BREAKING NEWS – Corporate Transparency Act on Hold
as of Monday, March 3, 2024
On Friday March 1, 2024, the U.S. District Court for the District of Alabama declared the Corporate Transparency Act (CTA) unconstitutional. In the case of National Small Business Association v. Yellen (Case No. 5:22-cv-01448) [1], initiated by the National Small Business United, the challenge was against the CTA’s mandate for small businesses to disclose their beneficial owners to the Financial Crimes Enforcement Network (FinCEN).
The ruling has the effect of suspending all BOI filing requirements for now, all enforcement actions, and all compliance concerns including questions of “practicing law without a license.” Experts believe the ruling will be appealed, probably to the Supreme Court, so this is a temporary filing requirement suspension until a final appeal is exhausted. Voluntary filing appears to still be allowed if for some reason a client desires to file.
Three New IRS Tools for 2021 Child Tax Credit Advance Payments
The IRS recently launched three new online tools (links below) to help eligible Americans claim and manage their advance payments of the 2021 Child Tax Credit (CTC). In addition to increasing the maximum CTC amount and raising the age limit for qualifying children, the American Rescue Plan authorized the IRS to send monthly advance payments of the 2021 credit to millions of eligible families beginning in mid-July.
The Child Tax Credit Eligibility Assistant helps families find out whether they qualify for the 2021 CTC. You do not need to set up an IRS online account in order to use this tool. Just answer 2-5 questions about whether you claimed the CTC in 2019 or 2020, where you live, and, in some cases, your tax filing status, family size and income. If the tool determines that you may qualify for the credit, you can follow the MANAGE YOUR ADVANCE PAYMENTS link to make sure you are enrolled to get monthly payments by check or direct deposit beginning in July.
The Child Tax Credit Update Portal provides additional information on eligibility for the 2021 CTC. However, in order to use it, you must either have an IRS online account, or go through an identity verification process. Once you determine that you are eligible, you can use this tool to:
- Unenroll from the program (for example, if you qualified for the CTC in 2019 or 2020 but do not expect to qualify in 2021 due to a family status or income change)
- Opt out of receiving advance payments, and instead receive your 2021 credit as a lump sum when you file your tax return
- Update your mailing address, family size, banking information for direct deposit, etc.
Most eligible families do not need to take any action, and will automatically receive monthly advance payments of the 2021 CTC from July through December. However, if you qualify for the credit but did not file a 2019 or 2020 tax return, you may need to register for this program using the Non-Filers Signup Tool. If you qualified for the CTC in past years but did not claim it, your tax professional can help you file an amended return and perhaps receive an IRS refund for the credit.
CTC Eligibility Assistant:
https://www.irs.gov/credits-deductions/advance-child-tax-credit-eligibility-assistant
CTC Update Portal:
https://www.irs.gov/credits-deductions/child-tax-credit-update-portal
Non-Filers Signup Tool:
https://www.irs.gov/credits-deductions/child-tax-credit-non-filer-sign-up-tool