Taxpayers who have qualifying children under the age 18 at the end of 2021 can now get the full credit if they have little or no income from a job, business, or other source. Prior to 2021, the credit was worth up to $2,000 per qualifying child, with refundable portion limited to $1,400 per child. It has been increased to as much as $3,000 per child ages 6 – 17 at the end of 2021, and $3,600 per child ages 5 and under at the end of 2021.

The maximum credit is available to taxpayers with a Modified AGI of:

1. $75,000 or less for Single and Marries Filing Separate filers
   
2. $112,500 or less for Head of Household filers
   
3. $150,000 or less for Married Filing Joint filers

From July 15 through December 2021, the IRS will advance 50% of the 2021 child tax credit in monthly payments to eligible taxpayers. The monthly payment will be estimated from their 2020 tax returns. The remaining amount will be claimed on their 2021 income tax return.

If you did not file a tax return during 2020 you can use this tool to report qualifying children for 2020 non-filers:  https://www.irs.gov/credits-deductions/child-tax-credit-non-filer-sign-up-tool

Taxpayers may elect to opt-out from the monthly child tax credit payments to receive a large payment next year instead of seven smaller payments. This could be the case for families saving up for a big expense or those who have budgeted for that money to pay off outstanding debt. Also, your household circumstances or tax situation will change and don’t want to deal with having to update your information in the portal.

Taxpayers may opt-out use the Child Tax Credit Update Portal by July 1.

The Research & Development tax credit allows companies to claim a tax credit for qualifying research expenditures. If your company has invested in R&D, you may benefit from this tax credit.

The Arkansas Secretary of State is once again collecting franchise taxes for all companies registered with the State of Arkansas. Due to the recent transition of franchise taxes from the Department of Finance and Administration back to our office, Secretary of State John Thurston has waived the penalty and interest on 2021 franchise taxes until July 15th.

The Arkansas Department of Finance and Administration has announced that effective March 15, 2021, all franchise taxes will go back to being paid to the Secretary of State. Franchise tax filing/payment through Arkansas Taxpayer Access Point (ATAP) who took on the role on January 1, 2021 no longer will be available beginning March 12, 2021 at 3:00 a.m. The Secretary of State will continue to be the first point of contact when starting a new business in Arkansas as well as any activity related to the organizational structure of an entity.

In a News Release, IRS has announced that tax season will start on Friday, February 12, 2021, when the tax agency will begin accepting and processing 2020 individual income tax year returns. It also provided additional filing season date information.

IRS said that the February 12 start date for individual tax return filers allows IRS time to do additional programming and testing of IRS systems following the December 27 tax law changes that provided a second round of Economic Impact Payments and other benefits.

In March 2020, the FFCRA (Families First Coronavirus Response Act) required employers with fewer than 500 employees to provide paid sick and family leave to employees affected by COVID-19 and provided affected employers with a corresponding employment tax credit.

Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels. If employers did not maintain employee count or salary levels, forgiveness will be reduced. When the Flexibility Act was released on June 5, 2020, the loan forgiveness form and instructions were updated to include several measures to reduce compliance burdens and simplify the process for borrowers, including:

Arkansas Congress has approved an additional $55 million free grant program to help get through the COVID-19 pandemic.  These funds are for personal protective equipment, hand sanitizer, deep cleaning, and other expenses related to protecting employees from the COVID-19 virus.

This will be a first come first serve application; however, unlike last week the applications will stay open for a full two days (Tomorrow and Wednesday).

The grants are for $1,000 per employee, a maximum of 100 employees.

The website link is:

https://www.arkansasedc.com/covid19resources/business-resources/ready-for-business-grant-program/While it says unavailable at the current moment it will become available at 8:00 am tomorrow.  I encourage you to go ahead and follow the link to review the required information and grant guidelines.

VIEW GRANT PROGRAM OVERVIEW

If this is something you feel that will benefit your Company I encourage you to apply early to increase your chances of receiving a grant.  Please let us know if you have any questions.

Thank you,

Allen

Tax Deadline is May 1^st; Late Fees and Interest Waived Until July 15^th

Arkansas Secretary of State John Thurston announced today that late fees and interest charges on businesses’ annual franchise taxes will be waived until July 15^th. The filing deadline for annual franchise taxes is May 1^st. Typically, companies filing after the deadline are charged a $25 late fee plus 0.000274% interest per day the payment is delinquent. These penalties will be waived for those who file between May 2^nd and July 15^th.  This only applies to the 2020 franchise tax reporting year.

Secretary Thurston said, “The May 1^st deadline is set by state law, however, we thought this would be one way to help companies who may need a little extra time to get their tax payments in order. The ongoing COVID-19 pandemic is having a serious impact on our business community and we want to help them in any way that we can.”

The Secretary continues to work closely with all stakeholders and coordinated these efforts with those of the Governor’s Office and the Department of Finance and Administration.

Arkansas franchise taxes can be filed conveniently online at https://www.ark.org/sos/franchise/index.php.

WASHINGTON, DC – Today, the U.S. Department of Labor’s Wage and Hour Division (WHD) announced more guidance to provide information to workers and employers about how each will be able to take advantage of the protections and relief offered by the Families First Coronavirus Response Act (FFCRA) when it takes effect on April 1, 2020.