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The 2021 archive

Everything Fortress published in 2021, newest first — the developments and planning windows that defined the year.

20 pieces in this view

AnalysisDecember 20216 min read

The 2022 Estate Exemption Rises to $12.06 Million: A Gifting Window Framed by the 2026 Sunset

The IRS has released the 2022 inflation adjustments, and the federal estate, gift, and generation-skipping transfer tax exclusion rises to $12,060,000 — with the annual gift exclusion increasing to $16,000, its first move since 2018. The larger number is welcome, but the more important fact for planning is the calendar behind it: under current law, the doubled exclusion is scheduled to be cut roughly in half on January 1, 2026. For families with the means and the intent to make large gifts, the window to use the higher exclusion is real, finite, and protected against clawback.

ReadTrusts & Estates

AnalysisDecember 20217 min read

The Infrastructure Act Ended the Q4 Employee Retention Credit Retroactively: What Employers Who Already Reduced Deposits Must Do

The Infrastructure Investment and Jobs Act, signed November 15, ended the Employee Retention Credit for the fourth quarter of 2021 — except for recovery startup businesses — and made the cutoff retroactive to October 1. Because the law arrived six weeks into the quarter, many employers had already reduced their payroll tax deposits in anticipation of a credit that is no longer available. The IRS has now provided a penalty-relief safe harbor in Notice 2021-65, but it has hard deadlines, and missing them turns an anticipated credit into a failure-to-deposit penalty.

ReadControversy & Compliance

AnalysisDecember 20217 min read

Year-End 2021 for Business Owners: The Provisions That Reset on January 1

Several enacted-law inflection points sit at the 2021–2022 boundary, and they do not all move the same way. The biggest is the requirement that research and experimental costs be capitalized starting in 2022, ending decades of immediate expensing. The interest-deduction calculation tightens. Two 100% benefits — bonus depreciation and restaurant meals — continue into 2022, so their cliffs are later. And one credit, the Employee Retention Credit, has already ended for most employers. This is a year-end checklist built entirely on current law, because the planning that holds up is the planning that does not depend on a bill that has not passed.

ReadBusiness & Planning

AnalysisNovember 20211 min read

Build Back Better's Proposed Grantor Trust Changes: A Planning Urgency Assessment

Late-2021 estate planning conversations were shaped by proposed legislation that could materially change the tax treatment of certain grantor trust strategies. Even without final enactment, the proposal created real urgency.

ReadTrusts & Estates

AnalysisNovember 20217 min read

The Infrastructure Act's New Digital-Asset Reporting Rules: Why Crypto Recordkeeping Is a Now-Problem Even Though the Forms Arrive in 2024

The Infrastructure Investment and Jobs Act, signed November 15, enacted the first comprehensive information-reporting regime for digital assets. It expands the definition of "broker," requires basis reporting on crypto, mandates transfer statements when assets move to outside wallets, and — most controversially — treats digital assets as "cash" for the $10,000 trade-or-business reporting rule. The reporting itself does not begin until 2024. But the statute is law now, the scope of who counts as a "broker" was left deliberately open, and the basis-tracking it will eventually demand starts with transactions in 2023. The recordkeeping work is a present obligation, not a future one.

ReadControversy & Compliance

AnalysisNovember 20211 min read

The Section 199A Deduction in 2021: Planning While the Pass-Through Window Is Still Open

With only a few years remaining before the scheduled sunset of Section 199A, 2021 is a good time for pass-through owners to review whether they are capturing the deduction efficiently.

ReadBusiness & Planning

AnalysisOctober 20211 min read

California's Pass-Through Entity Tax Election: How the 2021 Workaround Changes SALT Planning

California's elective pass-through entity tax created a practical workaround to the federal SALT cap for many pass-through owners. The opportunity is meaningful, but the election requires timing, entity-level planning, and disciplined payment procedures.

ReadState & Local

AnalysisSeptember 20211 min read

IRS Backlogs and Automated Notices: Responding When the Agency Has Not Caught Up to the Mail

In 2021, many notices were generated in an environment where the IRS was still dealing with processing delays and unworked correspondence. That mismatch created a practical question for taxpayers: how do you respond when the notice is real but the underlying account is incomplete?

ReadControversy & Compliance

AnalysisAugust 20211 min read

Advance Child Tax Credit Payments: Avoiding Repayment Surprises When You File

Advance child tax credit payments created welcome cash flow for many families in 2021, but they also created a reconciliation problem that some taxpayers will not notice until return preparation.

ReadBusiness & Planning

AnalysisAugust 20211 min read

Owner Wages and the ERC: What IRS Notice 2021-49 Changed for Closely Held Businesses

IRS Notice 2021-49 changed the conversation for closely held businesses claiming the employee retention credit. Many businesses that assumed owner compensation would qualify now need to review the family attribution rules much more carefully.

ReadControversy & Compliance

AnalysisJune 20217 min read

Excess Business Loss Limits Are Back for 2021: Why a Large Business Loss May Not Offset Your Other Income

The CARES Act suspended the excess business loss limitation of IRC § 461(l) for 2018 through 2020. That suspension has lapsed. For 2021 — the first year the cap actually bites since it was enacted — a noncorporate taxpayer's business losses can offset other income only up to a threshold of $262,000, or $524,000 on a joint return. Losses beyond that are not deductible this year; they convert to a net operating loss carried into next year. Owners and investors still recovering from the pandemic should not assume a large 2021 loss shelters wages, portfolio income, or capital gains.

