This post updates previously published content regarding legislation that would raise the threshold for nonprofit audits from $500,000 to $1M. Assembly Bill 4635 (AB4635) passed the New Jersey legislature on December 20, 2021, and now heads to Governor Murphy for further action.

The conditions created by the COVID-19 pandemic forced many businesses to make changes to adapt to the “new normal.” For example, the stay-at-home orders, social distancing requirements, and other customer/employee safety measures resulted in limiting the number of employees on the production floor, installing new barriers to prevent transmission, adding sanitization protocols, and much more. At the same time, office buildings were virtually empty as employees were permitted to work from home under remote work policies.

The Biden Administration’s Build Back Better Act (the Act) is designed to reduce costs, create new jobs, and cut taxes for working families. In addition, there are proposed investments in health and childcare, higher education, workforce training, and teachers and schools. The cost of the legislation, which is estimated at $3.5T, will be paid for by increased taxes on corporations and the wealthiest Americans.

Since earlier this year, the Biden Administration has been pursuing a legislative agenda that focuses on COVID-19 economic recovery and re-energizing the American economy. It started with the American Rescue Plan Act and has continued with several other proposals culminating in the Build Back Better Act (the Act). The Act is designed to reduce costs, create new jobs, and cut taxes for working families. There are proposed investments in health and childcare, higher education, workforce training, and teachers and schools.

Recently, the IRS announced that victims of Hurricane Ida in various parts of New Jersey, New York, and Pennsylvania now have until January 3, 2022, to file individual and business tax returns and make certain tax payments.  The tax relief is being offered to taxpayers in any areas designated by the Federal Emergency Management Agency (FEMA) as qualifying for individual or public assistance.

The U.S. Small Business Administration’s (SBA), 8(a) Business Development Program, offers disadvantaged small businesses access to sole source and other government contracts. Program participants enjoy several benefits that make it easier to win work with the federal government, the details of which we have summarized below.

When the COVID-19 pandemic hit New Jersey in March 2020, many businesses were forced to close for a time, causing unemployment claims to spike.  More than 2 million state residents have filed for unemployment since the start of the pandemic, and over $33B in state and federal benefits have been paid out.  As a result, the state’s Unemployment Trust Fund (UT Fund) has been severely depleted, and the state was forced to borrow from the federal government to keep paying claims.

The issue of proper worker classification continues to be an area of concern for both federal and state governments, primarily because when someone is misclassified as an independent contractor rather than an employee, the tax liabilities shift from the business to the individual. In addition, independent contractors are typically not entitled to the same benefits as employees, resulting in an overall lower cost. Thus, despite existing regulations, worker misclassification is a continuing concer

Have you made any large out-of-state purchases for yourself or your business this year? If so, you may have to pay New Jersey Use Tax. Use Tax applies when a purchase is made outside of New Jersey (be it online or via mail) for use in New Jersey and is taxed at the same rate as New Jersey sales tax: 6.625%.

In New Jersey, nonprofit organizations that reach a specific threshold of the gross revenue received must comply with certain reporting requirements, including the mandatory submission of an audit conducted by an independent certified public accountant.