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General

Jen Campbell-Brown
In Employee Benefit Plans, General, Industry News, News

The SECURE 2.0 Act of 2022

The SECURE 2.0 Act of 2022 (Act) was signed into law on December 29, 2022, to increase retirement savings, improve retirement rules, and lower employer costs of setting up a retirement plan. Plan amendments required by the Act generally need not be made until the end of the first plan year beginning on or after January 1, 2025; however, plans must be operated in accordance with the effective date of each new provision. Following is a summary of some of the significant provisions that may affect plan sponsors and auditors:

Autoenrollment/auto escalation: Effective for plan years beginning after December 31, 2024, new 401(k) and 403(b) plans must automatically enroll participants when they become eligible; employees may opt out of coverage. All 401(k) and 403(b) plans in effect on the date of enactment are grandfathered; small businesses with 10 or fewer employees, new businesses (i.e., those that have been in business for less than three years), church plans, and governmental plans are exempted from this provision.

Repeal and replacement of the Saver’s Credit: A new “Saver’s Match” will replace the current law nonrefundable “Saver’s Credit” for certain individuals who make contributions to employer retirement plans. The match is subject to an income-based phase out and becomes effective for tax years beginning after 2026.

Required Minimum Distributions (RMDs): The RMD age will increase in 2023 and again in 2033. Starting in 2024, Roth accounts will be exempt from the RMD rules while the participant is alive.

Catch-up contributions: The catch-up contribution limit will increase for taxable years beginning after December 31, 2024. Starting in 2024, all catch-up contributions must be Roth contributions for participants with compensation equal to or in excess of $145,000.

Changes to long-term, part-time employees: The Act modifies the measuring period for long-term, part-time employees from three years to two years and also extends the long-term, part-time employee provision to 403(b) plans that are subject to ERISA.

Student loan payments: For plan years beginning after December 31, 2023, employers may make matching contributions under a 401(k) or 403(b) plan on employees’ qualified student loan payments. Employees who receive such matching contributions are required to certify annually to the employer that such payment has been made on such loan.

Withdrawals for certain emergency expenses: The Act provides an exception from the 10% tax on certain early distributions made after 2023 that are used for emergency expenses which are unforeseeable or immediate family needs relating to personal or family emergency expense. Plan administrators generally may rely upon a participant’s self-certification; however, the IRS is authorized to issue guidance to address situations in which a plan administrator has actual knowledge to the contrary or there are employee misrepresentations.

Increased dollar threshold for mandatory distributions: For distributions after December 31, 2023, the involuntary distribution threshold will increase from $5,000 to $7,000.

Pension linked emergency savings accounts (ESA): Beginning in 2024, DC plans may include an ESA for non-highly compensated employees; accounts are part of the plan document but accounted for separately. Employers may automatically opt their employees into these accounts, and all contributions must be made on an after-tax basis.

Recovery of retirement plan overpayments: Effective immediately, retirement plan fiduciaries have the discretion to not recoup overpayments mistakenly made to retirees. Where a plan’s fiduciaries choose to recoup overpayments, collection efforts are subject to certain limitations and protections to safeguard retirees. Rollovers of the overpayments remain valid.

Compliance testing/corrections: The Act includes changes to the rules for top-heavy plan testing, expands the IRS Employee Plans Compliance Resolution System to allow more types of errors to be rectified internally through self-correction and exempt certain failures to make RMDs from the excise tax penalty, and allows for a grace period to correct, without penalty, reasonable errors in administering automatic enrollment and automatic escalation features occurring after December 31, 2023.

403(b) plans: The Act conforms the current hardship distribution rules for 401(k) plans to 403(b) plans and the long-term, part-time employee provision is extended to 403(b) plans that are subject to ERISA. In addition, 403(b) plans will now be allowed to invest in collective investment trusts (CITs). Beginning in 2023, 403(b) plans can join a multiple employer plan (MEP) or pooled employer plan (PEP).

Annual audits for groups of plans: The Act clarifies that each plan filing under a group of plans (added by the SECURE Act) is required to submit audited financial statements if it has 100 participants or more. Plans with fewer than 100 participants that are included in a group of plans are not required to submit audited financial statements.

Other: The Act amends qualified birth and adoption distribution rules, permits plans to distribute money to pay premiums for high-quality long-term care insurance products and allow withdrawals by participants who have experienced domestic abuse.

