May 2, 2021
U.S. Tax This Week for April 30
Ernst & Young's U.S. Tax This Week newsletter for the week ending April 30 is now available. Prepared by Ernst & Young's National Tax Department in Washington, D.C., this weekly update summarizes important news, cases, and other developments in U.S. taxation.
Top of the Week
President Biden addresses joint session of Congress
President Biden addressed a joint session of Congress April 28, striking a hopeful tone about the nation's recovery from the pandemic, calling for action on the American Jobs Plan traditional infrastructure proposal, and detailing the American Families Plan human infrastructure proposal. The President highlighted the victories of his first 100 days of his presidency, saying progress against the pandemic during that time has been "one of the greatest logistical achievements our country has ever seen" and that stimulus checks have made a difference for many Americans. EY Tax Alert 2021-0878 has details.
Federal unemployment insurance changes in response to COVID-19 through March 11, 2021
In response to the national emergency that has been in effect since March 1, 2020 to address the COVID-19 pandemic, the U.S. Department of Labor (USDOL) and Congress took steps to expand on the existing state unemployment insurance (SUI) programs for lost wages related to stay-at-home orders, business interruptions and other consequences connected with the virus. The following provides an overview of these unemployment insurance (UI) changes of interest to employers as enacted through March 11, 2021. EY Tax Alert 2021-0869 has details.
EY Guides, Surveys, and Reports
Digital services tax jurisdiction activity summary updated
The most recent version of EY's Digital services tax jurisdiction activity summary is now available. The activity summary provides the latest information as of April 1, 2021, on the introduction of digital services taxes in several jurisdictions.
Operationalizing your intelligent tax function | Insights and hands-on tax training from EY & Thomson Reuters (May 4)
This past year of remote working created both an unprecedented need and opportunity to drive efficiencies for Tax organizations. Join EY and Global Alliance partners from Thomson Reuters for a hands-on, step-by-step webcast on developing an integrated process with Alteryx automation, ONESOURCE Workpapers, and ONESOURCE Tax Provision. During this webcast, our presenters will share tips and tricks on how to get started, as well as leading practices to enhance your current processes.
Unclaimed property enforcement amidst regulatory compliance challenges (May 6)
Please join members of Ernst & Young LLP’s Unclaimed Property and Escheat Services, for this Thought Center Webcast, practice as they address the current landscape. Our panel also welcomes guest speakers Michael Houghton and Donna Culver from the Unclaimed Property practice group of the Delaware law firm of Morris, Nichols, Arsht & Tunnell LLP, who will discuss specific challenges to Delaware’s unclaimed property enforcement program, as well as ambiguities, risks, and defenses presented with ongoing litigation.
Work from anywhere: How do we re-envisage our future after the unimaginable? (May 19)
During this EY Webcast, Ernst & Young professionals will highlight the journey of four organizations during this complicated year. Learn how they each reimagined how and where work gets done. Each panelist will share a unique point of view on the success and challenges of the past year, including a look ahead.
A taxpayer’s guide to the International Compliance Assurance Programme (ICAP) (May 20)
During this EY Webcast, Ernst & Young professionals along with the Organisation for Economic Cooperation and Development (OECD) will discuss the recently announced third phase of ICAP.
Recent Tax Alerts
Internal Revenue Service
— Apr 26: IRS extends time for submitting APA and MAP requests with e-signatures (Tax Alert 2021-0855)
— Apr 23: Split-dollar life insurance benefitting S corporation's sole shareholder/employee isn't a corporate distribution to a shareholder, but rather a taxable fringe benefit (Tax Alert 2021-0848)
— Apr 23: IRS provides safe harbor for businesses that received PPP loans in 2020 but, in keeping with then-current guidance, didn't deduct certain expenses (Tax Alert 2021-0829)
— Apr 29: Indian Court rules on applicability of Most Favored Nation clause for determining withholding tax rate on dividend payments (Tax Alert 2021-0881)
— Apr 29: OECD releases New Zealand Stage 2 peer review report on implementation of Action 14 minimum standard (Tax Alert 2021-0880)
— Apr 29: OECD releases Australia Stage 2 peer review report on implementation of Action 14 minimum standard (Tax Alert 2021-0879)
— Apr 29: Canada bans flights from India and Pakistan for 30 days (Tax Alert 2021-0877)
