Arizona's tax experts

The Arizona Society of Enrolled Agents (AzSEA) is the professional organization of Enrolled Agents in Arizona, and the Arizona affiliate of the National Association of Enrolled Agents. Enrolled Agents are the only nationally licensed tax professionals, fully authorized to represent taxpayers before the Internal Revenue Service in all states.

Enrolled Agents provide much more than just tax preparation. They are on your side for audits and tax problems. Many provide tax planning, well before the tax return is to be filed. Some provide guidance for new business start-ups and business consulting. Some Enrolled Agents offer bookkeeping, accounting, payroll services, estate planning, financial planning, or investment services.

Foremost, Enrolled agents are tax specialists. Whether for individual or business income taxes, payroll taxes, sales taxes, personal property taxes or estate taxes, look to an Enrolled Agent for a tax expert.

Tax news for Arizona EA's

Back from the dead

The IRS has proposed reviving the PTIN user fee for next tax season. As published in the Fedral Register, the IRS estimates it will cost $50 million a year to operate the PTIN program and with an anticipated 2.4 million PTIN holders, that would work out to a user fee of about $21 per person. Public comments may be submitted until May 18 at regulations.gov.

SBA tapped out, issues guidance on CARES small biz aid

Just as the Small Business Administration announced it will not accept new applications for Economic Injury Disaster Loan (EIDL)-COVID-19 and much of the Payroll Protection Program money has already been applied for, the Small Business Administration issued a new interim final rule clarifying some aspects of the CARES aid for small businesses.

Confirmed: Self-employed should use their Schedule C profit in calculating max loan amount, substituting for gross payroll.

Guaranteed payments to partners should be INCLUDED as "payroll cost" on a partnerships PPP loan application. The individual partners should NOT file their own PPP applications as self-employed persons.

This guidance also outlines how loan forgiveness will be calculated. Read the full document here.

How to reschedule payments set for April 15

The IRS spelled out some last minute procedures for changing previously set up payments scheduled for withdrawal on Apr. 15, and other payment issues. IR-2020-70

ADOR Provides Guidance on Estimated Income Tax Payment Deadline

On Apr. 13, the Arizona Department of Revenue confirmed that while the deadline for filing and paying 2019 calendar year state income tax returns was moved to July 15, the deadline for first quarter 2020 estimated tax payments remains April 15.

Also, Arizona has not extended the date for making donations for "dollar for dollar" credits. To be claimed for 2019, they still have to be made by Apr. 15, not July 15.

Latest Coronavirus-related announcements from IRS

Economic Impact Payment: If the IRS does not have current bank information for you to be able to do direct deposit, you can provide your current bank info at https://www.irs.gov/coronavirus/economic-impact-payments. Currently, the service is available for people who have not filed a return. Within the next few days, a tool will be available to update bank info for taxpayers who have filed.

The Economic Impact Payment will not be taxable on your 2020 tax return.

June 15 estimated payment: Besides the April 15 estimated tax payment previously extended, today's the IRS has now extended relief to estimated tax payments due June 15, 2020. This means that any individual can wait until July 15 to make that payment, without penalty.

Paper returns: The IRS is not currently able to process individual paper tax returns. All taxpayers are urged to file electronically. Paper returns will be processed once processing centers are able to reopen.

Calling IRS: IRS phone lines supported by customer service representatives for both taxpayers and tax professionals are not staffed at this time. Due to staff limitations the Practitioner Priority Service line is temporarily closed until further notice. The IRS is unable to process Centralized Authorization File (CAF) requests at this time.

IRS Coronavirus news: In addition to https://www.irs.gov/coronavirus, IRS has set up a separate page for the flood of coronavirus-related news releases: https://www.irs.gov/coronavirus/coronavirus-and-economic-impact-payments-resources-and-guidance

State filing and payment deadlines

While many states have followed the IRS and pushed back their due dates for filing and payments to July 15, not all states have done so. Here's a list of deadlines by state.