 

Source: AICPA Employee Benefit Plans Audit Quality Center. Click here to read the SECURE 2.0 Act (included as Division T on pages 2,046 to 2,404 of the Consolidated Appropriations Act, 2023).

Jen Campbell-Brown
In General, News

IRS increases mileage rate for remainder of 2022

With rising gas prices, traveling for work is becoming more and more worrisome. Thankfully, the IRS has our backs. If you or your employees travel for work, check out this update from the IRS.

“IR-2022-124, June 9, 2022

WASHINGTON — The Internal Revenue Service today announced an increase in the optional standard mileage rate for the final 6 months of 2022. Taxpayers may use the optional standard mileage rates to calculate the deductible costs of operating an automobile for business and certain other purposes.

For the final 6 months of 2022, the standard mileage rate for business travel will be 62.5 cents per mile, up 4 cents from the rate effective at the start of the year. The new rate for deductible medical or moving expenses (available for active-duty members of the military) will be 22 cents for the remainder of 2022, up 4 cents from the rate effective at the start of 2022. These new rates become effective July 1, 2022.

The IRS provided legal guidance on the new rates in Announcement 2022-13 PDF, issued today. In recognition of recent gasoline price increases, the IRS made this special adjustment for the final months of 2022. The IRS normally updates the mileage rates once a year in the fall for the next calendar year. For travel from January 1 through June 30, 2022, taxpayers should use the rates set forth in Notice 2022-03 PDF.

“The IRS is adjusting the standard mileage rates to better reflect the recent increase in fuel prices,” said IRS Commissioner Chuck Rettig. “We are aware a number of unusual factors have come into play involving fuel costs, and we are taking this special step to help taxpayers, businesses and others who use this rate.”

While fuel costs are a significant factor in the mileage figure, other items enter into the calculation of mileage rates, such as depreciation and insurance and other fixed and variable costs.

The optional business standard mileage rate is used to compute the deductible costs of operating an automobile for business use in lieu of tracking actual costs. This rate is also used as a benchmark by the federal government and many businesses to reimburse their employees for mileage.

Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.

The 14 cents per mile rate for charitable organizations remains unchanged as it is set by statute.

Midyear increases in the optional mileage rates are rare, the last time the IRS made such an increase was in 2011.”

 

Mileage Rate Changes

 

Purpose Rates 1/1 through 6/30/2022 Rates 7/1 through 12/31/2022
Business 58.5 62.5
Medical/Moving 18 22
Charitable 14 14

Source (article and table): Internal Revenue Service. “IRS increases mileage rate for remainder of 2022.” June 9, 2022. https://www.irs.gov/newsroom/irs-increases-mileage-rate-for-remainder-of-2022

Brickley DeLong
In General, News

Michigan – UIA Update

 

Unemployment Insurance Agency

Michigan Department of Labor and Economic Opportunity
Dear Employers:

UIA is in the process of updating benefit charges for contributing and reimbursing employers. We are taking this action in order to comply with the temporary expansion in unemployment eligibility and cost-sharing that is part of the Governor’s Executive Order 2020-76.

This notice is being sent to assure you that employers will not be charged for employees collecting benefits due to a layoff, leave of absence, temporary shutdown, or reduced work hours for the weeks ending 3/21/2020 through the end of the Executive Order (currently the week of 8/15/2020).  Benefits charges for those weeks will be charged to the Nonchargeable Benefits Account (NBA).

Due to the updating of benefit charging being incomplete, we understand discrepancies occurred in your current billing. We are resolving those discrepancies, updating all accounts with credits, and a new billing statement will be issued to you once our system updates are completed. If you already paid your 2nd quarter 2020 bill and credits are applied later, you may use the credits toward the 3rd quarter 2020 billing or you may request a refund.

To request a refund, log into your MiWAM account. Under the Account Services tab, click “Apply for Credits.”

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Michael Davis
In General

This January we welcome three new staff accountants

This January, we are excited to announce three full-time staff accountants working in our Grand Rapids and Muskegon offices.

J Photography of Grand Rapids, LLCDavid Milligan has received his bachelor’s in accounting from Grand Valley State University. He is recently married and he and his wife reside in Grand Rapids. In his free time, he enjoys hunting, fishing, and golfing. He will be working out of our Muskegon office.

