News and Events

I’ve Been Working My Philadelphia-based Job from Home in the Suburbs. Do I Need to Pay Philadelphia Wage Tax?

The City of Philadelphia has issued guidance for employees working for Philadelphia-based organizations who have been required to work from their homes outside of Philadelphia due to the COVID-19 pandemic. The key word being “required.” It states:

The City of Philadelphia uses a “requirement of employment” standard that applies to all non-residents whose base of operation is the employer’s location within Philadelphia. Under this standard, a non-resident employee is not subject to the Wage Tax when the employer requires him or her to perform a job outside of Philadelphia including working from home.

 

A non-resident employee who works from home for his or her convenience is not exempt from the Wage Tax – even with his or her employer’s authorization. On the other hand, if a Philadelphia employer requires a non-resident to perform duties outside the city, he or she is exempt from the Wage Tax for the days spent fulfilling that work.

If your Philadelphia-based employer continues to withhold Philadelphia Wage Tax from your paycheck while you are required to work from your home located outside of Philadelphia, you can request that they stop this withholding until you stop working from home due to the COVID-19 pandemic.

At the end of the 2020 tax year, you will be able to file for a Philadelphia Wage Tax refund. The application form is available here.

If you have questions about this or any other payroll issue, please call us at 215-723-4881 or contact us online.

The Latest on PPP Loan Forgiveness

As you are probably aware, many banks have been promoting that they have started to accept applications for PPP loan forgiveness. However, the banks are finding that most of the forgiveness applications they receive are incomplete or incorrect. This is partly due to the lack of significant guidance from the SBA and the Treasury Department on the filing of applications prior to the completion of the 24-week covered period. The SBA and Treasury continue to release guidance containing definitions and limits vs. the logistics and mathematics of filing for forgiveness early.

To that end, an Interim Final Rule (IFR) was issued on August 24th. This IFR contains information on certain situations like sublets, mortgage interest, and home-based businesses. It speaks to some more common scenarios as well. This interim final rule clarified the following:

  • Corporate owners with less than 5% ownership are NOT subject to the limits on owner compensation (see this chart on owners’ compensation limits).
  • Partners in a partnership, however, are still subject to the $20,833 guaranteed payment limit for the 24-week covered period.
  • Related party rent expense is now limited to the equivalent of the mortgage interest on the property during the covered period.
  • Mortgage interest paid to a related party is NOT eligible for forgiveness

If any of the above circumstances apply to your situation and you filed the forgiveness application prior to August 24th, it is most likely wrong. You should contact your bank immediately to see what can be done to correct your application.

We, as a firm, are STILL advocating patience in filing the applications. There will definitely be more guidance issued on the logistics and mathematics of completing the application. There will also most likely be more guidance issued on dollar limits, definitions, etc. Most of all, we believe there will be more legislation passed possibly affecting the PPP program.

We will continue to monitor the situation and communicate significant developments. We will also consider holding a Zoom Meeting on the topic for the end of September or beginning of October.

As always, if you have any questions, please do not hesitate to call us (215-723-4881).

Payroll Tax Holiday Begins September 1, 2020

In early August, 2020, President Trump issued an executive order deferring the employee portion of Social Security Tax beginning September 1, 2020, through the end of the year.  As of today, the Treasury Department has not issued guidance as to how employers should implement this Payroll Tax Holiday deferral. 

Until guidance is issued from the Treasury Department, we will continue to withhold Social Security tax from our client payrolls but are offering the deferment option upon request. If you are opting for deferment of the employee portion of Social Security Tax for your company’s payroll, you may wish to inform your employees that this is a deferment and not a reduction of the Social Security tax. Employees will owe this tax when they file their 2020 personal tax returns.
As always, if you have any questions, please do not hesitate to call us (215-723-4881).

Marissa Illingworth Earns Accredited Investment Fiduciary Designation

We are pleased to announce that Marissa Illingworth, Canon Capital Wealth Management Investment Advisor, has earned the designation of Accredited Investment Fiduciary (AIF). The purpose of this designation is to assure that those responsible for managing or advising on investor assets have a fundamental understanding of the principles of fiduciary duty, the standards of conduct for acting as a fiduciary, and a process for carrying out fiduciary responsibility. This professional certification demonstrates that Marissa has met the requirements to earn and maintain this widely respected credential.

If you have any current needs regarding your investment or retirement plans, please feel free to contact our Wealth Management department via phone at 215-723-4881 or online.

