect a delay in their refunds. Due to tax laws aimed to protect a taxpayer’s identity, refunds claiming EITC and ACTC will begin funding after February 21, 2020. Also, the refund status for those clients may not be available on the IRS.gov website until Feb 21.

It is extremely important to file early so you can get your refund as soon as possible.

You can always ask us to check the status of your refund and well give you a date of expectancy for your return to hit your bank account.

Will Your Refund Be Delayed?

In the end, how quickly you receive your tax refund depends on when you file your taxes, how you choose to file, and what credits and deductions you might claim. While refunds including EITC and ACTC will be funded no earlier than February 21, you will still benefit by filing early. You are giving the IRS plenty of time to review your return, verify your EITC and ACTC eligibility, and W2 authenticity, which is required before your return is processed. Additionally, filing with a tax professional who e-files is safe and secure and will also save you time.

Tax Credits, Deductions, and Getting Your Biggest Refund

One of the first elements to getting your biggest refund is making sure you don’t miss any tax credits or deductions you deserve. If your circumstances have changed from last year, there may be a number of new credits or tax deductions available to you. Because you may not know that you’re eligible, a Tax Pro can help you make sure you don’t leave any money on the table. Visit our Tax Refund Calculator to get your estimate.

Life Changes and Your Tax Refund

Tax credits and deductions are often connected to major life circumstances, so they may change from year to year based on your personal situation. For example, getting married, having a baby, or retiring could all have an impact on your taxes. Don’t miss out on some of these commonly overlooked areas.

The Fast Way to Get Your Tax Refund

There are a number of ways to get money early. Filing as early as possible will give you a better chance of being in the first round of returns processed by the IRS. Electronic or e-filing gets your return to the IRS quicker than mailing a paper return. The sooner they receive your return, the sooner they can begin processing. Choosing to have your refund directly deposited into your bank account instead of receiving a check in the mail is also faster. Another way to get your refund early is to choose to load it onto a prepaid card. Your refund will be available up to two days faster than standard direct deposit. Those two days can mean the difference between getting your refund on a Friday or waiting until Tuesday of the following week. It makes a big difference for most of our hard-working clients.

Starting your tax season early

Most taxpayers count on getting a refund as soon as possible, but sometimes, that is not quick enough. If you rely on your refund to pay bills you may qualify for tax time loans. Book an appointment with Heather’s Bookkeeping and Tax Services to learn more. We are open and ready to help with your tax needs for 2021.

Marijuana is legal in these states 2020 – How will this help your taxes?

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The legalization of cannabis in 2020 will be considered in several U.S. states in 2020. States considered likely to legalize it for recreational use include Arizona, Florida, New Jersey, New Mexico, and New York. Voters in Arizona, Montana, New Jersey and South Dakota cleared cannabis for adult use, bringing the total number of states that have approved it for that purpose to 15.

Question: How do marijuana taxes work?

Answer: Marijuana sales are legal and taxed in nine states. States currently levy three types of marijuana taxes: as a percentage of the price (either the retail or wholesale price), based on weight (i.e., per ounce), and based on the drug’s potency (i.e., THC level). Some states use a combination of these taxes.

 

DO STATE AND LOCAL GOVERNMENTS RAISE FROM MARIJUANA TAXES?

Although prohibited under federal law, marijuana sales are legal and taxed in nine states: Alaska, California, Colorado, Illinois, Massachusetts, Michigan, Nevada, Oregon, and Washington. Marijuana is legal in Maine and Vermont but neither state has established its tax system yet. The District of Columbia also legalized marijuana but Congress currently prevents the city from regulating and taxing sales.

California Marijuana Taxes: 15% state excise tax on retail sales. Cultivators pay $9.25 per ounce for flowers and $2.75 per ounce for leaves. Localities (cities) can levy an excise tax on retail sales.

California’s revenue pays for administrative costs associated with marijuana legalization, and then uses excess funds for programs related to drug use, including economic development, academic studies, and youth programs.

 

Colorado  and Washington have collected marijuana taxes since 2014. In the calendar year 2018, Colorado collected $267 million and Washington collected $439 million in state marijuana taxes, or roughly 1 percent of state and local own-source revenue in each state. Four other states reported a full year’s worth of state marijuana tax revenue in 2018: Alaska ($15 million), California ($354 million), Nevada ($87 million), and Oregon ($94 million). All totals were less than 1 percent of state and local own-source general revenue. (Note: None of these totals include local tax revenue.)