People First suspends collection efforts

The People First initiative by IRS suspends most enforcement and collection activities until July 15. For taxpayers who have an installment agreement in effect, payments will be suspended until July 15 as well. For more details, look at:
-- IRS unveils new People First Initiative; COVID-19 effort temporarily adjusts, suspends key compliance program

IRS issues FAQ for FY19 filing and payment

IRS has issued an FAQ that addresses various questions about filing and payment relief eligibility. Some highlights:

-- Question 3 lists the form numbers whose filing deadlines are postponed to July 15: 1040 series, 1041 series, 1120 series and others.

-- Question 10 addresses whether the relief applies to information returns (No).

-- Question 14 addresses whether electronic funds transfer payments scheduled for April 15 move automatically to July 15 (short answer no, but you can do something about that).

-- Question 16 addresses Q2 estimated income tax payments (due date remains June 15).

-- Question 17 clarifies IRA contributions for TY19 can be made until July 15.

-- Question 22 raises the three-year statute of limitations for claims for refund (no, the "your refund is gone forever" deadline for TY16 returns remains April 15).

IRS also unveiled the "People First Initiative," suspending nearly all collection actions until July 15.

Coronavirus Tax Relief

The IRS and Arizona have extended the due date to July 15, 2020, both for filing Federal income tax returns and for payments due April 15 for individuals and other unincorporated entities.

Associated interest, additions to tax, and penalties for late payment will also be suspended until July 15, 2020. Taxpayers will not need to appy for relief from penalties and interest for payments made during this time.

The IRS established a special webpage at IRS.gov/coronavirus for tax-related information. For more information, see Tax Day now July 15 and Treasury and IRS Issue Guidance on Deferring Tax Payments Due to COVID-19 Outbreak (Notice 2020-17).

Latest IRS info:
-- Filing and Payment Deadline Extended to July 15, 2020 - Updated Statement
-- Coronavirus-related paid leave for workers and tax credits for small and midsize businesses to swiftly recover the cost of providing Coronavirus-related leave

New website for taxpayers

AzSEA has launched a new version of its website for taxpayers, TheAzTaxPros.com. It's designed to be a source of information for taxpayers and promote the EA brand. This site, AzTaxPros.org, focuses on AzSEA members and is geared toward tax professionals. Check out TheAzTaxPros.com and invite your clients to visit it.

Tax Forum presentations online

Couln't make one of the IRS Tax forums this year? The 2019 IRS Nationwide Tax Forums presentations are now online. Plus, you can earn continuing education credits for the online programs. For details, see the IRS news release.

IRS announcements & guidance

• Tax Cuts & Jobs Act (TCJA) Center
• Pub 5307, Tax Reform Basics for Individuals and Families
• 20% Qualified Business Income Deduction
• Charitable contributions and state tax credits
• Real estate safe harbor for §199A: Revenue Procedure 2019-38
• 2019-2020 Per-Diem Rates
• Virtual Currency Guidance and FAQ
• Deducting business meals: Notice 2018-76
• FAQ on 20% Deduction for Qualified Business Income
• Section 199A guidance
• 2020 tax rates, standard deductions and COLA's (Rev.Proc. 2019-44)
• Retirement plan contribution limits (Notice 2019-59)
• Standard mileage rates
• Discharged student loans (Rev.Proc. 2020-11)

AZ passes conformity at last

In the “better late than never maybe” category, the Arizona legislature passed conformity to the federal tax code at the end of May. The law, HB 2757, fully conforms Arizona to the federal tax reform law retroactively to 2018. The conformity for 2018 created an estimated $155 million windfall for the state, which the state is keeping. For 2019, tax brackets and numerous other changes attempt to restore the tax situation to close what Arizona’s tax burden was before than reform conformity. For more info:

• Legislative Fact Sheet

• Joint Legislative Budget Committee Staff Memorandum

Final regulations issued for charitable contributions and state tax credits

IRS finalized the regulations for taking federal charitable contribution deductions when those contributions receive a state tax credit. The regulations provide exceptions for dollar-for-dollar state tax deductions and where tax credits of no more than 15 percent of the amount given.