— Apr 28: OECD releases Israel Stage 2 peer review report on implementation of Action 14 minimum standard (Tax Alert 2021-0871)
— Apr 28: Changes to Portugal's OSS scheme and VAT filing and payment deadlines discussed (Tax Alert 2021-0870)
— Apr 28: Hong Kong introduces legislation regarding tax treatment of court-free amalgamation of companies (Tax Alert 2021-0867)
— Apr 28: Portugal nonresidents must use authorized software to issue VAT invoices from 1 July 2021 (Tax Alert 2021-0866)
— Apr 26: Dominican Republic issues amendments to transfer pricing regulations (Tax Alert 2021-0858)
— Apr 26: Mexico enacts labor reform, denies deductions for outsourcing services (Tax Alert 2021-0857)
— Apr 26: German Federal Ministry of Finance tightens marketplace liability rules (Tax Alert 2021-0856)
— Apr 23: Colombia's Executive branch submits tax reform bill to Congress (Tax Alert 2021-0849)
— Apr 23: Mexican Congress approves labor reform addressing outsourcing services (Tax Alert 2021-0846)
— Apr 23: Taiwan extends validity period of withholding tax relief at source for certain foreign institutional investors (Tax Alert 2021-0845)
— Apr 23: Danish Government revises proposed CFC legislation (Tax Alert 2021-0841)
— Apr 23: Turkey increases corporation tax rate for 2021 and 2022 tax years (Tax Alert 2021-0835)
— Apr 22: Ecuador and the United States sign Tax Information Exchange Agreement (Tax Alert 2021-0832)
— Apr 29: President Biden addresses joint session of Congress (Tax Alert 2021-0878)
— Apr 28: Biden administration outlines $1.8 trillion American Families Plan (Tax Alert 2021-0875)
— Apr 28: What to expect in Washington (April 28) (Tax Alert 2021-0874)
— Apr 27: Senate Finance subpanel holds tax fairness hearing (Tax Alert 2021-0872)
— Apr 27: Senate Finance holds climate change tax hearing (Tax Alert 2021-0868)
— Apr 26: HELP Committee hearing on protecting US biomedical research (Tax Alert 2021-0852)
— Apr 23: House Democrats and Republicans reintroduce competing drug pricing proposals, H.R. 3 and H.R. 19 (Tax Alert 2021-0843)
— Apr 29: Massachusetts delays first quarter 2021 SUI contribution payment until June 1, 2021; solvency assessment significantly increases for 2021 (Tax Alert 2021-0883)
— Apr 28: Massachusetts requires employers pay SUI interest assessment for federal loans taken to pay COVID-19 UI benefits and other 2021 SUI cost factors (Tax Alert 2021-0876)
— Apr 27: Federal unemployment insurance changes in response to COVID-19 through March 11, 2021 (Tax Alert 2021-0869)
— Apr 27: Ohio Supreme Court holds waste hauler could claim sales/use tax exemption for 'highway transportation for hire' (Tax Alert 2021-0865)
— Apr 27: New York State requires some exempt organizations to file additional reports by May 15 (Tax Alert 2021-0864)
— Apr 27: Minnesota Supreme Court holds partnership not required to reduce depletion deduction for occupation tax purposes (Tax Alert 2021-0863)
— Apr 26: Montana legislature passes double-weighed sales factor (Tax Alert 2021-0859)
— Apr 26: Montana adopts partnership audit rules (Tax Alert 2021-0854)
— Apr 22: Florida enacts remote seller nexus and marketplace provider provisions for sales tax, reduces commercial rent tax rate (Tax Alert 2021-0834)
— Apr 22: Employers may reduce their federal employment tax deposits in anticipation of COVID-related tax credits available in 2021 (Tax Alert 2021-0831)
State and Local Tax Weekly
Highlights of this edition include:
— Maryland legislature approves bill that would move applicability date of digital advertising tax to 2022, exempt certain taxpayers from tax. The Maryland legislature approved and sent to Governor Larry Hogan SB 787, which would modify the state's new Digital Advertising Services Gross Revenues Tax.
— West Virginia law enacts single sales factor apportionment and market-based sourcing, repeals throw-out rule, adopts mobile workforce provisions. On April 9, 2021, West Virginia Governor Justice signed HB 2026, modifying the state's corporate income apportionment and sourcing provisions
— Income/Franchise, Sales & Use, Business Incentives, Compliance & Reporting, Controversy, Payroll & Employment Tax, Miscellaneous Tax, Value Added Tax, Upcoming Webcasts
IRS Weekly Wrap-Up
| ||TD 9939||Qualified Transportation Fringe, Transportation and Commuting Expenses Under Section 274; Correction|
Internal Revenue Bulletin
| ||2021-17||Internal Revenue Bulletin of April 26, 2021|
| ||2021-18||Internal Revenue Bulletin of April 30, 2021|
Because the matters covered herein are complicated, U.S. Tax This Week should not be regarded as offering a complete explanation and should not be used for making decisions. Any decision concerning matters covered herein should be reviewed with a qualified tax advisor.