Tax and Finance Management

IRS Provides Expanded FAQs on Employee Retention Tax Credit

The IRS has issued expanded FAQs for the employee retention tax credit. The FAQs cover employer eligibility, allocation of qualified health plan expenses, interaction with other COVID-19 relief provisions and more. Here is more information on this temporary, refundable payroll credit. 4/30/2020

Fight Intensifies Over COVID-19 Business Interruption Coverage

In its recent analysis, OMA Connections Partner Jones Day writes, “In an ongoing effort to discourage commercial policyholders from pursuing COVID-19-related business interruption claims, the insurance industry continues to issue sweeping pronouncements of alleged ‘no coverage’ for such losses.” According to Jones Day, policymakers in several states have issued orders and proposed legislation that may be of assistance in holding property insurers accountable for their COVID-19 coverage obligations. 4/29/2020

Proposed Regulations Issued on Unrelated Business Taxable Income

Last week, the U.S. Department of the Treasury and the IRS issued proposed regulations under Section 512(a)(6), which was enacted by the Tax Cuts and Jobs Acts of 2017. Among other things, this section provides that losses from one unrelated trade or business cannot offset the gains from another. Comments on the proposed regulations are due by June 23, 2020. For more details, see this report for OMA Connections Partner Crowe. 4/30/2020

Additional PPP Guidance for Seasonal Employers

Under the federal Paycheck Protection Program (PPP), there are unique requirements for seasonal employers to determine their payroll costs. The Treasury Department this week released an Interim Final Rule to provide additional relief for these employers. Read insight from OMA Connections Partner CliftonLarsonAllen. 4/29/2020

Husted: State’s Rainy Day Fund Will Fall Well Short of What’s Needed

During the governor’s COVID-19 press briefing on Wednesday, April 22, Lt. Gov. Jon Husted told reporters that Ohio’s $2.7 billion Budget Stabilization Fund will be insufficient to balance the state budget over the next 15 months. It will likely require twice that amount to recover the state’s expenditures during the emergency, he said.

Gongwer News Service reports that Senate President Larry Obhof (R-Medina) has said he expects the General Assembly to act on some sort of budget correction measure before the summer. 4/22/2020

Ohio Sales Tax on Internet Access Becomes Illegal on July 1 Under Federal Law

On July 1 of this year, sales taxes levied on internet access in six states — including Ohio — will become illegal under the provisions of the federal Permanent Internet Tax Freedom Act (PITFA).

The Tax Foundation reports that the 1998 law included a grandfather clause that allowed states with taxes existing before 1998 to keep that tax in place until June 30, 2020. 4/20/2020

Guidance on COVID-19 Tax Relief

The IRS recently issued guidance significantly expanding relief from tax filing and payment deadlines available to tax-exempt entities in response to the COVID-19 pandemic. OMA Connections Partner RSM has published this alert to describe the new guidance. Check out RSM’s COVID-19 Tax Relief Resource Center. 4/17/2020

Ohio’s Unemployment Insurance Fund Could be Depleted in Two Months

While discussing the Unemployment Insurance (UI) Trust Fund during the governor’s April 15 COVID-19 briefing, Lt. Gov. Jon Husted said that without federal assistance, the fund is expected to be insolvent “sometime in June.” He said the administration would work with the General Assembly on how best to address Ohio’s UI fund, which had the nation’s fifth-worst solvency rate according to a federal report released earlier this year.

During the Great Recession of 2008-09, the state was forced to borrow $3.4 billion from the federal government — resulting in more than $200 million in interest on the loan. 4/15/2020

Ohio Ranked Among Top States for Taxpayer ROI

According to a new study, Ohio ranks among the top states for taxpayer return on investment in 2020. Financial website WalletHub contrasted state and local tax collections with the quality of the services residents receive in each state across 30 metrics in five categories: Education, health, safety, economy, and infrastructure and pollution. When all the factors were considered, the Buckeye State was the sixth-best state for ROI on its tax dollars. 4/15/2020

IRS Guidance on COVID-19 Credits for Employers

Many businesses that have been severely impacted by the COVID-19 pandemic will qualify for two new employer tax credits from the federal government: the Credit for Sick and Family Leave and the Employee Retention Credit. For more information, see the IRS’ guidance page regarding these new employer credits. 4/6/2020