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  • 1.  NYS Covid Releif Grant

    Posted 03-11-2023 11:45 AM

    Is "NYS COVID Relief Grant" taxable for federal purposes? I know it is not taxable for NYS.

     

    Many thanks,

     

    Mariya Luqmani, CPA, CA, MST

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    Mariya Luqmani, CPA, P.C.

    1 Huntington Quad,Suite 3N18

    Melville, New York 11747

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    www.linkedin.com/in/mariyaluqmani

    www.mlcpas.net

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    Tel: 631-352-0786

    Fax: 516-450-5251

     

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  • 2.  RE: NYS Covid Releif Grant

    Silver Most Valuable Member
    Posted 03-11-2023 12:43 PM

    IRS Advises That 2022 State Relief Payments Should Not Be Reported as Income

    In a press release, the IRS clarified the federal tax status of special payments made by 21 states in 2022. The IRS determined that, in the interest of sound tax administration and other factors, it will not challenge the taxability of payments related to general welfare and disaster relief and therefore, taxpayers who received these payments generally do not need to report them on their 2022 federal income tax returns. IR-2023-23.



    ------------------------------
    Larry Prosky CPA
    Prosky & Rosenfeld LLP
    1025 Old Country Road
    Suite 403W
    Westbury, NY 11590
    (516) 873-9600 X1
    (516) 661-6020
    ------------------------------

    Original Message


  • 3.  RE: NYS Covid Releif Grant

    Silver Most Valuable Member
    Posted 03-11-2023 01:03 PM

    During a review, the IRS determined it will not challenge the taxability of payments related to general welfare and disaster relief. This means that people in the following states do not need to report these state payments on their 2022 tax return: California, Colorado, Connecticut, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Maine, New Jersey, New Mexico, New York, Oregon, Pennsylvania and Rhode Island. Alaska is in this group as well.



    ------------------------------
    Larry Prosky CPA
    Prosky & Rosenfeld LLP
    1025 Old Country Road
    Suite 403W
    Westbury, NY 11590
    (516) 873-9600 X1
    (516) 661-6020
    ------------------------------

    Original Message


  • 4.  RE: NYS Covid Releif Grant

    Posted 03-12-2023 04:25 PM
    At the webinar last Thursday, March 2nd,, I believe it was said that the Covid-19 payments from the state were taxable on the Federal corp returns, but not
    on the state return.
    Which answer is correct?



    Original Message


  • 5.  RE: NYS Covid Releif Grant

    Silver Most Valuable Member
    Posted 03-12-2023 04:36 PM
    the state grants were always tax free on the state. originally it was taxable on federal but then IRS issued guidance that it was tax free on federal level too.

    --
    Larry Prosky CPA
    Prosky & Rosenfeld LLP CPAs
    1025 Old Country Road
    Suite 403 W
    Westbury, NY 11590
    Direct: 516-873-9600 x1
    Fax: 516-873-9602
    Cell (Text) 516-661-6020
    Other: 516-785-5658
    e-mail: larry@prcpallp.com


    Any accounting, business or tax advice contained in this communication, including attachments and enclosures, is not intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax-related penalties.  If desired, Prosky & Rosenfeld LLP CPAs would be pleased to perform the required research and provide you with a detailed written analysis.  Such an engagement may be the subject of a separate engagement letter that would define the scope and limits of the desired consultation services.  

    Privileged and confidential-this communication and any accompanying documents are confidential and privileged.  They are  intended for the sole use of the addressee.  If you receive this transmission in error, you are advised that any disclosure, copying, distribution or the taking of any action in reliance upon this communication is strictly prohibited.  Moreover, any such disclosure shall not compromise or waive the accountant-client, or other privileges, as to this communication or otherwise.  If you have received this communication in error, please contact me at the above e-mail address.  Thank you.
     



    Original Message


  • 6.  RE: NYS Covid Releif Grant

    Bronze Most Valuable Member
    Posted 03-12-2023 05:10 PM

    Larry & anyone else,,,

    What's your opinion on these pandemic grants given in 2021?  I filed the 2021 tax returns reflecting $50,000 taxable to IRS and exempt NY.  I'm vacillating on whether I should amend 2021.  It's a big tax saving, like $20,000 tax.  It's also a lot of work amending the business & personal returns.  And if the IRS denies it, that means undoing what was done. My hesitation is that what the IRS emanated, specifically refers to the 2022 tax year. AND the way I read it, it's almost like IRS is stating we're going to look the other way ("not challenge"), not exactly stating it's not taxable.

    Thanks



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    Robert Lusthaus
    ROBERT S. LUSTHAUS, CPA PC
    PLAINVIEW NY
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    Original Message


  • 7.  RE: NYS Covid Releif Grant

    Silver Most Valuable Member
    Posted 03-12-2023 05:26 PM
    The comment made by the IRS in late 2022 about not taxing state covid grants only pertained to 2022.  I have not seen anything pertaining to 2021 (either way) so I would suggest further investigation before you go thru the amending returns process.

    --
    Larry Prosky CPA
    Prosky & Rosenfeld LLP CPAs
    1025 Old Country Road
    Suite 403 W
    Westbury, NY 11590
    Direct: 516-873-9600 x1
    Fax: 516-873-9602
    Cell (Text) 516-661-6020
    Other: 516-785-5658
    e-mail: larry@prcpallp.com


    Any accounting, business or tax advice contained in this communication, including attachments and enclosures, is not intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax-related penalties.  If desired, Prosky & Rosenfeld LLP CPAs would be pleased to perform the required research and provide you with a detailed written analysis.  Such an engagement may be the subject of a separate engagement letter that would define the scope and limits of the desired consultation services.  

    Privileged and confidential-this communication and any accompanying documents are confidential and privileged.  They are  intended for the sole use of the addressee.  If you receive this transmission in error, you are advised that any disclosure, copying, distribution or the taking of any action in reliance upon this communication is strictly prohibited.  Moreover, any such disclosure shall not compromise or waive the accountant-client, or other privileges, as to this communication or otherwise.  If you have received this communication in error, please contact me at the above e-mail address.  Thank you.
     



    Original Message


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The opinions expressed are the views of the author alone and should not be attributed to any other individual or entity and shall not constitute an accounting opinion.