 

Marijuana is legal in 11 new states at the beginning of 2020 and will increase to 15 states in 2021.

Marijuana is legal in 11 new states and some of these states levy a tax on the purchase. But these tax rates are often the same as or close to the state’s general sales tax rate and do not raise much revenue.

HOW DO MARIJUANA TAX RATES DIFFER?

There are three ways state and local governments tax marijuana.

Percentage-of-price. These taxes are similar to a retail sales tax where the consumer pays a tax on the purchase price and the retailer remits it to the state. A few states levy their percentage of price tax on the wholesale transaction, but it is assumed this cost is then passed on to the consumer in the final purchase price. Some states also let localities levy a percentage of price tax—typically with a maximum rate.

Weight-based. These taxes are similar to cigarette taxes, except instead of taxing per pack of cigarettes the tax is based on the weight of the marijuana product. States with this type of tax also typically set different rates for different marijuana products. For example, California  levies a $9.65 per ounce tax on marijuana flowers, a $2.87 per ounce tax on marijuana leaves, and a $1.35 per ounce tax on fresh plant material. As with other wholesale taxes, it is assumed most of this cost is passed on to the consumer in the final purchase price.

Potency-based. These taxes are similar to alcohol taxes, except instead of taxing drinks with a higher percentage of alcohol at higher rates (i.e., liquor is taxed at a higher rate than beer), the tax is based on the THC level of the marijuana product. Illinois is currently the only state with a THC-based tax. It taxes products with a TCH content of 35 percent or less at 10 percent of retail price and those with more than 35 percent at 25 percent of retail price. All marijuana-infused products (e.g., edibles) are taxed at 20 percent of retail price.

Some states also levy their general sales tax on the purchase of marijuana in addition to the excise taxes.

The New California Proposition 15, the Tax on Commercial and Industrial Properties

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Proposition 15: California Business property taxes

 

WHAT WOULD PROPOSITION 15 DO FOR CALIFORNIA?

Hike property taxes on big businesses, raising billions for schools and local governments. 

Now, owners pay property taxes based on the price they originally paid for that real estate — typically a lot less than what it’s worth today. If this measure passes, property taxes for many large businesses would be elevated to the property’s current, probably higher, market value. That would net $6.5 to $11.5 billion — 60% for cities, counties and special districts, and 40% for schools and community colleges.

Not (directly) affected: homeowners, and businesses with under $3 million in California property. Farm land would be exempt. An analysis by the nonpartisan Legislative Analyst’s Office wasn’t able to determine whether the buildings and other improvements on that land would be too.

WHY AM I VOTING ON THIS?

Back in 1978, California voters famously passed Proposition 13 — a huge permanent tax cut for landowners. It amended the state constitution to reset property taxes based on the purchase price of a home or business, and capped how much the tax could increase each year after that.

 

Deadline to register for an Economic Impact Payment (EIP) in California

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The Internal Revenue Service Economic Impact Payment (EIP) in California

 

The Internal Revenue Service announced some days ago that the deadline to register for an Economic Impact Payment (EIP) is now November 21, 2020. This new date will provide an additional five weeks beyond the original deadline. ( in Aug )

Helpful tool for Economic Impact Payment (EIP)

The IRS urges people who don’t typically file a tax return – and haven’t received an Economic Impact Payment – to register as quickly as possible using the Non-Filers:  on the IRS site https://www.irs.gov/coronavirus/non-filers-enter-payment-info-here. The tool will not be available after November 21.

“We took this step to provide more time for those who have not yet received a payment to register to get their money, including those in low-income and underserved communities,” said IRS Commissioner Chuck Rettig. “The IRS is deeply involved in processing and programming that overlaps filing seasons. Any further extension beyond November would adversely impact our work on the 2020 and 2021 filing seasons. The Non-Filers portal has been available since the spring and has been used successfully by many millions of Americans.”

For taxpayers who requested an extension of time to file their 2019 tax return

Special note: This additional time into November is solely for those who have not received their EIP and don’t normally file a tax return. For taxpayers who requested an extension of time to file their 2019 tax return, that deadline date remains October 15.

To support the ongoing EIP effort, many partner groups have been working with the IRS, helping translate and making available in 35 languages IRS information and resources on Economic Impact Payments.

To help spread the word, the IRS sent nearly 9 million letters in September to people who may be eligible for the $1,200 Economic Impact Payments but don’t normally file a tax return. This push encourages people to use the Non-Filers tool on IRS.gov.

