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Volume 62, No. 1 April/May 2021
Minnesota Association of Public Accountants
The MAPAN
“MAPA assists members in achieving success in the profession of accounting and taxation through the advocacy of practice rights and the
promotion of high standards in ethics, education, and professionalism.”
Inside this issue: President’s Message
Anybody have a sense of déjà vu? Another year,
another delayed filing deadline.
Hope everyone is doing their best to keep up
with the constant changes and updates of tax
laws, grants, loans, etc., etc. I know in my house I
have been banned from saying PPP and stimulus
money by my better half. She says they get me
too riled up. MAPA has been doing our best to
keep you posted with links to new webinars
regard hot topic issues.
Many of you just received your membership packets recently, as well as our
slate of CPE for the year. As I have said in the past, CPE this year is going to
be very important to keep up with everything. Remember we still have the
expanded child tax credit and advances coming up, which we have received
basically nothing yet for regulations, so stay tuned.
That is all I have for you. Short and sweet, because as I write this the
deadline is only a week away. This will be my last article I write for you. I
can’t believe a year has gone by already. It has been an honor to serve as
your board president. A special thank you to my fellow board members for
all your hard work. Also, a huge thank you Eric Nebben. It was not an easy
task wading through the virtual CPE world and the many changes to how
The MAPAN is the official MAPA operates.
publication of MAPA. The MAPAN
is published five times annually. All
articles must be submitted to the Eric Goddard, CPA
MAPA Office by the 5th of the
month to be included in the following
publication. Submit all articles and
letters to the Editor.
It’s time to renew your MAPA Membership!
You can renew your membership for a
MAPAN EDITOR
PO Box 301 discounted rate of $160. Membership dues
Big Lake, MN 55309
Phone: (612)366-1983 increase on 6/30/21, so if you haven’t done
Fax: (763)263-8020
info@mapa-mn.com so already renew today!
Website: www.mapa-mn.com
The MAPAN
Executive Director’s Report • Erin Nebben, EA
Hello! I hope this newsletter finds you all doing well. It was another tough tax
season for most everyone! I would like to congratulate you all for making it
through and we can only hope that it starts to get better. MAPA has been
diligently working on finding ways to offer more education, as that is so
important with all the updates and changes. We started off the year with offering
a few 2-3 credit webinars, We will continue to add more of this type of education
to our calendar and hope that you are able to take advantage of it. If there is a
topic you would like to know more about, let us know and we will see what we
can do!
Membership packets were all mailed out on April 15th. If you have not received yours yet, please let me
know, and I would be happy to send you another one! We went with a little different format this year and
instead of having multiple brochures, everything on our current calendar is in one catalog. We hope you
like it! And, even more so, we are excited to see you in person soon! As always, feel free to reach out to me
with any questions, comments or concerns, after all, MAPA is YOUR organization.
Legislative Update • Troy Olson, Ewald Consulting
On Monday, May 17, Gov. Tim Walz and legislative complicating the picture is that some of the federal
leaders announced they had agreed on a state conformity issues are retroactive. So at the moment,
budget deal that will provide state tax relief for it appears as though more guidance will be needed
Minnesota’s employers who accepted federal from DOR.
Paycheck Protection Program (PPP) grants and
workers who accepted unemployment payments Both the House and Senate Omnibus Tax bills
during the pandemic. include legislation addressing partnership audits.
Much of the language provides federal conformity .
Unfortunately, the agreement came on the last day
Amongst other provisions, both the House and
of session and tax deadline day and will not become
Senate language allows audited partnerships the
law until a final tax bill is passed in a special session.
election to pay tax at the entity level. Within 180
Most employers have already filed their taxes and it
days of the final adjustment, a partnership must
remains to be seen as to whether they will need to
report the residency status of all direct partners and
file amended returns to take advantage of the
pay tax on the properly allocated and apportioned
tax relief once it becomes law.
share of all income at the highest marginal rate for
its individual and corporate direct and tiered
Also included in the agreement are other federal tax partners.
conformities that will benefit Minnesota taxpayers
and provide some simplification to Minnesota’s tax
The timeline outlined by the Speaker and Sen.
filings.
Majority Leader is that all budget bill spreadsheets
must be agreed upon by May 28, and all policy items
Yesterday there were mixed opinions about how tax by June 4.
filings would be handled. Legislative leaders
commented that they believe filers will have to file
Legislative leaders and the governor anticipate the
amended returns for PPP and UI, but DOR made
legislature will be back in special session in Mid-
comments that they might be able to review and
June after budget details are ironed out to pass the
unilaterally change most filed returns. Also
state budget and adjourn.
