On December 27, 2020, President Trump signed into law the Consolidated Appropriations Act, 2021 which included measures for both COVID-19 relief and sweeping funding provisions for the government through September 2021. While there are many sections of this law to explore, this article will focus on the stimulus checks.
Qualifying individuals will receive these economic impact payments, and the Washington Post reports that more than 85 percent of US households will receive a check. To qualify:
- For individuals making up to $75,000 per year, or if a couple, making up to $150,000 per year, the check will be $600.
- For individuals making between $75,000 and $86,900 (couples: $150,000 to $173,900), the check will be between $595 and $5. In this phaseout, the amount of the check decreases by $5 for every $100 of income above $75,000/$150,000, phasing out completely at $87,000/$174,000.
- The amount sent will be based on the amount you earned (adjusted gross income, to be exact) on your 2019 tax return.
- Includes children. The definition for child will be the same as the one used to calculate the child tax credit.
- Excludes dependent adults over 17 at the end of the tax year.
- Excludes persons who died on or before January 1, 2020.
- Includes individuals who file jointly with an ITIN, but excludes the person with the ITIN.
- Includes 2019 non-filers who receive benefits from Social Security Administration, Railroad Retirement Board, and the Department of Veterans Affairs.
Here are some examples: A family of four – mom, dad, and two children under 17 – that earns a total of $100,000 per year will receive $2,400. A single man earning $80,000 per year that lives with his disabled father will get $350 (80,000 – 75,000 = 5,000 / 100 = 50 * $5 = $250. $600 – $250 = $350). A woman with 2 small children earning $87,000 will not get anything.
Taxpayers do not have to do anything to receive their stimulus checks. Many taxpayers will receive their stimulus checks via direct deposit, if that information was included on your 2019 return. If the IRS does not have your bank account information, you will likely get a check or a pre-paid debit card. If you’ve moved, you can update your address by completing an IRS change-of-address form (allow six weeks).
The checks are supposed to start hitting bank accounts early in January. You do not have to pay tax on this income.
If you never got the first stimulus check, you can claim it on your 2020 tax return. Details are here on the IRS site. https://www.irs.gov/newsroom/recovery-rebate-credit
One of the biggest tax issues of 2020 has been clarified with the signing of the Consolidated Appropriations Act, 2021, (CAA 2021), and that was whether expenses that are normally deductible and that were paid with the proceeds of a Paycheck Protection Program (PPP) loan that is forgiven are truly deductible.
The CARES Act, which became law on March 27, 2020, was drafted so quickly that the question of deductibility was left out, but several members of Congress made it clear that deductibility was the intent all along. The IRS went the other way, publishing a notice (2020-32), a revenue ruling (2020-27), and a revenue procedure (2020-51), that took the opposite stance: PPP-related expenses that were forgiven were not deductible, therefore potentially causing business’s taxes to become much higher.
Congress has now reversed the IRS’s position with CAA 2021 in Section 276 (PPP) and 278 (EIDL). Gross income does not include forgiveness of PPP loans and emergency EIDL grants. Deductions are allowed for normally deductible expenses paid with PPP loan proceeds that were forgiven. It also provides deductibility for Second Draw PPP loans. This is all good news for taxpayers with PPP loans.
However, there could be timing issues that could reduce the deductibility of the full amount of the PPP expenses. There could also be amounts “at risk,” which is a tax term that limits your deductions in certain cases.
All of these issues need to be carefully considered on a case-by-case basis. Your tax professional is your best source to help you review all of these factors so that both your PPP loan forgiveness and allowable deductions are timed to reduce your tax bill.
Year-end is the perfect time to reflect on accomplishments achieved and lessons learned over the past year. It’s also an important time to put things into perspective as we turn the page and start a new year.
What We’ve Learned
With so much change in 2020, the opportunities to learn have been abundant. Take a moment and contemplate the following:
- What new skills did you learn this year?
- What topics did you become wiser about?
- What situations have you learned to master?
If you set goals for 2020, which ones did you achieve? Because it was a volatile year, you may have achieved a lot of things that were not planned. Or you may have simply maintained status quo, which is an amazing accomplishment in 2020. Give yourself credit for that.
As we transition to 2021, set new goals to be achieved in your business and personal lives and record the list so you can look back periodically to monitor your progress.
Gain perspective by reflecting and asking yourself these questions:
- What kind of person do I want to be in 2021?