“Time is running out for those who don’t normally file a tax return to get their payments,” Rettig added. “Registration is quick and easy, and we urge everyone to share this information to reach as many people before the deadline.”

Who won’t receive Economic Impact Payment

While most eligible U.S. taxpayers have automatically received their Economic Impact Payment, others who don’t have a filing obligation need to use the Non-Filers tool to register with the IRS to get their money. Typically, this includes people who receive little or no income.

The Non-Filers tool is secure and is based on Free File Fillable Forms, part of the Free File Alliance’s offering of free products on IRS.gov.

The Non-Filers tool is designed for people with incomes typically below $24,400 for married couples, and $12,200 for singles who could not be claimed as a dependent by someone else. This includes couples and individuals who are experiencing homelessness.

Anyone using the Non-Filers tool can speed the arrival of their payment by choosing to receive it by direct deposit. Those not choosing this option will get a check.

Beginning two weeks after they register, people can track the status of their payment using the Get My Payment tool, available only on IRS.gov.

Covid-19 UPDATE: Get A $2,000 Stimulus Check Every Month

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As millions of Americans receive their $1,200 stimulus check today, a new proposal would give you $2,000 a month during the Coronavirus pandemic.

Here’s what you need to know.

Proposal: New Legislation

Two House Democrats want to enhance the $2.2 trillion stimulus package known as the CARES Act. Representatives Tim Ryan (D-OH) and Ro Khanna (D-CA) have introduced new congressional legislation — the Emergency Money for the People Act — to provide $2,000 per month to Americans who have been impacted by the COVID-19 pandemic. Under their proposed legislation, the congressmen would continue monthly cash payments to eligible Americans until employment returns to pre-COVID-19 levels. “A one-time, twelve hundred dollar check isn’t going to cut it,” Rep. Khanna said. “Americans need sustained cash infusions for the duration of this crisis in order to come out on the other side alive, healthy, and ready to get back to work.”

How It Would Work

The Emergency Money for the People Act would work like this:

  • Eligible Americans would receive $2,000 in cash per month guaranteed for at least six months.
  • These monthly cash payments would continue until the employment to population ratio for people ages 16 and older is greater than 60%.
  • The monthly cash payments would not count as income.
  • The monthly cash payments would not adversely impact anyone’s ability to qualify for an income-based federal or state assistance program.

Who’s Eligible

As with the $1,200 stimulus check (Economic Impact Payment), not every American would be eligible. Here’s who would get a monthly cash payment under this proposed legislation:

  • Every American adult age 16 and older making less than $130,000 annually would receive $2,000 a month;
  • Married couples earning less than $260,000 would receive at least $4,000 per month;
  • Qualifying families with children will receive an additional $500 per child, with funds capped at a maximum of three children.

For example, if you earn $100,000 of adjusted gross income per year and are a single tax filer, you would receive $2,000 a month. If you are married with no children and earn a combined $180,000 a year, you would receive $4,000 a month. If you are married with two children and earn a combined $200,000 a year, you would receive $5,000 a month. If you are married with five children and earn a combined $200,000 a year, you would receive a maximum of $5,500 a month because the $500 per dependent payment is only available for three children.

What if you don’t earn income or are unemployed?

If you had no earnings, were unemployed or are currently unemployed, you would be eligible.

What if you were not eligible for a stimulus check based on your 2018 or 2019 tax return, but you will be eligible in 2020?

You can be eligible and would need to submit at least two consecutive months of paychecks to verify your income.

Will most college students and adults with disabilities be excluded from these monthly payments?

No. Unlike the CARES Act, the Emergency Money for the People Act would make eligible college students and adults with disabilities who are still claimed as a dependent. The individual would receive the monthly payment and their parent or guardian would receive the dependent credit.

Looking for your Stimulus Checks

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The House passed Friday, and President Donald Trump is expected to swiftly sign, a $2 trillion stimulus bill to address the dramatic economic crisis caused by the coronavirus pandemic.
Included are direct payments to many Americans, an unprecedented expansion in unemployment benefits and $350 billion in small business loans.
But while people need help immediately, it will still take time to get everything moving.
Here’s what you need to know:

DIRECT STIMULUS PAYMENTS

How much do I get on my Stimulus Check?

