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Category: Taxes

The Texas Construction Trust Fund Act: What You Need to Know

Anyone who has ever been involved in a construction job—be it commercial or residential—is familiar with complex payment process of partial, periodic payments and the downstream flow of money from general contractors to subcontractors or others who performed the work.  Quite frequently, the money received upstream does not make it downstream.  Instead, the money is retained by the contractor, disbursed to other subcontractors, or used for other purposes.  The Texas Construction Trust Fund Act imposes serious legal consequences for such conduct. Under the Texas Construction Trust Fund Act, payments made to a contractor or subcontractor (or officer, agent, or director) under a construction contract for the improvement of real property […]

Child Tax Credit

On March 11, 2021, President Biden signed the American Rescue Plan of 2021 into law. The American Rescue Plan provides financial relief to eligible families during the final phase of the COVID-19 pandemic through the expanded Child Tax Credit. The Credit is a refundable tax credit, up to $3,600 per child, that is expected to reduce child poverty by supplementing the earnings of families receiving the Tax Credit. The Internal Revenue Service (“IRS”) has been directed to provide advance payments of half of the Credit through periodic payments commencing in the second half of 2021. Families who qualify for the Credit will receive a monthly payment for each eligible child […]

NEW M&E EXPENSE REGULATIONS for BUSINESSES

The “three martini lunch” has reappeared, as have other recent changes to the taxability of business entertainment and food and beverage expenses.  On December 27, 2020, President Trump signed the Consolidated Appropriations Act, 2021 (the “CAA Act”), authorizing a 100% deduction for certain business meal expenses for the next two years.  Prior to the CAA Act’s implementation, the Internal Revenue Service (“IRS”) issued final regulations (“Regulations”) whereby entertainment expenses were not deductible; but depending on the nature of the expense involved, meal expenses could be partially or fully deductible. Businesses have long struggled with deduction allowances for meal and entertainment expenses.  Prior to 2018, taxpayers were generally allowed to deduct […]

Important Texas Tax Updates

Employers Cannot View Unemployment Insurance Tax Rates Until February 2021 2020 brought a long list of concerns for Texas employers; one our firm hears frequently is whether an employer’s unemployment insurance tax rate will increase dramatically due to increased claims.  The Texas Workforce Commission (“TWC”) acknowledged this concern earlier this month, stating it is “explor[ing] options to keep the 2021 tax rates as low as possible for Texas employers as Texas and the entire nation continue to deal with the economic disruptions of the COVID-19 pandemic.”  The TWC further raised the Congressional relief legislation as a possible ameliorating factor for keeping tax rates low. Typically, tax rates are released in […]