 

 

J Photography of Grand Rapids, LLCDonny Baird did his undergrad at Grand Valley State University. This year he plans to finish the MSA program and then sit for the CPA exam. In his free time he enjoys bowling. He currently lives in Grand Rapids and will be working in the Muskegon office.

 

 

J Photography of Grand Rapids, LLCEric Huizing (previously our tax intern in Grand Rapids) returned to our Grand Rapids office as a full time staff accountant.  He received his Master’s in Accountancy and Chinese from Calvin College. This past year he had the opportunity to study abroad in China. In his free time he enjoys cycling.

 

Michael Davis
In General

Brickley DeLong Welcomes New Accounting Employees!

We are pleased to announce three new employees who will be working at Brickley DeLong.

Andrea Kerkstra
Andrea is originally from Scottville, Michigan. She earned her Bachelor’s degree from Central Michigan University in 2006. After earning her degree, she worked at an Accounting firm in Gaylord for two and a half years and then a firm in Manistee for three years. Some of her hobbies include reading, traveling, and scuba diving. Andrea will be working in our Grand Rapids office.

Evan Patterson
Evan was born and raised in Ravenna, MI. After graduating high school, he began attending school at Muskegon Community College, and then transferred to Grand Valley State University. At Grand Valley, Evan is currently a senior majoring in Accounting and Finance. In his free time, he enjoys playing basketball as well as outdoor activities such as snowboarding and water skiing. Evan will be interning at our Muskegon office during tax season.

Eric Huizing
Eric is a senior at Calvin College and will be graduating with a degree in Accounting and Chinese Language. He is from Grand Rapids and is currently living in Easttown. Some of his hobbies include cycling, film, competition, and brewing beer. He comes from a family of four (three of which are accountants); he believes that this is where his interest in accounting stemmed from. Eric will be interning at our Grand Rapids office during tax season.

Michael Davis
In General

Brickley DeLong Welcomes a New Employee

The staff at Brickley DeLong are excited to welcome Kirk Kauffman, CPA to our Grand Rapids Office. Kirk is originally from the Grandville/Jenison area. He received a Bachelor’s as well as a Master’s in Accounting at Grand Valley State University. Since finishing school, he has worked as a CPA in Texas as well as Vermont.

He and his wife are expecting a baby girl in December. Because of this exciting news, they decided to move back to West Michigan to be close to family and friends.

Kirk enjoys a variety of outdoor activities, such as hiking and camping. In addition, he played water polo at GVSU; he is looking forward to continue playing through a local club team.

I am happy to be with Brickley DeLong and excited about the prospect of joining the Grand Rapids office, which is looking to grow considerably in the near future.  Having the chance to get in at the ‘ground floor’ of that kind of growth was just too good of an opportunity to pass up!  I am hoping that this is the beginning of a long career with Brickley DeLong – Kirk Kauffman

Michael Davis
In General

Brickley DeLong Welcomes a New Employee!

We are excited to welcome Larry Hall to the Brickley DeLong family. Larry just moved back to the Muskegon area from North Carolina. While he was there,  he worked as a Intercompany Accountant at Ingersoll-Rand corporate headquarters. Prior to living in North Carolina he worked at another accounting firm in Muskegon in which he performed client accounting, payroll services, and tax services. In 2010, he became a CPA and recieved an MBA from Baker College.

Larry lives in Norton Shores with his wife. He has one daughter. He enjoy road bicycling and playing the guitar. He is a former (retired) musician and used to make a living traveling and playing in bands. He has played at such local events such as Summer Celebration and Party in the Park.

I am very excited to be a part of the team here at Brickley DeLong.  I plan to make a long career here and maybe start playing in bands again as a hobby.- Larry Hall, CPA

Michael Davis
In General

Brickley DeLong Welcomes a New Employee

Brickley DeLong is pleased to introduce a new employee! Jennifer Batts, a recent graduate of Grand Valley State University was hired on to be our new marketing assistant. Before receiving her B.S. degree in Advertising and Public Relations, Jennifer worked two different internships where she was responsible for all social media, direct mail, e-mail marketing, and creating and designing ads. Her hobbies include scrapbooking, biking, and skiing. We are excited to have her as part of the Brickley DeLong family.