Congratulations to our NEW Supervisors

Congratulations to all our employees that were promoted to Supervisor at our recent State of the Firm!

From left to right, A&A Department: Jessica Gesselman, Drew Zuckerman, Laura Boden, Mitchell Meurer. Tax Department: Adam Caldwell, Esme Allen, Diane Claybon, Seth Ferguson, Susan Theising. Outsourcing Department, Client Accounting Implementation Expert: Jeremy Wann. Marketing Department: Senior Marketing Coordinator: Leslie Wight.

We are so grateful to our hard working team! Congratulations to all!

HSC Announces Summer Hours

Harding, Shymanski & Company, P.S.C. Offices will close at Noon local time on Fridays starting May 22nd and continuing through the Labor Day holiday.

“Our employees work hard year-round, and especially this year’s busy season has been particularly challenging as we help our clients navigate the changing business landscape due to the coronavirus pandemic,” said Scott Olinger, CEO. “We offer this alternative schedule in acknowledgment of the team’s commitment to serving our clients.”

Regular Friday office hours of 8:00 a.m. to 5:00 p.m. will resume on Friday, September 11th.

 

Retirement Plan Considerations During COVID-19

Some common retirement plan questions and concerns that we are receiving:

  • Can we stop contributions?
  • Can we delay funding our plans?
  • Are furloughed employees considered terminated?
Quick answers include:
  • Discretionary contributions can stop;
  • Safe harbor contributions may be delayed or amended to stop if you follow certain procedures;
  • Loans, hardship distributions, in-service payments may be expanded;
  • Furloughed employees are not terminated; only terminated employees can receive their vested balances;
  • Pension due dates have not yet changed:
    • 7/31/20 for 5500s and extensions to 10/15/20 for calendar year plan;
    • 9/15/20 for funding benefits and 2019 deduction;
    • 12/31/20 finishing all outstanding issues for 2020
Keep in mind:
  • If a plan moves out of safe harbor, it may have to deal with top heavy issues and other compliance testing failures;
  • Participants can stop their deferrals at any time, even if starting and modifying elections is according to a schedule;
  • Terminating more than 20% of the workforce could be a “partial plan termination” with affected employees advancing to 100% vesting;
  • Don’t do anything without checking the plan document;
  • Remember, employees asking for money are going to be hurt more as the stock market continues to drop;
Patience is a virtue:
  • How many times do you want to do a plan amendment to give or take away a feature;
  • Lowering cash balance formulas is a more extreme move when the IRS only wants to see formula changes not more than every 3 years, or so;
  • Fiduciary considerations overshadow everything;
  • In a few years, we don’t want to be in DOL lawsuits for taking action now when no action is taken when everything gets back to normal
Adapted from article by:

Michael S. Miller, CEBS
Apex Pension Strategies, Inc.
Atlanta, GA 30356

Nonessential Retailers Closed in Kentucky

Gov. Andy Beshear issued an Executive Order that all in-person retailers that are not life sustaining should be closed as of Monday, March 23rd at 8:00 p.m.

Life-sustaining retail businesses that will stay open include grocery stores, pharmacies, banks, hardware stores, gas stations and other businesses that provide staple goods. A full list of categories of life-sustaining, in-person retail businesses is attached to the order.

Click here to read the Executive Order.

Kentucky has opened a COVID-19 hotline lines are open from 7:30 a.m. to 9:00 p.m.

1-833-597-2337.

IRS is Giving You a Free 3 Month Loan in Order to Keep More Cash in the Economy

Updated March 24, 2020 

The IRS issued Notice 2020-18 on March 20th, extending the due date and payment date for all federal income taxes and income tax returns to July 15th.  The notice specifies that this includes self-employment taxes, but does not apply to excise taxes, estate tax, etc. Notice 2020-18.

Various states are adopting this extension of time to file and pay, but with varying details.  The AICPA is continuously updating a chart showing each state’s conformity to the federal law along with extensions of other state and local taxes. Click here to read the chart.

Please contact Kathy Ettensohn at kettensohn@hsccpa.com or Mike Vogel at mvogel@hsccpa.com if you have questions about how these evolving provisions apply to you.

Original March 20, 2020

At least for your federal balance due. The Treasury department announced today that the filing deadline for federal taxes has been moved to 7/15. Previously, only the due date for payments was moved to 7/15, as opposed to the actual filing of returns. We are waiting for official guidance from Treasury that will provide more details around this new announcement. There are still open questions regarding state filing requirements as well as quarterly estimates that are due June 15th. We will send an update as information becomes available.

SBA Announces Disaster Assistance Loan Program

US Small Business Administration Logo

Updated March 23, 2020

All US States are now eligible for SBA disaster loans.

