Employee Retention Credit Claims, Spending Stopgap, and Clean Vehicle Credits FAQ
Probity Tax Recovery is a tax consulting firm specializing in tax credits and incentives for small to mid-sized businesses. We work with business owners and their CPAs to identify tax credits and incentives while saving you time and money. Schedule a free consultation with a member of our team here.
FINCEN FILING: Beginning this year, most small companies have a NEW small business filing requirement with FinCEN call the Business Ownership Information Report, that can be time confusing. Failure to file or erroneous filings can result in jail time and up to $10,000 in fines. Our team can handle the filing for you with minimal effort on your end. To get started, schedule a time to speak with us here.
Tax Policy/News:
July 26: IRS Warns of Incorrect Claims for Employee Retention Credit
The IRS has issued a warning about the increasing prevalence of incorrect claims for the Employee Retention Credit (ERC), urging businesses to review their filings to ensure accuracy.
This advisory highlights common errors, such as misinterpreting eligibility criteria and improperly calculating the credit amount, which could result in significant penalties, interest, and potential audits.
The IRS emphasizes the importance of understanding the specific conditions under which the ERC can be claimed, including factors like revenue reductions and government-mandated shutdowns.
Businesses that suspect they may have filed erroneous claims are encouraged to correct these filings promptly to mitigate potential repercussions.
This notice serves as a critical reminder for companies to maintain diligence and seek professional advice when navigating complex tax credits to avoid compliance issues and safeguard their financial health.
July 25: IRS Expands Taxpayer Services and Online Tools with Inflation Reduction Act Funding
The IRS has announced significant expansions in taxpayer services and online tools, funded by the Inflation Reduction Act.
This initiative includes enhancements such as improved digital resources for filing taxes, new tools to track refunds, and increased support for tax-related inquiries.
The funding has enabled the IRS to reach key milestones in modernizing its infrastructure, aimed at making tax compliance more accessible and efficient for both individuals and businesses. The IRS has also expanded multilingual services to better serve diverse populations.
These developments reflect the agency's commitment to leveraging technology to streamline processes and provide comprehensive support to taxpayers, addressing both current needs and preparing for future demands.
The improvements are part of a broader effort to enhance taxpayer experience, ensure accurate and timely assistance, and support the administration's goals of increasing efficiency and transparency in government services.
July 24: Harris Tasked with Securing Biden’s Tax Policy Legacy
Vice President Kamala Harris has been assigned a pivotal role in securing the legacy of President Joe Biden's tax policy.
This responsibility involves navigating legislative challenges to implement key tax reforms aimed at increasing revenue, addressing economic inequality, and supporting critical public investments.
Harris is expected to advocate for policies such as enhanced tax credits for low-income families, adjustments to corporate tax rates, and closing loopholes that benefit the wealthiest individuals.
Her involvement underscores the administration's commitment to using tax policy as a tool for economic equity and growth.
The task also highlights the complexities of achieving bipartisan support in a divided Congress, where differing views on taxation and spending present significant hurdles. Harris' leadership in this area will be crucial in shaping the future direction of U.S. tax policy and ensuring that the administration's fiscal goals are realized.
July 23: Uncertainty Growing at IRS Over Project 2025
The IRS is experiencing growing uncertainty regarding Project 2025, an initiative aimed at modernizing its IT systems and operations by the year 2025.
The project, which is part of a broader strategy to enhance efficiency and taxpayer services, faces challenges including budget constraints, evolving technology standards, and the need for comprehensive staff training.
Concerns have also been raised about the project's timeline and the potential for disruptions to ongoing tax collection and service activities.
The IRS leadership is under pressure to balance the urgency of modernization with the practicalities of implementation, especially in light of recent funding boosts from legislative acts.
As the agency navigates these complexities, the successful execution of Project 2025 is seen as critical for improving the IRS's ability to handle increasing workloads, safeguard taxpayer data, and streamline operations in the face of growing demands and expectations.
Economic News/Policy:
July 26: House GOP Faces Internal Struggles Over Spending Stopgap
The House GOP is encountering internal conflicts as it debates a spending stopgap aimed at preventing a government shutdown.
The division arises from differing opinions within the party on the scope and duration of the funding measure.
Some members advocate for a short-term continuing resolution to maintain government operations while negotiations continue on broader fiscal policies. Others are pushing for specific policy riders and budget cuts, complicating consensus-building efforts.