Individuals would be due up to $1,200 and couples would receive up to $2,400 — plus $500 per child.
But the payments would start phasing out for individuals with adjusted gross incomes of more than $75,000. The amount would then be reduced by $5 for every additional $100 of adjusted gross income, and those making more than $99,000 would not receive anything.
The income thresholds would be doubled for couples.
Income would generally be based on one’s 2019 or 2018 tax returns. Those who made too much to qualify in those years, but see their income fall in 2020 would receive a tax credit when they file their return next year, according to the Senate Finance Committee.
And those who make more this year than last would not have to pay back any stimulus money they receive if they end up exceeding the thresholds. The payments would not be subject to tax, and those who owe back taxes would still get a check.

When will I receive my Stimulus Check Direct Deposit?

We don’t know how long it would take the IRS to send out all the money, but it would likely take weeks before the first payments start going out.
Treasury Secretary Steven Mnuchin said on Wednesday that the IRS would begin issuing payments within three weeks of the legislation being signed into law. The bill simply calls for payments to be made “as rapidly as possible.”
But experts say it could take longer. In 2001, it took six weeks for the IRS to start sending out rebate checks under a new tax cut, and in 2008, it took three months after a stimulus package was signed into law.
How do I get my money?
The money would likely be deposited directly into individuals’ bank accounts — as long as they’ve already authorized the IRS to send their tax refund that way over the past two years.
If not, the IRS would send out checks in the mail. For those that haven’t filed a 2019 or 2018 tax return, the IRS would rely on the information on file at the Social Security Administration, which keeps records on all Americans who have paid payroll taxes. It’s still possible that some people may fall through the cracks. On its website, the IRS says no sign-up would be needed to receive the money, but it’s possible the agency ends up offering further guidance.

UNEMPLOYMENT BENEFITS

How much do I get?
Jobless workers are poised to get an extra $600 a week on top of their state benefits for up to four months. It would significantly boost everyone’s regular state benefits, which range from about $200 to $550 a week, on average, depending on where you live.
Lawmakers also want to add up to 13 weeks of extended benefits, on top of state programs, which vary between up to 12 and 28 weeks.
Plus, more newly jobless Americans would receive checks. A new pandemic unemployment assistance program would expand eligibility to those who are unemployed, partially unemployed or unable to work because of the virus and don’t qualify for traditional benefits. This would include independent contractors, the self-employed and gig economy workers. The pandemic program benefits would mirror what’s available in one’s state.

When do I receive the money?
The timing would vary based on where you live, but likely several weeks at least.
Unemployment benefits are administered by states. They would have to reprogram their systems to account for Congress’ measures — of which there are a few, some more complicated to enact than others. Not helping matters is that many state unemployment agencies use antiquated technology.

Adding a $600 boost to everyone’s weekly check would be easier to accomplish, which is one reason why lawmakers designed the enhancement this way. During the Great Recession, the federal government temporarily increased benefits by $25 a week so this experience could help many states now, said Andrew Stettner, a senior fellow at The Century Foundation.
But Congress also wants to create a new pandemic unemployment assistance program, which would allow many more Americans to qualify for benefits. It’s modeled on the existing disaster unemployment assistance program, but only a few states have had to activate it in recent years, mainly because of hurricanes or floods.

All states would have to set up the pandemic program. So it would likely take even longer for jobless Americans who fall into this category to start receiving benefits, particularly in states that haven’t faced disasters recently.

All these federal changes come at a particularly tough time for states, which are being squeezed from both sides, said Rebecca Dixon, executive director of the National Employment Law Project. They are contending with a historic number of first-time filers, who are already overwhelming their online sites and call centers, forcing agencies to divert staff and boost technical capacity.

Plus, these agencies are operating at very low funding levels because of historically low unemployment rates.

SMALL BUSINESS LOANS

How much Stimulus is available?

The biggest provision for small business owners in the economic aid package is roughly $350 billion in new loans, at least a portion of which will be forgiven so long as the business continues to employ and pay its workers.
Business owners need to apply for the loans at a lender approved by the Small Business Administration. The forgiven amount would be equal to 8 weeks’ worth of payroll obligations (e.g., wages and benefits), plus rent or mortgage bills and utilities. And the forgiven debt would not be treated as taxable income to the owner.
How long will it take to get my Stimulus Check?
Normally SBA loans can take months, which many small businesses facing a cash crunch don’t have. To get the money out more quickly, the bill calls on Treasury and the Small Business Administration to expedite the loan process and approve more institutions to make the loans. It also loosens the rules normally governing SBA loans. For instance, borrowers do not need to issue a personal guarantee or provide collateral.
But SBA lenders themselves aren’t clear yet just how fast they can process the new loans, even though Treasury Secretary Steven Mnuchin has suggested publicly this week they can do so very quickly.
A joint letter from several banking and credit union associations this week urged the SBA to provide them with “clear and consistent” guidelines ASAP.
One non-bank direct SBA lender, Fountainhead, has been working for the past two weeks to streamline its own processes so that it will be able to process an application and close the new SBA loan in a matter of days, CEO Chris Hurn said. But lenders still need to know what documents and other reporting measures the SBA will require. Currently, Hurn noted, they have to upload a number of files on a borrower onto the SBA’s electronic system. With such an uptick in loans being issued, the chance for overload is real.

