addressing the impact of covid-19
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COVID-related items to keep in mind
COVID has provided some unique challenges to CPA firms and their clients. Here are additional items to keep in mind this tax season.
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Ask clients about tax-related COVID relief, including:
  • If EIPs and/or Advance Child Tax Credit payments were received;
  • If the client benefited from the ERC;
  • The status of any loan or debt forgiveness, including the Paycheck Protection Program and student loan forgiveness;
  • If other benefits were received from federal, state or local governments or non-profit or for-profit organizations; and
  • Other benefits of the American Rescue Plan Act, such as above-the line charitable contributions.
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Remind clients that they will need to remit payroll taxes deferred under the CARES Act no later than December 31, 2021 and December 31, 2022.
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Notify individual and business tax clients with “COVID homes” of potential additional filing obligations and tax effects. What’s a “COVID home”? Who needs to be notified? Read the Risk Alert “COVID Homes” Create Professional Liability Risk for CPA Firms for information on how claims may arise. Consider sending a notification letter to affected individuals. AICPA Tax Section members are able to receive a sample letter.
Fortify the firm’s data security protocols as remote working is likely to be more prevalent in the future. Consider establishing a virtual private network (VPN) if one is currently not in place. Remind all firm personnel of existing data security policies and revisit these policies if updates are needed. Establish a secure portal to permit clients to safely transmit information to the firm. Data Security Tips to Help Weather a Pandemic outlines additional considerations and recommendations as well as Don’t get victimized by a cybercriminal.
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