May 15, 2020
Dear Clients and Friends,
The new $3 trillion coronavirus relief bill titled The Heroes Act is expected to pass the House of Representatives today. However, it’s fate will be determined in the Senate. The Act is expected to ultimately pass but with significant modifications. It includes funding for additional economic Impact/stimulus payments, the Payroll Protection Program (PPP,) the extension of $600/week unemployment benefits through January 2021, first-responder hazard pay, Covid-19 treatment and testing, and economic relief for the states. The bill is highly politicized and will be subject to intense partisan debate as it makes its way through the Senate. I would also like to pass along an update on other Covid-19 financial matters that may impact you:
- Nevada gig workers able to file for Unemployment starting Saturday (LV Review Journal, May 14, 2020) : This is for the long-waited federally-backed ($600/week) program for those self-employed, 1099 contract workers and gig workers who otherwise don’t qualify for unemployment benefits based on the state formula. Check their website Saturday for eligibility criteria at https://detr.nv.gov/Page/COVID-19_(Coronavirus)_Information_for_Claimants_and_Employers. Note that you can apply for retroactive benefits even if you are currently working. Payments will be backdated to the filer’s date of eligibility, which can go as far back as January 27.
- Economic Impact /Stimulus Payments: IRS has improved their “Get My Payment” web portal on their website. Go to https://www.irs.gov to check your status. The pending HEROES Act bill is proposing another $1,200 stimulus payment for each family member in a household, totaling up to $6,000.
- Paycheck Protection Program (PPP): $140 billion of funds are reportedly still available. The application process has slowed down a bit from the initial feeding frenzy and the average loan size has dropped dramatically as more smaller businesses and self-employed individuals have been funded and large companies that received negative publicity have returned loans. The Heroes Act includes funding to further extend the program. Please contact me with any questions if you haven’t applied yet.
We are awaiting more guidance related to the loan forgiveness details any day now. The AICPA (industry trade group for CPAs) is lobbying for several clarifications including an extension of the 8 week period to spend the loan money on payroll and to start the period on the date the states reopen rather than the date the loan was received.
Treasury released a clarification this week providing a safe harbor for loans less than $2 million related to the good faith certification that the PPP loans were necessary to the business continuity. For more info, see link to a good article here:
- SBA Economic Injury Disaster Loans (EIDL) This SBA loan program received significantly less funding than PPP and is currently closed to new applicants outside of the agriculture industry. SBA is extremely backlogged on processing the remaining applications, but I do know personally of people who have received the smaller advance portion and larger loan proceeds.
Good summary article here updating the PPP and SBA EIDL programs: https://www.forbes.com/sites/allbusiness/2020/05/11/loan-forgiveness-ppp-sba-eidl-programs/
- IRS July 15th Tax Deadline: Rumors are flying that the IRS July 15 tax deadline will be extended to at least September 15. This would include extending the deadline to file and pay 2019 taxes and likely 2020 estimated tax. Opponents of additional extensions cite the concern of creating a massive “balloon” payment of accumulated taxes for multiple tax periods. Stay tuned.
Please contact me with any questions, stay safe and have a great weekend!
Eric Johnson, CPA
Tel. (702) 941-7787