“There are some fundamental documents that I’m pretty sure the SBA is still going to want,” Hurn said. “To me, that’s going to be the bottleneck.”

California taxpayers get the Coronavirus tax extension on paying their taxes

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Due to the coronavirus, businesses and individual Californians taxpayers will get 90 more days to pay their taxes as long as its filed before April 15th, 2020.

Treasury Secretary Steven Mnuchin announced that his department is pushing back the April 15 tax deadline to pay taxes owed for many individuals and businesses, giving them 90 extra days to send checks to the government.

Individuals can defer up to $1 million of tax liability and corporations get an extension on up to $10 million, Mnuchin said on 03/17/2020.

 

What do you have to do to get your tax extension due to the Coronavirus / Covid-19 Pandemic 2020?

*File your 2019 taxes by April 15, 2020, and you will automatically not get charged interest or penalties.

We can help: CALL: 530-399-0989

Who does the Covid-19 Tax Payment extension 2020 affect?

Image result for peopleThe coronavirus tax payment extension, which affects millions of taxpayers, is part of the Trump administration’s effort to curb the economic effects of the coronavirus pandemic. Mnuchin said the delay will free $300 billion of liquidity in the economy as individuals and businesses have more time to pay their taxes.

 

How to delay your tax payment due to the coronavirus of 2020 for your business or for personal taxes?

Delaying your tax payment due to the coronavirus requirements will give businesses and individuals nearly three more months to meet their IRS obligations, potentially lessening cash-flow issues that some businesses are facing as many people stay home and spend less money on dining out, entertainment and transportation.

Individuals and businesses will still have to file by April 15, unless they submit paperwork for an automatic six-month extension, Mnuchin told reporters.

Taxpayers who are Wealthy individuals — ranging from the upper-middle class to the top 1% — could benefit the most from this move because they are more likely to owe the government money and be able to wait until the filing deadline to submit their returns, said John Koskinen, a former IRS commissioner.

Taxpayers who are Lower-income workers — especially those who qualify for refundable tax breaks such as the child tax credit and the earned income tax credit, tend to file early because they get a refund check.

“The number of blue-collar workers, working-class people, I imagine, who are filing in the first two weeks of April is probably a very small percentage,” Koskinen said.

Many higher-income people, especially those who own a business or invest in multiple partnerships, apply for an automatic six-month tax extension to file because their returns are more complicated. In a typical year, they’d have to submit 90% of their tax liability on April 15 or face interest and penalties on the late payment.

The administration is also considering delaying the estimated quarterly tax payments that self-employed workers and businesses pay the IRS throughout the year, according to two people familiar with the matter. The first tax payment is typically due April 15, 2020.

For more in-depth information please visit: https://www.irs.gov/ or https://www.irs.gov/coronavirus

The IRS has established a special section focused on steps to help taxpayers, businesses and others affected by the coronavirus. This page will be updated as new information is available. For other information about the COVID-19 virus, people should visit the Centers for Disease Control and Prevention (CDC) (https://www.coronavirus.gov) for health information. Other information about actions being taken by the U.S. government is available at https://www.usa.gov/coronavirus and in Spanish at https://gobierno.usa.gov/coronavirus. The Department of Treasury also has information available at Coronavirus: Resources, Updates, and What You Should Know.

Food and Sales Tax 2020 in California

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California sales tax details
The California state sales tax rate is 7.25%. This rate is made up of a base rate of 6%, plus California adds a mandatory local rate of 1.25% that goes directly to city and county tax officials. Depending on local sales tax jurisdictions, the total tax rate can be as high as 10.25%.

Food and prescription drugs are exempt from sales tax.

