2021

The OECD’s new emphasis on aligning profits with value creation through the conclusion of the BEPS Action Plan has resulted in an ever-growing number of companies facing the challenge of preparing documentation that includes detailed value chain analyses and justifies transfer pricing (TP) policies.

Health Savings Accounts (HSA) have become increasingly more popular choices for both employers and individuals as they look to offset the rising costs of healthcare and insurance premiums. In fact, according to the 2020 Midyear Devenir HSA Research Report, the HSA market will approach 35 million accounts by the end of 2022, holding over $100 billion in assets.

Since the introduction of the Global, Intangible, Low-Taxed Inclusion (“GILTI”) in the 2017 Tax Cuts and Jobs Act (“TCJA”), taxpayers have eagerly awaited the Treasury’s position on whether the High Tax Exception Election (“HTE Election”) under IRC §954(b)(4) would apply.

On March 17, 2021, the Treasury Department and the IRS announced that the federal income tax filing due date for individuals for the 2020 tax year will be automatically extended from April 15, 2021 to May 17, 2021. Individual taxpayers, including those who pay self-employment tax, can also postpone 2020 federal income tax payments due on April 15, 2021 to May 17, 2021, without penalties and interest, regardless of the amount owed.

Internal Revenue Code (IRC) Section 1202 is a significant tax benefit that should be considered by those who have invested in small businesses and startups. This tax exemption allows noncorporate taxpayers who acquired qualified small business stock (QSBS) at original issuance and have held the stock for at least five years, the opportunity to take advantage of preferential tax treatment upon disposition of the QSBS.

Needless to say, COVID-19 has impacted the economic landscape of many businesses, across a wide array of industries, around the globe. As a result, many businesses have experienced increased risk and uncertainty about the future. This risk and uncertainty have caused many proposed and pending M&A transactions to be renegotiated, put on hold or terminated altogether.

On March 11, 2021, President Biden signed into law the American Rescue Plan Act of 2021 (ARPA) which contains specific provisions for the benefit of restaurant owners. Section 5003 of the ARPA establishes the Restaurant Revitalization Fund (RRF) to include $28.6 billion earmarked for nontaxable grants to eligible restaurant entities. $5 billion of this total amount will be designated for restaurants with 2019 gross receipts of $500,000 or less.

The American Rescue Plan Act of 2021 was signed into law by President Biden on March 11, 2021, coinciding with the one-year anniversary of the COVID-19 pandemic. The legislation is the sixth federal relief package signed into law since the onset of the pandemic in the United States last year and addresses the continuing economic and health impacts of the pandemic.