TOP THREE TAX QUESTIONS

Uncertainty may be the only thing we're certain of right now. To help quash some of your concerns (and help more people more efficiently), we're starting this new weekly email of "Last Week's Top 3 Questions". Without further ado:

Here are the Top Three Tax Questions that flooded our inboxes last week...

QUESTION #1:

We know that it's been a challenging time for many of you. Some self-employed individuals are finally getting approved for the extended unemployment benefits via MN Unemployment (after weeks of struggling). If you still need to apply, there are great step-by-step instructions here. If you applied before they updated their site to facilitate self-employment, you may still be stuck in limbo; we suggest you call MN Unemployment to attempt to resolve it, rather than mail, fax or wait--they are very overwhelmed and it seems that only the squeaky wheels are getting greased.

For those of you who HAVE begun getting benefits, you need to report any earnings each week, which is a bit more complicated when self-employed. You are allowed to deduct direct operating expenses from your weekly earnings (and it's money earned each week, not money received, so you have to report it when you do the work, not when you get paid). Here is a detailed description of what you can deduct from weekly earnings before reporting the net income each week.

QUESTION #2:

Many business owners have been receiving PPP loans (after a chaotic start to SBA funding/guidance on applications). We are now getting tons of questions on what to do next, how to track things and what will be forgiven. This one question is really more of a grouping of 50 questions. Nothing about this program is simple, so here are some links/tools to help:

Overview of the entire program: Answers to many general questions.
Loan Forgiveness Calculator: Download or duplicate to customize and estimate your loan forgiveness. Watch how forgiveness drops if you decrease Employee numbers in Cell C62 and see note** regarding rehiring by June 30th.
How do I track spending?: Our suggestion is to set up a separate bank account, but don't spend directly from it (no need to switch payroll bank); instead, keep a folder of receipts and a spreadsheet like this one and transfer money to your business checking to reimburse each expense.
AICPA FAQ: TONS of other questions and their answers. The Loan Forgiveness section is great (scroll way down on the page to find it!)

QUESTION #3:

No. But, we can tell you that you're not alone. If the IRS site isn't working or is telling you "Payment Status is Unavailable", you have plenty of company. If you haven't filed your 2019 taxes and can't get their tool online to work using 2018 tax info, we don't have any other magic way to help you update your bank details.

What we CAN do is help you to file your 2019 tax return and include your bank information on that filing. That's your best option to get direct deposit set up if their online tool isn't working for you. So feel free to fill out our Tax Organizer, upload your info to our Online Portal and and we'll get started on your 2019 tax return!

If you have other questions on the stimulus checks, the IRS has an extensive FAQ here.

Thanks for sticking with us through this.
We hope you're all doing your part to stay healthy and hopeful and home. We're getting much larger volumes of questions than ever before, so we apologize if our response times have slowed. We're going to try and send one of these every Monday to help answer your questions--or just to let you know that you're not alone in your confusion during these strange times.

We ask that you review our Newsletter Archives and Special COVID-19 Links sections before emailing us with questions. We're doing our best to update these resources as fast as we can and they are your best place to find our most up-to-date info. If you still have questions, please do email your tax preparer; however, if your answer is not a simple one, consulting fees may apply for our time and research.

-- Mark, Alyssa and The Fox Tax Team

MN DEED GUIDE FOR SMALL BUSINESSES

NEWSLETTER ARCHIVE

ADDITIONAL LINKS / RESOURCES

Please check the links above often as we are updating them daily!