Updated March 20, 2020:

States currently eligible for SBA disaster loans

Arizona, California Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Illinois, Indiana, Louisiana, Maine, Maryland, Massachusetts, Michigan, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, Tennessee, Utah, Virginia, Washington, West Virginia

In Addition, the Following Kentucky Counties are also listed as eligible:

KENTUCKY Contiguous Counties due to Illinois
Ballard, Crittenden, Livingston, Mccracken, Union

KENTUCKY Contiguous Counties due to Indiana
Boone, Breckinridge, Carroll, Daviess, Gallatin, Hancock, Hardin, Henderson, Jefferson, Meade, Oldham, Trimble, Union

KENTUCKY Contiguous Counties due to Ohio
Boone, Boyd, Bracken, Campbell, Greenup, Kenton, Lewis, Mason, Pendleton

KENTUCKY Contiguous Counties due to Virginia
Boyd, Lawrence, Martin, Pike

KENTUCKY Contiguous Counties due to West Virginia
Boyd, Lawrence, Martin, Pike

Original post:

On March 12th the U.S. Small Business Administration announced that it will provide disaster assistance loans for small businesses affected by the coronavirus outbreak in designated states and territories. Jovita Carranza, SBA Administrator, stated in a press release that the SBA “will work directly with state governors to provide targeted, low-interest disaster recovery loans to small businesses that have been severely impacted by the situation.” The SBA’s Economic Injury Disaster Loans would offer up to $2 million in assistance through low-interest loans for working capital to small businesses suffering substantial economic injury as a result of the Coronavirus (COVID-19).

According to the SBA statement: “These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. The interest rate is 3.75% for small businesses without credit available elsewhere; businesses with credit available elsewhere are not eligible. The interest rate for non-profits is 2.75%.”

For more information, read the full article or contact Kyle Wininger, CPA, CICA, CVA, CFE at kwininger@hsccpa.com.

Will You Qualify for the New Pass-Through Deduction?

If your rental real estate is being treated as a trade or business, in order to receive the QBI deduction, be sure that Forms 1099 are filed for all required recipients.

The recent Tax Cuts and Jobs Act introduced the new Qualified Business Income (QBI) deduction. This allows certain trades or businesses, subject to limitations, to deduct 20% of business income.

The final regulations offer unclear rules as to determining whether a rental real estate activity qualifies as a trade or business for QBI purposes. The regulations state that one factor in treating a rental activity as a trade or business for QBI purposes is whether the taxpayer complies with the requirements of information reporting. This requires the taxpayer to file Forms 1099 for all required recipients.

Form 1099-MISC would be required to be sent to any non-corporate service provider (lawn service, maintenance, repairs, etc.) that was paid at least $600 in 2019. 2019 Form 1099-MISC returns are due to the recipient AND IRS by January 31, 2020. Penalties apply for each failure to file a timely return and each failure to furnish the recipient’s taxpayer identification number. The penalties that can be levied for unreported or incorrectly reported information returns may exceed the benefit received from the QBI deduction.

Tax Clerical Internship

We are currently seeking Sophomore and Freshman college students for Tax Clerical Internships in our Evansville Office. This internship is the perfect way to get your foot in the door and could potentially lead to a Tax Internship, and even full-time employment!
 
The internship will begin in January and extend through April 15th, averaging 20 hours a week. We will be flexible with your school schedule!
 
To apply for this position, please email your resume and spring school schedule to mcox@hsccpa.com.

U.S. Department of Labor Issues Final Overtime Rule

The U.S. Department of Labor announced a final rule to make 1.3 million American workers eligible for overtime pay under the Fair Labor Standards Act (FLSA).

“For the first time in over 15 years, America’s workers will have an update to overtime regulations that will put overtime pay into the pockets of more than a million working Americans,” Acting U.S. Secretary of Labor Patrick Pizzella said. “This rule brings a commonsense approach that offers consistency and certainty for employers as well as clarity and prosperity for American workers.”

“Today’s rule is a thoughtful product informed by public comment, listening sessions, and long-standing calculations,” Wage and Hour Division Administrator Cheryl Stanton remarked. “The Wage and Hour Division now turns to help employers comply and ensure that workers will be receiving their overtime pay.”

The final rule updates the earnings thresholds necessary to exempt executive, administrative, or professional employees from the FLSA’s minimum wage and overtime pay requirements, and allows employers to count a portion of certain bonuses (and commissions) towards meeting the salary level. The new thresholds account for growth in employee earnings since the currently enforced thresholds were set in 2004. In the final rule, the Department is:

  • raising the “standard salary level” from the currently enforced level of $455 to $684 per week (equivalent to $35,568 per year for a full-year worker);
  • raising the total annual compensation level for “highly compensated employees (HCE)” from the currently-enforced level of $100,000 to $107,432 per year;
  • allowing employers to use nondiscretionary bonuses and incentive payments (including commissions) that are paid at least annually to satisfy up to 10 percent of the standard salary level, in recognition of evolving pay practices; and
  • revising the special salary levels for workers in U.S. territories and in the motion picture industry.

The final rule will be effective on January 1, 2020.

For more information about the final rule, click here.

HSC Promotions Announced

HSC is proud to announce the promotion of the following individuals.

From left: Mitchell Meurer, Senior Associate, Accounting and Auditing Department.
Madeline Smith, CPA, Senior Associate, Tax Department.
Mallory Schmitt, CPA, Senior Associate, Tax Department.
David Mills, Senior Associate, Advisory Services Department.
Jeff Marx, Benefits Specialist, Outsourcing Department.
Eden Flockhart, CPA, CIA, CGMA, Senior Associate, Advisory Services Department.
Sarah Wittenbraker, CPA, Client Accounting Consultant, Outsourcing Department.
Erin Stewart, Payroll Expert, Outsourcing Department.
Brandon Medcalf, Senior Associate, Accounting & Auditing Department.