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Instructions to file a Utah SALT (State and Local Tax) Report and make a State tax payment.
There has been significant confusion regarding what happened during December 2024 regarding the Beneficial Ownership Information (BOI) reporting requirements of the Corporate Transparency Act’s (CTA).
Here is a breakdown of recent actions regarding the BOI reporting requirements:
- December 3, 2024: The U.S. District Court for the Eastern District of Texas issued a nationwide preliminary injunction, temporarily halting enforcement of the CTA’s BOI reporting requirements.
- December 23, 2024: The U.S. Court of Appeals for the Fifth Circuit stayed the preliminary injunction, reinstating the CTA’s reporting obligations. In response, the Financial Crimes Enforcement Network (FinCEN) extended the reporting deadline to January 13, 2025, for companies created or registered before January 1, 2024.
- December 26, 2024: A different panel of the Fifth Circuit vacated the stay, reinstating the preliminary injunction. Consequently, reporting companies are not currently required to file BOI reports with FinCEN.
The final court ruling on this matter is anticipated in the coming months. Given the ongoing legal proceedings, experts are recommending that all companies continue to gather the necessary information to file BOI reports, should the requirement be reinstated. While filing is currently voluntary, proactively preparing will facilitate compliance if mandatory reporting resumes.
Please contact us for more information.
On Tuesday, December 3, 2024, a federal district court found that the Corporate Transparency Act (CTA) is likely unconstitutional. An order was issued prohibiting the enforcement of the CTA and the Beneficial Ownership Filing Requirements.
Describing the CTA as “quasi-Orwellian,” the court stated that the legislation is “likely unconstitutional as outside of Congress’s power.” according to reporting from the AICPA’s Journal of Accountancy
Under the injunction, CTA and BOI reporting rules cannot be enforced. Companies no longer need to comply with the Jan. 1, 2025 reporting deadline.
A+P CPAs is monitoring the change in the BOI reporting requirements. Please contact us with any questions.
Beneficial Ownership Information (BOI) Reporting
New BOI Requirements for 2024: Beginning in 2024, most corporations, LLCs, and other entities created or registered in the U.S. must report their Beneficial Ownership Information (BOI) to the Financial Crimes Enforcement Network (FinCEN).
What is BOI Reporting?
BOI Reporting is a legal requirement aimed at increasing transparency in ownership structures. It helps prevent money laundering, fraud, and other financial crimes by identifying individuals who own or control at least 25% of a company.
Who Needs to Report?
- Corporations
- Limited Liability Companies (LLCs)
- Other U.S. entities
- Foreign entities registered to do business in the U.S.
- Exceptions:
- Entities with 20 or more full-time employees, and
- Has a physical location in the U.S., and
- Reported more than $5 Million of Gross Receipts on the entity’s most recently filed income tax return.
Deadlines & Penalties:
- Deadlines:
- Entities established prior to January 1, 2024, must submit their reports by January 1, 2025.
- Entities established between January 1, 2024, and January 1, 2025, have 90 days from creation or registration to submit their reports.
- Entities established after January 1, 2025, have 30 days from creation or registration to submit their reports.
- Penalties: Failure to comply can result in significant fines up to $500 per day and criminal penalties of up to $10,000 or 2 years in prison.
How A+P CPAs Can Help:
We specialize in guiding businesses through BOI compliance. Our services include:
- Comprehensive BOI analysis
- Filing assistance with FinCEN
- Ongoing compliance support
Contact Us Today!
Avoid penalties and ensure compliance with BOI reporting regulations.
The Internal Revenue Service (IRS) has announced the tax year 2023 annual inflation adjustments for more than 60 tax provisions, including the tax rate schedules and other tax changes. Here are some of the highlights of the changes:
- The standard deduction for married couples filing jointly for tax year 2023 rises to $27,700, up $1,800 from the prior year. For single taxpayers and married individuals filing separately, the standard deduction rises to $13,850 for 2023, up $900, and for heads of households, the standard deduction will be $20,800 for tax year 2023, up $1,400 from the amount for tax year 2022 .
- The top tax rate remains 37% for individual single taxpayers with incomes greater than $578,125 ($693,750 for married couples filing jointly). The other rates are: 35% for incomes over $231,250 ($462,500 for married couples filing jointly); 32% for incomes over $182,100 ($364,200 for married couples filing jointly); 24% for incomes over $95,375 ($190,750 for married couples filing jointly); 22% for incomes over $44,725 ($89,450 for married couples filing jointly); 12% for incomes over $11,000 ($22,000 for married couples filing jointly). The lowest rate is 10% for incomes of single individuals with incomes of $11,000 or less ($22,000 for married couples filing jointly) .
- The Alternative Minimum Tax exemption amount for tax year 2023 is $81,300 and begins to phase out at $578,150 ($126,500 for married couples filing jointly for whom the exemption begins to phase out at $1,156,300). The 2022 exemption amount was $75,900 and began to phase out at $539,900 ($118,100 for married couples filing jointly for whom the exemption began to phase out at $1,079,800) .
- The tax year 2023 maximum Earned Income Tax Credit amount is $7,430 for qualifying taxpayers who have three or more qualifying children, up from $6,935 for tax year 2022.
In addition, the Inflation Reduction Act extended certain energy-related tax breaks and indexed for inflation the energy-efficient commercial buildings deduction beginning with tax year 2023. For tax year 2023, the applicable dollar value used to determine the maximum allowance of the deduction is $0.54 increased (but not above $1.07) by $0.02 for each percentage point by which the total annual energy and power costs for the building are certified to be reduced by a percentage greater than 25 percent. The applicable dollar value used to determine the increased deduction amount for certain property is $2.68 increased (but not above $5.36) by $0.11 for each percentage point by which the total annual energy and power costs for the building are certified to be reduced by a percentage greater than 25 percent.
Recent Tax Changes for 2022
The year 2022 has brought significant changes to the tax laws in the United States. Here are some of the most important changes that you should know before filing your tax return.
Child Tax Credit
The child tax credit has been reduced for 2022. In 2021, the child tax credit offered up to $3,600 per child under age 6, and up to $3,000 per child ages 6 through 17, with half available via upfront payments. But for 2022, the tax break reverts to the previous amount — up to $2,000 per child under age 17.
Child and Dependent Care Tax Credit
The child and dependent care tax credit, which may help offset the cost of care for children under age 13 or adult dependents, has also been reduced for 2022. In 2021, the credit jumped to up to $8,000 for one qualifying person or $16,000 for two or more dependents. However, for 2022, those caps returned to $3,000 and $6,000, for one or multiple dependents, respectively.
Form 1099-K
If you’ve received payments through apps like Venmo or PayPal in 2022, you may get Form 1099-K in early 2023, which reports income from third-party networks. The form applies to business transactions, such as part-time work, side jobs or selling goods, according to the IRS. Before 2022, the federal Form 1099-K reporting threshold was for taxpayers with more than 200 transactions worth an aggregate above $20,000. Now, however, the threshold is just $600, and even a single transaction can trigger the form.
