Recovery Rebate Credit and Pandemic Response Updates

The IRS recently updated its guidance on claiming the Recovery Rebate Credit and issued a report this past Friday on how it responded to the COVID-19 pandemic last year. The FAQ document on the 2020 Recovery Rebate Credit explains how taxpayers who did not receive their Economic Impact Payments or did not receive the full amount to which they were entitled, can still receive the stimulus payments. The updates now include information on Topic F: Finding the First and Second Economic Impact Payment Amounts to Calculate the 2020 Recovery Rebate Credit, more specifically, updating question 4, Topic F & adding Questions 8, 9, and 10.

In addition to this, the IRS also released a report, explaining how the IRS has been responding to the increasing demands of providing its services through all changes made around COVID. Included in this report was statistic stating that the IRS has delivered more than $1.5 trillion to people across the nation through Economic Impact Payments, tax refunds, and Child Tax Care payments.

SEC Pushes for More Transparency from Private Companies

The Securities and Exchange Commission is now looking to increase the transparency had from large private companies, as regulators’ concerns have been growing due to the increase in and little oversight surrounding private fundraising. Private capital markets have become increasingly popular, allowing for companies to acquire funding from institutions and wealthy individuals without the regulatory standards of going public.

The SEC has recently begun to formulate a plan to have these private companies report on their finances and operations in a more routine and standard way, according to a semiannual rule-making agenda and people familiar with the matter. Additionally, the SEC is also considering tightening the qualifications that investors must meet to access private markets and increasing the amount of information that some nonpublic companies will need to file with the agency.

The SEC’s push is still in its early stages but is likely to see stiff resistance from Silicon Valley and other sectors that rely heavily on funding from private capital markets.

NY Sports Betting – Tax Time

Online sports betting has recently been made legal in New York along with in-person gambling at licensed casinos in the state, this not only opens a door for potential winnings but also potential tax payments! Regardless of the source of your gambling winnings, the tax treatment of them is critical.

Winnings that surpass a certain threshold will automatically trigger a notification to the IRS, generating a W-2G form which is filled out by the payer (NY Casino, sportsbook, etc…) and indicates how much is won and how much tax was withheld from the payout. Bettors should expect to receive a W-2G if their winnings exceeded the following in New York State:

  • $5,000 or more from poker tournaments (reduced by buy-in amount).
  • $1,200 or more from slot machines or bingo.
  • $600 or more from sports betting or any pari-mutuel event (horse racing, etc.), provided the payout was at least 300 times the wager amount.
  • $600 or more from daily fantasy sports.

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