Page 2
Volume 62 ,No. 1
NSA State Director Report • Heidi Baublitz, CPA
To say this tax Progressive Field to watch the Cleveland Indians
season was and take on the Texas Rangers. Wednesday, August
still is challenging 25, CPE continues and then in the evening we will
is an be going to the Rock & Roll Hall of Fame, courtesy
understatement. of ACAT. Thursday, August 26, CPE sessions end
From the IRS and then the NSA Governors’ Gala starts at 7:00
changing things PM with dinner and dancing! And you, dressed as
midstream to your favorite rock star! Reserve your room now at
Minnesota not the Hyatt Regency Cleveland at The Arcade. It is
adopting any of located in a landmark building constructed in 1890
the COVID which provides a historic hotel experience with
provisions. This has been a tax season to convenient access to downtown Cleveland.
remember. Hopefully the worst is behind us. The
IRS is also having a hard time keeping up with NSA’s Proposed Bylaw Amendments are available
everything that is going on in the tax world. for your review and voting ends June 4, 2021 at
5:00 PM EST. In 2020, NSA membership voted
The IRS is holding over 29 million returns for overwhelmingly to restructure our governance
manual processing. A combination of the high- from Districts to Regions. These proposed Bylaw
volume of 2020 tax returns requiring manual Amendments also broaden the criteria of NSA
processing, the backlog of unprocessed 2019 paper membership and allow NSA to be a more inclusive
tax returns, congressional mandates to issue professional society representing tax and
economic impact payments (EIPs) and provide accounting professionals. The proposed Bylaw
other relief to taxpayers during the pandemic, Amendments also include moving the
limited resources, and technology issues have responsibility of appointing most NSA committees
contributed to more refund delays and longer appointments from the President to the Executive
refund delays than are typical in a normal filing Committee. These proposed Bylaw Amendments
season. also include the removal of State Directors. This is
the most concerning to me as I would be out of a
The NSA 75th Annual Convention is on for August job! Please take time to review the Proposed
23-26, 2021 in Cleveland, Ohio for in-person Bylaw Amendments and get your vote in.
education, networking, and fun-filled nights!
Monday, August 23, the EA Live Exam Prep On a personal note, I am going to be a grandma
begins its 3-day affair. Then, starting at 6:00 PM, any day now to a new granddaughter. That will
we really kick things off by welcoming you to make 3 granddaughters for me. We are all very
Cleveland with a reception. Tuesday, August 24, excited to finally meet her. I am looking forward
CPE sessions begin, and the EA Live Exam Prep to spending some time away from the office with
Continues. In the evening we will be going to the family and friends.
Page 3
The MAPAN
Peer Review • Mark Hemerick, CPA
Most of our MAPA member firms requiring a When selecting your peer reviewer, you might
peer review have the need for an engagement want to consider a peer reviewer whose practice
review. I will cover these standards here. is similar in size and background to your firm.
Although, the standards for system reviews are
similar. You will need to consider 3 issues in selecting
your peer reviewer.
• MAPA requires the firm to submit a
completed Peer Review Billing Form and 1. Is the peer reviewer independent? Has the
Firm Information Questionnaire before peer reviewer performed any other services
commencement of its peer review. Your peer for your firm since your last peer review?
reviewer will also need a copy of these forms. 2. Does the reviewer perform similar or higher
• The Peer Review Billing Form informs MAPA levels of service than your firm? Does the
of the name of the firm's peer reviewer. It also peer reviewer have knowledge, skills and
determines the firm's fee for MAPA's experience in the levels of service your firm
administrative services. These fees are due by performs?
June 30. 3. Does the peer reviewer have experience in
• The Firm Information Questionnaire requests the industry specialization areas in which
the firm's licensing information, types of your firm is involved?
engagements the firm performs and industry
specialization areas in which the firm is You will also need to complete an Engagement
involved. It also requests the name of the Summary Form for your peer reviewer at the
peer reviewer and the timing of the peer beginning of the peer review process. The
review. Engagement Summary Form should include all
• The Peer Review Billing Form and the Firm of the engagements that you have been engaged
Information Questionnaire are available on to perform for the peer review year.
the MAPA website under the Peer Review
tab. The Engagement Summary Form will require
your firm to organize the listing of your firm's
MAPA is now following the AICPA peer review clients in the following manner:
rules for deadlines. Basically, a peer review
should be completed within 6 months of the 1. By Industry of the Client,
firm's peer review year end. You might consider 2. By Level of Service Provided, and
requesting an extension of time for your firm's 3. By the Responsible Party for the Engagement
peer review if it will be late. For calendar year
end peer reviews, the deadline is June 30. Also, the form requests a copy of your individual
and firm's license.