ReadBusiness & Planning

AnalysisJune 20216 min read

The Section 163(j) Interest Limitation Tightens Back to 30% for 2021 — and a Harder Change Looms for 2022

The CARES Act temporarily raised the cap on deductible business interest from 30% of adjusted taxable income to 50% for 2019 and 2020. That cushion is gone. For 2021, the limitation returns to 30% of ATI. Leveraged and capital-intensive businesses will feel a tighter limit this year — and a larger problem is scheduled for 2022, when the depreciation add-back that props up the ATI figure disappears. The time to model both is now, while elections and timing are still in play.

ReadBusiness & Planning

AnalysisMay 20217 min read

A Unanimous Supreme Court Opens the Courthouse Door: What CIC Services Means for Challenges to IRS Reporting Mandates

On May 17, a unanimous Supreme Court held in CIC Services, LLC v. IRS that the Anti-Injunction Act does not bar a pre-enforcement lawsuit challenging an IRS reporting requirement, even though violating that requirement can trigger a tax penalty. The decision is narrow in what it resolves — it is about access to court, not the validity of any particular rule — but its consequence is broad. Taxpayers and advisors can now challenge IRS reporting and disclosure mandates issued without notice-and-comment before they comply, rather than being forced to break the rule or pay first and sue later.

ReadControversy & Compliance

Tax AlertApril 20216 min read

The Filing Deadline Moved to May 17 — but First-Quarter Estimates Did Not

The IRS postponed the 2020 individual filing and payment deadline from April 15 to May 17. The relief is automatic and welcome, but it is also narrower than last year's, and the narrowness is the trap. First-quarter 2021 estimated tax payments stayed due April 15. So did C corporation returns and calendar-year trust and estate returns. A taxpayer who reads "deadline moved to May 17" as a blanket extension can miss a payment that the IRS deliberately left in place.

ReadControversy & Compliance

AnalysisApril 20217 min read

New York Enacts a Pass-Through Entity Tax: How the SALT-Cap Workaround Works, and What Still Awaits Guidance

New York's new elective pass-through entity tax, enacted in the state budget signed April 19, is the state's answer to the federal cap on deducting state and local taxes. The mechanic is sound and the IRS has blessed the structure. But the statute as enacted leaves the first-year operating details — the 2021 election deadline and the 2021 estimated-payment schedule — to forthcoming Department guidance, and owners should plan around the framework now while watching for that guidance before committing.

ReadState & Local

AnalysisMarch 20216 min read

The American Rescue Plan Is Law: A Practitioner's Map of the Tax Provisions in Pub. L. 117-2

The American Rescue Plan Act of 2021 became law on March 11. It is a roughly $1.9 trillion package, and its tax provisions are scattered across more than a dozen sections that affect individuals, families, employers, and the health-insurance subsidy system. This is the orientation piece: what each major provision does, which year it applies to, and where the deadlines and traps already are. The deep dives on the most consequential provisions follow separately.

ReadBusiness & Planning

AnalysisMarch 20211 min read

Decoding the 2021 Employee Retention Credit: Eligibility, Calculations, and the PPP Interaction

The 2021 version of the employee retention credit is materially more valuable than the 2020 version, but it is also easier to misunderstand. Businesses that assumed PPP participation ended the conversation should revisit that conclusion.

ReadBusiness & Planning

AnalysisMarch 20216 min read

The $10,200 Unemployment Exclusion Arrived Mid-Season: Who Should Wait, and Who Still Has to Act

The American Rescue Plan made up to $10,200 of 2020 unemployment compensation tax-free — a retroactive change enacted on March 11, after millions of 2020 returns had already been filed. The IRS has said it will recalculate affected returns automatically, with refunds expected to begin in May. That auto-correction posture is unusual, and it is also incomplete: it does not cover taxpayers whom the exclusion newly makes eligible for credits they did not originally claim. The decision for already-filed taxpayers is when to do nothing and when an amended return is still required.

ReadBusiness & Planning

AnalysisJanuary 20216 min read

The 100% Business Meals Deduction Is Live for 2021 and 2022 — but the Statute Does Not Define "Restaurant"

For 2021 and 2022, business meals provided by a restaurant are fully deductible rather than 50% deductible. The incentive is real and immediate, but the statute Congress passed in late December does not define the one word that decides who captures it — "restaurant" — and the substantiation rules that always governed business meals still apply in full.

ReadBusiness & Planning

AnalysisJanuary 20211 min read

The PPP Deductibility Fix Is Final: What Business Owners Need to Do Before Filing Their 2020 Returns

Congress resolved one of the biggest tax questions left over from 2020: expenses paid with forgiven PPP loan proceeds remain deductible. That reverses the IRS position that many businesses had been preparing around and creates immediate filing and planning implications.

ReadBusiness & Planning

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A development from this year still in play?

Several positions opened in earlier years remain live. If one maps to a decision you are weighing, the conversation worth having is a focused one.

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