COVID-19 Tax Update
Updated: Jun 24, 2021
Tax Filing and Payment Relief
The U.S. Treasury and the Internal Revenue Service extended the filing and payment deadline from April 15, 2020 to July 15, 2020. The Treasury Secretary has encouraged taxpayers who may have refunds to continue working towards filing their returns in order to access the refunds (that sounds scary - kind of like they’re saying they might run out). Some states have followed suit but not all.
I will write a whole newsletter on the SBA loans but know that there is now $8 Billion available to small businesses in ALL 50 states and the rates are pretty darn good. Look, I’m not one for debt but if you don’t have enough cash in your business to make it through until August, an SBA loan may be a good option. It’s going to be a competition to who gets it first and there is a bunch of financial information that you have to have in order but I can help you with that.
Payroll Tax Credits
The IRS and Department of Labor announced that small and midsize employers can begin taking advantage of two new refundable payroll tax credits, designed to immediately and fully reimburse them, dollar-for-dollar, for the cost of providing Corona-related leave to their employees. The key takeaways:
Paid Sick leave for Workers - For COVID-19 related reasons, employees receive up to 80 hours of paid sick leave and expanded child care leave when employees’ children’s schools are closed and child care providers are unavailable.
Complete Coverage - Employers receive 100% reimbursement for paid leave pursuant to the Act.
Health insurance costs are also included in the credit. Employers face no payroll tax liability.
Self-employed individuals receive an equivalent credit.
Fast Funds - Reimbursement will be quick.
An immediate dollar-for-dollar tax offset against payroll taxes will be provided.
Let’s chat if you need assistance with these payroll tax credits.
Potential cash payments coming - as of Sunday night, this bill failed to advance to the Senate
I’m always here if you just need someone to talk to about what the heck is going on in the world - COVID or not.