The U.S. president has signed into law the “Consolidated Appropriations Act, 2021.” The legislation includes a number of tax provisions, and also includes COVID-19 relief legislation, which provides individuals and certain employers detrimentally impacted by the coronavirus pandemic with welcome financial support. The tax measures (e.g., extenders) in the consolidated appropriations legislation may help individuals with various deductions, exclusions, and credits, which could help them reduce their tax liability. The provisions that are most likely to impact global mobility programs and international assignees are highlighted in this GMS Flash Alert.
On December 27, 2020, U.S. President Donald J. Trump signed into law the “Consolidated Appropriations Act, 2021.”1 The legislation includes additional coronavirus (COVID-19) relief that expands upon the relief provided in the “Coronavirus Aid, Relief, and Economic Security Act” (CARES Act)2 and a number of tax provisions. Accordingly, the date of enactment is December 27, 2020.
The COVID-19 relief legislation provides individuals and certain employers detrimentally impacted by the coronavirus pandemic with welcome financial support to help with the maintenance of their households and businesses and support the wider economy. Individuals and employers should familiarize themselves with the measures and assess the eligibility requirements.
The tax measures (e.g., extenders) in the consolidated appropriations legislation may help individuals with various deductions, exclusions, and credits, which could help them reduce their tax liability. They could affect the overall costs of international assignments.
The legislation includes a number of tax provisions. The provisions that are most likely to impact global mobility programs and international assignees are highlighted below. For a detailed discussion of the following highlighted provisions see GMS Flash Alert 2020-504 (December 23, 2020).
The legislation includes the “COVID-Related Tax Relief Act of 2020.” The tax provisions in this part of the legislation that may be of most interest to global mobility professionals and assignees include:
The legislation makes permanent certain expiring tax incentives and provides temporary extensions (for varying periods of time) for other expiring provisions.
Selected provisions that are made permanent include:
Selected provisions that are extended for five years (through 2025) include:
Certain provisions extended for three years (through the end of 2023) include:
Selected provisions extended for one year include:
The legislation contains a number of miscellaneous tax provisions and temporary provisions relating to COVID-19 relief including:
The legislation provides disaster tax relief for individuals and businesses in presidentially-declared disaster areas for major disasters declared (other than COVID-19) after December 31, 2019, through February 25, 2021 (60 days after December 27, 2020 (the date of enactment)). In part, these provisions:
The legislation also includes several compensation and benefits-related tax provisions, including expansion of the employee retention credit through June 30, 2021 (from January 1, 2021). For a summary of these provisions, see KPMG LLP’s TaxNewsFlash 2020-774 (December 22,2020).
The above information is not intended to be "written advice concerning one or more Federal tax matters" subject to the requirements of section 10.37(a)(2) of Treasury Department Circular 230 as the content of this document is issued for general informational purposes only.
The information contained in this newsletter was submitted by the KPMG International member firm in the United States.
To subscribe to GMS Flash Alert, fill out the subscription form.
© 2021 KPMG LLP, a Delaware limited liability partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
For more detail about the structure of the KPMG global organization please visit https://home.kpmg/governance.
Flash Alert is an Global Mobility Services publication of KPMG LLPs Washington National Tax practice. The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.