The party's leadership is working to bridge these divides to avoid a shutdown, which could have significant political and economic repercussions.
The situation highlights ongoing challenges within the GOP in balancing fiscal conservatism with pragmatic governance, especially as negotiations with Democrats loom.
This internal struggle could shape the party's strategy and unity moving forward, impacting future legislative agendas and priorities.
Technology:
July 23: NSF Announces New AI Test Beds Initiative to Advance Research and Development
The National Science Foundation (NSF) has launched a new initiative to establish AI test beds aimed at accelerating research and development in artificial intelligence.
These test beds will provide researchers with access to cutting-edge computational resources, data, and tools necessary for developing advanced AI technologies.
The initiative seeks to foster collaboration between academia, industry, and government, enhancing innovation and addressing key challenges in AI such as bias, transparency, and scalability.
By supporting diverse research projects, the NSF aims to spur advancements in areas like healthcare, cybersecurity, and autonomous systems.
This initiative is part of a broader effort to maintain the United States' leadership in AI and ensure that the technology is developed in a way that benefits society as a whole. The test beds will also serve as educational platforms, helping to train the next generation of AI researchers and practitioners.
July 22: Effectively Incorporating AI into Drug Research and Development
The pharmaceutical industry is increasingly turning to artificial intelligence (AI) to enhance drug research and development processes.
AI technologies are being utilized to accelerate drug discovery, optimize clinical trials, and predict patient responses to therapies.
The integration of AI can significantly reduce the time and cost associated with bringing new drugs to market, while also improving the accuracy of predicting adverse effects and efficacy.
However, successful incorporation of AI requires careful consideration of data quality, model transparency, and regulatory compliance. Collaboration between AI experts and pharmaceutical professionals is crucial to ensure that AI applications are robust, ethical, and aligned with clinical needs.
As the industry navigates these challenges, AI holds the promise of revolutionizing drug development, making it faster, more efficient, and tailored to individual patient needs.
Energy and Environmental Policy/News:
July 26: Biden Puts $575 Million Toward Making Coastal Communities More Resilient to Climate Change
President Joe Biden has allocated $575 million to bolster the resilience of coastal communities facing the threats of climate change.
This funding will be directed towards infrastructure enhancements, restoration of natural barriers, and community resilience planning.
The initiative aims to protect vulnerable areas from the escalating risks associated with rising sea levels and extreme weather events, such as hurricanes and flooding.
By focusing on proactive measures, the administration seeks to safeguard both human populations and critical ecosystems, thereby ensuring the sustainability and safety of these regions.
This investment is part of a larger strategy to adapt to and mitigate the effects of climate change, underscoring the administration's commitment to addressing environmental challenges and supporting affected communities.
July 26: Updated FAQs on Clean Vehicle Credits Released by the IRS
The IRS has published updated Frequently Asked Questions (FAQs) regarding tax credits for new, previously owned, and qualified commercial clean vehicles.
This update aims to provide clearer guidance on eligibility criteria, credit amounts, and the application process for individuals and businesses considering clean vehicle purchases.
The FAQs address specific issues such as the definition of qualified vehicles, documentation requirements, and the timing of credit claims.
This initiative is part of broader federal efforts to promote environmentally friendly transportation options and reduce carbon emissions.
The IRS encourages taxpayers and industry stakeholders to review these updates to better understand the benefits and requirements associated with clean vehicle credits, which are a key component of the government's strategy to support sustainable economic growth and environmental stewardship.
For Fun:
July 25: NASA's Perseverance Rover Discovers Martian Rock with Ancient Life Clues
NASA's Perseverance rover has made a significant discovery on Mars, uncovering a rock that may hold clues to ancient life.
The rover, equipped with advanced scientific instruments, analyzed the rock's composition and found signs of organic molecules, which are the building blocks of life.
These findings are part of a broader mission to explore Jezero Crater, an ancient lake bed believed to have been habitable billions of years ago. The discovery adds to the growing evidence of Mars' potential to have supported microbial life in its distant past.
NASA scientists are excited about the implications of this finding, as it enhances our understanding of the Red Planet's history and its capacity to harbor life.
Further analysis and sample collection are planned, with hopes of eventually bringing Martian samples back to Earth for more detailed study.