Amazon owns and operates a number of fulfillment centers in California. This physical presence, or nexus, creates a sales tax obligation for Amazon and many sellers participating in Amazon’s Seller Central and Fulfillment by Amazon (FBA) programs.

Businesses with nexus in California are required to register with the California Department of Tax and Fee Administration (CDTFA) and to charge, collect, and remit the appropriate tax.

Generally, a business has nexus in California when it has a physical presence there, such as a retail store, warehouse, inventory, or the regular presence of traveling salespeople or representatives. However, out-of-state sellers can also establish nexus.

California state sales tax rate

California Sales Tax Rate Guide7.25%

Base state sales tax rate6.0%
Mandatory local rate1.25%
Local rate range0.15%–3%
Total rate range*7.25%–10.25%

* Due to varying local sales tax rates, we strongly recommend using our California sales tax calculator to determine the exact sales tax rate for your location.

 

 

 

 

California sales tax changes effective April 2019

The following sales tax rate changes are set to go into effect April 1, 2019 in California. For specific details including effective rate date changes, please refer to document L-595 from the California BOE.

City County Prior Rate Rate Change New Rate
Alameda Alameda County 9.250% 0.500% 9.750%
Angels Camp Calaveras County 7.250% 0.500% 7.750%
Antioch Contra Costa County 8.750% 0.500% 9.250%
Bakersfield Kern County 7.250% 1.000% 8.250%
Barstow San Bernardino County 7.750% 1.000% 8.750%
Burbank Los Angeles County 9.500% 0.750% 10.250%
Carpinteria Santa Barbara County 7.750% 1.250% 9.000%
Chowchilla Madera County 7.750% 1.000% 8.750%
Coalinga Fresno County 7.975% 1.000% 8.975%
Cotati Sonoma County 9.125% 0.125% 9.250%
Covina Los Angeles County 9.500% 0.750% 10.250%
Cudahy Los Angeles County 9.500% 0.750% 10.250%
Culver City Los Angeles County 10.000% 0.250% 10.250%
Fowler Fresno County 7.975% 1.000% 8.975%
Garden Grove Orange County 7.750% 1.000% 8.750%
Glendale Los Angeles County 9.500% 0.750% 10.250%
Healdsburg Sonoma County 8.625% 0.125% 8.750%
Hollister San Benito County 8.250% 1.000% 9.250%
Kerman Fresno County 7.975% 1.000% 8.975%
King City Monterey County 8.250% 0.500% 8.750%
La Puente Los Angeles County 9.500% 0.500% 10.000%
Lawndale Los Angeles County 9.500% 0.750% 10.250%
Lodi San Joaquin County 7.750% 0.500% 8.250%
Los Banos Merced County 8.250% 0.500% 8.750%
Los Gatos Santa Clara County 9.000% 0.125% 9.125%
Marina Monterey County 8.750% 0.500% 9.250%
Martinez Contra Costa County 8.750% 0.500% 9.250%
Murrieta Riverside County 7.750% 1.000% 8.750%
Norco Riverside County 7.750% 1.000% 8.750%
Oceanside San Diego County 7.750% 0.500% 8.250%
Oroville Butte County 7.250% 1.000% 8.250%
Pasadena Los Angeles County 9.500% 0.750% 10.250%
Placentia Orange County 7.750% 1.000% 8.750%
Pomona Los Angeles County 9.500% 0.750% 10.250%
Port Hueneme Ventura County 7.750% 1.000% 8.750%
Porterville Tulare County 8.250% 1.000% 9.250%
Redwood City San Mateo County 8.750% 0.500% 9.250%
Rohnert Park Sonoma County 8.625% 0.125% 8.750%
Roseville Placer County 7.250% 0.500% 7.750%
Sacramento Sacramento County 8.250% 0.500% 8.750%
San Juan Bautista San Benito County 8.000% 1.000% 9.000%
Santa Ana Orange County 7.750% 1.500% 9.250%
Santa Fe Springs Los Angeles County 9.500% 1.000% 10.500%
Santa Maria Santa Barbara County 8.000% 0.750% 8.750%
Santa Rosa Sonoma County 8.625% 0.375% 9.000%
Seal Beach Orange County 7.750% 1.000% 8.750%
Sebastopol Sonoma County 8.875% 0.125% 9.000%
Sonoma Sonoma County 8.625% 0.125% 8.750%
Wildomar Riverside County 7.750% 1.000% 8.750%

Source: Avalara (https://www.avalara.com/taxrates/en/state-rates/california/rate-changes.html)