Now Is a Good Time to Do a Paycheck Check-up

To say that 2020 has brought a lot of change into our lives is an understatement. Now that businesses have started to reopen and employee pay may have been adjusted from earlier projections, it is an ideal time to do what we call a “Paycheck Check-up” to ensure the desired amount of federal withholding tax is withheld each pay period.

Access the online withholding calculator here.

We urge you to share this information with your employees so that they can take proactive measures before the end of this year.

If you have questions, please consult with your payroll service or tax advisor. If you do not currently have a payroll service or tax advisor, we welcome the opportunity to serve you. Please call 215-723-4881 or contact us here.

We Are Hiring! Immediate Need for a CPA Manager

Looking for a new challenge? Tired of the long commute to that large accounting firm in Philadelphia? Eager for that next step in your career to firm leadership?

Or perhaps you have a trusted colleague, family member, or friend who is considering a new opportunity? We are currently offering a $1,000 referral bonus to you should we hire the person you refer to us.

If you or someone you know are in search of a new opportunity in an environment where going above and beyond and having a desire to benefit our community by serving our clients well is the norm, let’s see if you/they would be a good fit for our CPA Manager position in our Harleysville office.

We are seeking a manager/leader who is a clear communicator, curious, adaptable, personable, collaborative, and above all, self-motivated. These qualities are imperative in meeting our expectations for the quality of service required by our commitment to our clients, but they are also necessary in providing leadership to our staff. The successful candidate for this position will be viewed as having a fast-track to partner status.

We provide the usual services but going over and above basic compliance is our goal. We interact on a regular basis with our small business clients, meeting throughout the year to provide consulting and other services. We are also pleased to work with a wide array of not-for-profit clients who better our community every day. Internally, we offer a friendly work environment with an emphasis on work-life balance tailored to each person’s goals and expectations. If that sounds inviting, and you think you have something to contribute to our firm, apply today with salary requirements as well as a cover letter telling us something about yourself that makes you the right person for this position.

Job Type: Full-time

Pay: $75,000.00 – $100,000.00 per year

Education: Bachelor’s (Required)

Licensing: CPA (Required)

Experience:

  • Minimum 5-7 years of recent public accounting experience; A&A (preferred) or both A&A and tax
  • Proficiency in QuickBooks and Microsoft Office; QuickBooks ProAdvisor a plus, not required
  • Proficiency with Thomson Reuters UltraTax and accounting products a plus, but not required
  • Personnel management a plus, but not required

This Job Is Ideal for Someone Who:

  • Demonstrates a high degree of independent judgment
  • Possesses the ambition to embrace opportunities that present themselves
  • Excels at providing quality work in a timely and accurate manner
  • Exercises excellent communication skills, both written and verbal, in any setting
  • Multi-tasks, meets required deadlines, and works effectively as part of a team
  • Shows strong technical, analytical, and organizational skills
  • Thrives in a relatively high-pressure environment and can make frequent shifts as the job demands
  • Knows how to manage and develop staff, giving regular feedback and guidance

Responsibilities will include:

  • Providing A&A services using Thomson Reuters accounting products for compilations, reviews, and audits of not-for-profits and for-profit businesses in varied industries.
  • Providing tax services using Thomson Reuters UltraTax for Forms 706, 709, 990 series, 1040, 1041, 1065, 1120 series, and multi-state and local returns, with Thomson Reuters accounting product integration
  • Taking responsibility for planning and executing client engagements as assigned, delegating work to staff, reviewing that work, and training as necessary
  • Managing personnel as assigned, including annual reviews and interim monitoring as needed
  • Other projects as they arise

Benefits Offered:

  • Flexible work schedule
  • Referral bonus program
  • Paid time off
  • Health insurance
  • Dental insurance
  • Life insurance
  • 401(k) retirement plan
  • Flexible Spending and Dependent Care Accounts
  • AICPA/PICPA dues and CPE costs
  • Educational and professional designations reimbursement

Schedule: Monday to Friday, additional tax season hours from January to April 15

Email resume and cover letter to hresources@canoncapital.com

Non-Resident Philadelphia Wage Tax Increases on July 1, 2020

The Philadelphia Wage Tax for non-resident employees will increase beginning Wednesday July 1, 2020.

Any paycheck issued with a pay date after June 30, 2020 must withhold the Philadelphia City Wage Tax at this new rate for non-resident employees: 3.5019% (.035019), an increase from 3.4481% (.034481).