MAPA will be enforcing this rule. If you are
unable to complete your peer review by the Now is the time to start considering these issues
deadline, you will need to send an extension in preparing for your upcoming peer review.
request before June 30th in order for the MAPA can provide you with a list of its qualified
committee to grant the extension. peer reviewers to get started.
Page 4
Volume 62, No. 1
What’s New at Revenue ● Minnesota Revenue
As we work through
another pandemic-
Paycheck Protection Program (PPP)
lengthened tax season, we Loan Forgiveness
want to thank you for the Under current Minnesota law, forgiven PPP loan
dedication and hard work amounts are considered taxable. Governor Walz's
you do to help latest budget includes an exemption for businesses
Minnesotans accurately to claim up to $350,000 as exempt from income if
prepare and file their their loan is forgiven. Loans of $350,000 or less
taxes. You are essential to represent more than 90% of the number of loans
our mission of working received by Minnesota businesses. For more
together to fund the future for all of Minnesota. information, visit our COVID-19 FAQs for
A year on from when many of us started working Businesses.
from home, or at least drastically changed our work
habits, the resilience of Minnesotans has shined Telephone File and Pay System
through as we continue to adapt to new challenges.
To further this, we want to help keep you informed. Ending
Stay on top of the current information from Revenue has decided not to renew our
Revenue on our website. You can also stay up-to- telephone file and pay system after April 20,
date on the latest changes at Revenue by 2021. The ongoing COVID-19 situation
subscribing to the Updates for Tax Professionals provides a unique opportunity as people are
email list.
more comfortable working online. The decision
was also due to other factors, including
Unemployment Benefits upgraded usability of our online systems and
The American Rescue Plan of 2021 allows for up to
$10,200 ($20,400 for Married Filing Jointly) in the limited number of users. One quick and
unemployment compensation benefits to be efficient alternative to file and pay is e-Services .
excluded from federal adjusted gross income To learn more, visit Options to File and Pay.
(FAGI) for tax year 2020.
Minnesota has not conformed to the American New Local Sales, Use, and Excise
Rescue Plan. In his latest budget proposal, Governor
Tim Walz recommended exemption for up to
Taxes
Le Sueur County will implement a new 0.5%
$10,200 of unemployment compensation benefits
percent transportation tax. The tax applies to sales
received in 2020. We are watching for possible state
and purchases on or after April 1, 2021. This
law changes. Under current law, your clients must
revenue will fund transportation projects within the
include any related federally excluded benefits in
county.
Minnesota adjusted gross income.
To stay up-to-date on new local sales, use, and
excise taxes, see our local Sales Tax Information
page.
EDITORS NOTE: This article was submitted prior to the end of the legislative session on May
17, 2021. Please continue to watch for updates from MAPA and check on the Minnesota
Revenue’s TAX LAW CHANGES webpage as the information regarding the forgiveness of PPP
loans and unemployment benefits develop. Thank you, MAPA.
Page 5The MAPAN
Cost Segregation • Maximizing Expense Deductions with 100%
Bonus Depreciation and Section 179
Recent Tax Laws provide incentives including may be eligible for accelerated depreciation
100% Bonus Depreciation and Section 179. As and 100% bonus depreciation.
a commercial property owner, you are also
allowed to deduct the full amount of certain What does this mean for a building owner?
purchases from your gross income today as You can expense about 30% of your building
opposed to doing so over numerous years. The in the year you buy or build it if a cost
result is more depreciation to offset taxable segregation study is performed. Again, the
income in the beginning years of owning a result is lower income taxes immediately after
new building, a piece of equipment, or applying the bonus depreciation. The
building improvements. This offset means an limitation with bonus depreciation is that it
owner pays less federal taxes. cannot be used more than once on the same
asset. However, if you buy new assets, you can
For example, if your company spends $20,000 take advantage of bonus depreciation again.
on a fork-lift, you would typically write off
$4,000 per year for five years. Bonus In the past, many tax professionals applied
depreciation and Section 179 allow you to Section 179 mainly to equipment or vehicles.
write off the cost of the fork-lift in the first year The Tax Cuts and Jobs Act of 2017 expanded
rather than over numerous years. the definition of Section 179 to include parts of
buildings like roofs, HVAC, fire protection &
Why is this better? If you can write an item off alarm systems, and security systems. These
as an expense, your taxable income decreases, improvements must be made to nonresidential
and you pay fewer income taxes now, giving real property and begun after the building was
you more cash. placed in service for its intended use. Section
179 is an annual election available each year,
What’s the difference between Section but it does have certain spending limitations.
