NEWSLETTERS

Tax Season Update From GPW

February 5, 2021

Dear Clients,

GPW is committed to providing exceptional services while continuing to keep you and our staff safe. Following Federal and State guidance and the advice from the Centers for Disease Control and Prevention, our office remains closed at this time.

Our staff will continue to work remotely during this closure and mail will be checked daily. All face-to-face client appointments and meetings will commence virtually. We encourage our clients to provide any information to us electronically, via email or by uploading to our secure portal. If documents can’t be sent electronically, you can mail your information to our office, or drop the documents off in the box located outside our office door on the 12th floor. If you wish to use our portal, but do not have instructions on that process, please contact us and we will forward you instructions. Please note you may experience delays in processing time during the office closure.

We will continue to monitor the situation with guidance from authorities and we will contact you when the decision is made to resume normal business office hours.

On January 15, 2021, the IRS announced that it will not be ready to start accepting and processing 2020 tax returns for individuals until February 12, 2021. This delay is due to the additional time the IRS needs to do additional programming and testing of its systems following the recent tax law changes that provided a second round of Economic Impact Payments and other benefits. The IRS also announced there will be delays with accepting other types of returns such as Nonresident Alien Income Tax Returns filed using Form 1040-NR.

For California clients with businesses that received a PPP Loan in 2020, the ability to deduct expenses which qualify for forgiveness is disallowed under current California Law, in contrast to the Federal treatment of these expenses. However, in January 2021, the CA Assembly introduced a bill (AB 281) which would provide conformity to the federal law and allow for the deductions. Until there is clarity surrounding the treatment of these PPP loan expenses, we are recommending that our California business clients file an extension of their 2020 tax returns.

Due to the IRS processing delay, and with the prospect of additional legislation being passed that would directly impact 2020 returns, we anticipate more people will need to extend their returns this year to ensure we have the information necessary to prepare a complete and accurate return.

We appreciate the opportunity to work with you and are available to answer any questions or concerns you may have.

Gatto, Pope & Walwick, LLP
Certified Public Accountants