- How do I see myself in five years?
- What can I contribute?
Reflect, plan, and gain perspective as we usher in 2021. And have a Happy New Year!
Now, more than ever before, the act of listening is important. The power of listening—effective listening—will help you get more information from customers, increase their trust and commitment in you, and reduce conflict and misunderstanding.
What It Means to Listen
It is important to point out that the act of listening and actually comprehending what a person is saying can lead to strong, healthy, and thriving relationships—all very important qualities in any type of relationships, specifically a business one.
If you don’t believe us, think about the last time you were having a conversation with someone and felt as if you weren’t being heard. How did that make you feel? How did that affect the relationship? Did it make you feel valued?
According to Dr. Carl Rogers, a psychologist, active listening is a specific communication skill. Giving free and undivided attention to a speaker through active listening is the most effective way to achieve individual change and group development.
Tips on Becoming a Better Listener
If you truly want to become a better listener, then consider implementing these tips into your daily life.
- Understand the Benefits
First, it’s imperative to understand that listening to someone is beneficial to both the person doing the talking and you. Nothing bad or negative comes from listening to another person speak, but the complete opposite. Remember, if you thoroughly listen to an individual, it’s more likely that same individual will listen to you when it becomes your turn to speak. The partnership the two of you are hoping to grow can only be successful with mutual listening.
- Make Eye Contact
Next, when someone is speaking to you, always make eye contact. This tactic not only shows respect, but it will also help you focus on the other person’s words, what he or she is saying and how they feel.
- No Distractions
When sharing a conversation with someone, make sure there are no distractions. Obviously, this means you need to put down your phone and give the speaker your full attention. Don’t worry about what’s going on around you; don’t think about your next meeting or what you plan to have for lunch. Listen, engage, and show the person talking that you care.
- Ask Questions
One of the best ways to show the speaker that you are really listening to them, is to ask them questions. Make sure you fully understand what they’re saying by verifying their wants, needs, and/or concerns with specific questions.
Remember, nothing bad comes from listening—only good. The next time someone is speaking, consider opening up your eyes, ears, and mind just a little bit more. In doing so, you will gain the full benefits of the power of listening.
It goes without saying that 2020 has been quite the year—and it’s not even over yet! Of course, any one of us could easily come up with a long list of every bad occurrence that has taken place since March due to the pandemic. Being grateful can be challenging during times of hardship, and we want to help you achieve the feat.
Below, we’ve put together different techniques to help you see that there are many things to be grateful for, both in our business and personal lives. This is a great time of year – just before Thanksgiving – to stop and practice gratitude.
What Are You Grateful For?
The act of being grateful can lead to experiencing positive emotions. As a matter of fact, if you are experiencing negative emotions and don’t want to, the fastest way to “reset” your physiology is to start thinking of things you are grateful for.
Here are some ideas to help get you started:
Health comes in many various forms; the idea of being healthy can mean something entirely different to two people. Consider what being healthy means to you, and then, if you do think you have your health, try and be grateful for it.
One good thing about the pandemic is that most people are eating more healthful, home-cooked meals and less fast food, and they are feeling better with more energy. People are also watching their weight and even losing excess pounds, especially after some of the initial reports that overweight people were having a harder time fighting Covid-19 than slimmer people.
Friends and Family
Are you surrounded by loved ones? Now, more than ever before, it’s important to be grateful for people who are in your life. You may be facing hardships but think how much more difficult times would be if you were dealing with them by yourself. Be grateful for having someone in your life that you can lean on.
Work and Business
So many people have lost their jobs, their income, their sense of security. If you still have work or your business to keep you busy, focused, and earning a steady paycheck, be grateful. It’s a wonderful exercise to express your gratitude to your customers, coworkers, or employer by writing them a thank you note or leaving them a review on Google My Business, Yelp, their Facebook business page, or their LinkedIn profile as a recommendation.
Similarly, it’s the perfect time of year to ask your customers or employer to leave you a review on one of these digital assets.
Never Stop Being Grateful
Of course, there are plenty of other things to be grateful for in this world; everyone’s list will look different. Perhaps you’re grateful for a pet or something you’ve achieved. Maybe the fact that you have a special skillset or the ability to be patient and understanding during trying times gives you reason to smile.
That’s the thing about being grateful: there is nothing too big or too small to be grateful for; no right or wrong answer. And while it may feel more difficult this year compared to others, you can always find something when you look hard enough.