179 and Bonus Depreciation? Spend too much, and you reduce the amount
100% Bonus Depreciation was enacted with of Section 179 you can take or eliminate it.
the Tax Cuts and Jobs Act. If a building is
purchased or constructed after September 27, A Cost Segregation Study is an excellent tool
2017, and has a class life less than 20 years, the to help identify items that might qualify for
asset can receive bonus depreciation. A Section 179 or 100% Bonus Depreciation. Both
building depreciated over 39 years using the are good strategies to help reduce your taxable
straight-line method does not qualify for income and increase cash flow.
bonus depreciation, which is why a cost
segregation study is imperative. Please contact Jodi Nielsen for a free analysis
A cost segregation study will identify assets or to answer any questions.
that can be accelerated into shorter 5-, 7-, and Jodi Nielsen 651-210-1921
15-year class lives. When a cost segregation jodi.nielsen@costsegregationservices.com
study is applied, about 30% of the building www.superiorcostsegregation.com
Page 6Volume 62, No. 1
MAPA 2021 Calendar of Events
Date Topic Time CE Hours
(Central) Type/Location
6/14/2021 Social Security 8am - 4pm 8 Webinar
6/16/2021 Preps, Comps, Review 8am - 4pm 8 Webinar
7/12/2021 Cryptocurrency and 8am - 10am 2
the Gig economy Webinar
7/14/2021 Payroll - Hiring/ 12pm - 2pm 2
Forms/Compliance Webinar
1041's for Trust's & 8am - 4pm 8
7/28/2021 Estates Webinar
8/10/2021 Accounting & Auditing 8am - 4pm 8
Update Webinar
Eldercare Planning 8am - 4pm 16
8/11-8/12/2021 Updates (Part 1) LIVE/Bloomington
9/27-9/28/2021 Business Tax In Depth 8am - 4pm 16 LIVE/ Plymouth
11/3/2021 Federal Tax Update 8am - 4pm 8 LIVE/ Plymouth
11/18/2021 MN Tax Update 8am - noon 4 LIVE/ Plymouth
11/18/2021 Ethics 1pm - 4:30pm 4 LIVE/ Plymouth
12/1-12/2/2021 1040 Tax In Depth 8am - 4pm 16 LIVE/ Plymouth
12/20- 1040 Tax In Depth 7am - 3pm 16
12/21/2021 Webinar
1/4-1/5/2022 1040 Tax In Depth 8am - 4pm 16 LIVE/ Plymouth
WANTED: ACCOUNTING
PRACTICE
Established expanding CPA firm specializing in
small business looking to acquire accounting and
tax practices in the Minneapolis/St. Paul metro
area. If you have a write-up practice for small
businesses, I am very interested. Please call Gary
at 952-484-4343 or email: ghaworth@haworthco.com
Page 7111 Lake Street North
PO BOX 301
Big Lake, MN 55309
Phone: 612-366-1983
Fax: 763-263-8020
Email: info@mapa-mn.com
We’re on the Web!
www.mapa-mn.com
MAPA Committee Chairpersons 2021
Advisory Ethics
Jennifer Schutz, CPA Tim Robinson, CPA Scholarship
schutzcpa@outlook.com trobinson@phbcpa.com Debra Yerys, EA
(651)302-1491 (320)286-5552 dyerys@aol.com
(612)272-3434
ByLaws Legislative/
Jennifer Schutz, CPA MN SBOA Liaison Seminar
schutzcpa@outlook.com Al Maves, CPA Virginia A. Bruns, CPA, EA
(651)302-1491 al@sghw.us vbruns@terningco.com
(507)282-9488 (763)263-3300
Communications, MAPAN, Darrel D. Terning, CPA, EA
Technology, and Public Relations Membership dterning@terningco.com
Nick Kellner Diane St Sauver, CPA (320)587-4916
nick@sghw.us diane@sartelltaxservice.com
(507)282-9488 (320)656-9021 Strategic Planning
Matthew Dahl, CPA Al Maves, CPA
matt@kummetlarsonbluth.com IRS and State Tax Liaison al@sghw.us
(218)829-3585 Jacen Gondringer (507)282-9488
jacen@brainerdcpa.com
Contract Review (218)829-3501 Student Conference
Jennifer Schutz, CPA Kaitlyn Nebben
schutzcpa@outlook.com Nominating knebben@terningco.com
(651)302-1491 Jennifer Schutz, CPA (763)263-3300
schutzcpa@outlook.com
Annual Meeting (651)302-1491 Volunteer Coordinator
Virginia A. Bruns, CPA, EA David Engelking, CPA
vbruns@terningco.com Peer Review david@deeltd.com
(763)263-3300 Mark Hemerick, CPA (651)464-3231
Ellen Stebbins, EA mhemerickcpa@gmail.com
eestebbins@frontiernet.net (320)587-2255
(507)583-6601You can also read