The Wage Tax for Philadelphia residents remains at 3.8712% (.038712).

If you have questions about this issue or any other item related to your payroll, please call 215-723-4881 or contact us online.

Make Time for Tech Tools

For every tech tool available to you, there is also the consideration of the time it will take to set up and begin using it. The key is to find the tool that is right for your current needs.

Here are several tech tools we recommend, especially as many companies continue their work from home plans.

Quality Communication Devices

Something as simple as a $15 headset and a $30 webcam from Amazon can make a world of difference in the quality of your communication with co-workers and clients versus using the mic and camera built into a laptop or just using your cell phone.

Communication Apps

No matter which one you choose — Slack, Microsoft Teams, etc. — being able to communicate quickly with your team helps increase a sense of relationship and allows for continued efficient group work.

Security

Establish a set of security items – especially when employees are working on public WiFi or unknown personal networks. This could be using a VPN, turning on multifactor authentication, upgrading antivirus and antimalware programs, requiring the use of a password manager, or a combination of these and other security items.

Status Boards

The use of an In/Out or status application or website helps the entire company easily see whether someone is ‘in’ or not. This is especially useful if your team is completely or partially remote, has flexible schedules, or if there are individuals who don’t work every day/all day.

Phone App

Even if your business phone provider doesn’t have their own mobile app that employees can install on their smartphone to manage work calls, there are free third-party apps, like Bria and GrandStream Wave, which work with many different providers to allow employees to keep work and personal calls separate.

If you would like more information on any of these tools, or if you have a specific situation you would like to discuss, contact Craig Covington at 215-723-4881 x129 to arrange for your free Technology Review.

SBA and Treasury Release Revised Forgiveness Applications for PPP Loan Forgiveness

Yesterday afternoon, the SBA released a revised forgiveness application, Form 3508 (Form 3508 Instructions), and a new “EZ” (EZ Form Instructions) application requiring less documentation. Both of these forms incorporate changes made by the recently enacted Paycheck Protection Flexibility Act (Click here for more information on the recent rule changes.).  The new EZ application can be used by any borrower meeting any of the following criteria:
  •  Are self-employed and have no employees, OR
  • Did not reduce salary or wages for any employee by more than 25%, and did not reduce the number or hours of their employees (except those employees who refused a written offer to return to work at the same rate and hours), OR
  • Experienced reductions in business activity as a result of health directives related to COVID-19, and did not reduce the salaries or wages of their employees by more than 25 percent
A few immediate important observations on this release:
  1. For a sole proprietor, the “compensation” eligible for forgiveness is capped at $20,833.  This in essence guarantees full forgiveness for these individuals that do not have employees.
  2. There are new provisions for self-employed individuals who have employees.
  3. As suspected, they did increase the salary limit from $15,385 to $46,154 per employee, which reflects the new 24-week period.
  4. Health insurance costs for S-corporation owners cannot be included when calculating payroll costs; however, retirement costs for S-corporation owners are eligible costs.
  5. Safe harbors for excluding salary and hourly wage reductions can be applied as of the date the loan forgiveness application. Therefore, borrowers do not have to wait to December 31 to apply for forgiveness
Perhaps most importantly, the application kept the FTE reduction quotient as being applied against total costs incurred over the 24 weeks vs. the forgivable costs based on the loan amount. Thus, with total costs over a 24-week period vs. an initial 10-week borrowing capacity, it seems to reason that most businesses should be able to afford a significant reduction in FTE count – even if they can’t meet the safe harbor at any point later this year.
All of this is good news and seems like most small business borrowers will have their entire loan forgiven. Of course, all the calculations have to be done, and reports generated, but we will have time. Banks will not be ready to take applications for a number of weeks yet, so there is no immediate rush to complete the applications.
As you would suspect, significant questions remain and significant guidance has yet to be released. We will provide additional information as it becomes available. In the meantime, if you have any questions, please don’t hesitate to contact us via email or phone at 215-723-4881.

COVID-19 Concerns and the Market: A Historical Perspective

The uncertainty that COVID-19 has brought to so many aspects of our lives is real. You may have been tempted to make some changes to your portfolio based on the volatility of the market during this time. While this particular coronavirus is new, we do have the advantage of knowing how the market has responded and regained its strength when faced with previous global health crises. Take a moment to read this brief overview for a complete perspective.

As always, we are happy to discuss any questions you may have or to review your portfolio. Call 215-723-4881 to schedule an appointment with your advisor.