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Tax Pros: Filing Season Going Well, But Some Concerns Remain

By:
S.J. Steinhardt
Published Date:
Apr 12, 2024

iStock-161760094 1040 Form

Despite the 2024 filing season being one of the smoothest in recent memory, uncertainly still exists due to legal and legislative issues, according to tax professionals, Accounting Today reported.

The Corporate Transparency Act is one cause for uncertainty. While the law, which came to effect on Jan. 1, is not a tax issue, many accountants may deal with small businesses that come under the purview of the act's beneficial ownership information (BOI) reporting requirements. 

In a recent letter to the Department of the Treasury and the Financial Crimes Enforcement Network (FinCEN), the AICPA, together with 54 state CPA societies, expressed serious concerns with the rollout and push to implement FinCEN’s BOI reporting requirement without regard for the impact to the small business community.

The Tax Relief for American Families and Workers Act of 2024, which passed the U.S. House of Representatives in January, contains taxpayer-favorable alterations to the Child Tax Credit and three lapsed business provisions: bonus depreciation, research and experimental expenditures, and the business interest deduction limitation. The bill still awaits action in the Senate and may not be taken up by that chamber until after the November elections.

Depending on the client, this could be a pretty significant delay, Ryan Losi, executive vice president of Virginia-based CPA firm Piascik, said in an interview with Accounting Today. 

"It has caused heartburn for some companies in the tech industry or pharmaceuticals," he said. “They have to capitalize expenses rather than include them as deductions, which can make the difference between making a profit or paying tax on taxable income that doesn't exist. … [M]aybe tax season won't be so smooth because you have to file based on current law, not what you think it will be."

While for many tax pros, the current filing season has generally gone well, it may be the last for a while, said Mark Steber, chief tax officer at Jackson Hewitt, in an interview with Accounting Today. "A new 1099-K, the presidential election, expiring Trump provisions all converge, so we may have seen the last of the "normal" seasons for a while," he said. 

Legislators in Congress may also make retroactive changes, which they may instruct the IRS to implement, or some returns may have to be amended in order for taxpayers to receive benefits, according to Tom O'Saben, director of tax content and government relations at the National Association of Tax Professionals. "Pay close attention to the news," he advised, in an interview with Accounting Today. 

With the end of the filing season in sight, Roger Harris, president of Padgett Business Services, told Accounting Today that he agreed with other tax pros that it's gone pretty well, overall. 

"There have been some minor hiccups here and there, but compared to most recent filing seasons it's been relatively smooth," he said. "The problem every year has been late 1099s, and it seems as though there are more corrections this year than in the past.” He used an example of taxpayers who don’t realize that their financial adviser has invested their money in a limited partnership with an ownership interest in an enterprise, such as an oil well.

“They bring in all their information at the end of March, get their return filed and then show up two weeks later with the additional information,” he said. “Or they might leave it for the IRS to fix, since the preparer might cost more than the tax that is due. It's frustrating, because it creates additional work for the preparer and for the IRS."

"Tax professionals at this time of year have come to appreciate one general rule of thumb: Expect the unexpected," Jim Guarino, managing director at Baker Newman Noyes, told Accounting Today. "Living by that mantra helps us to navigate and weather the storm that is certain to come every January."

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