CORONAVIRUS (COVID-19) TAX UPDATES
TAX RETURN AND TAX PAYMENT EXTENSIONS: The Treasury Department and Internal Revenue Service announced on March 21, 2020, that the federal income tax filing due date is automatically extended from April 15, 2020, to July 15, 2020. As of April 9th, this extension to July 15th is also extended to those individuals, estates, trusts, etc. with a normal tax deadline between April 1st and July 15th.
Taxpayers do not need to file any additional forms or call the IRS to qualify for this automatic federal tax filing and payment relief. Individual taxpayers who need additional time to file beyond the July 15 deadline, can request a filing extension by filing Form 4868 while businesses who need additional time must file Form 7004.
The IRS urges taxpayers who are due a refund to file as soon as possible. Most tax refunds are still being issued within 21 days.
Taxpayers can also defer federal income tax payments (including estimated tax payments) due on April 15, 2020, to July 15, 2020, without penalties and interest, regardless of the amount owed. This deferment applies to all taxpayers, including individuals, trusts and estates, corporations and other non-corporate tax filers as well as those who pay self-employment tax.
Please see the IRS page HERE for more info.
ECONOMIC IMPACT PAYMENT FOR INDIVIDUALS: Eligible taxpayers who filed tax returns for either 2019 or 2018 will automatically receive an economic impact payment of up to $1,200 for individuals or $2,400 for married couples. Parents also receive $500 for each qualifying child.
Tax filers with adjusted gross income up to $75,000 for individuals and up to $150,000 for married couples filing joint returns will receive the full payment. For filers with income above those amounts, the payment amount is reduced by $5 for each $100 above the $75,000/$150,000 thresholds. Single filers with income exceeding $99,000 and $198,000 for joint filers with no children are not eligible.
Please see the IRS page HERE for more info.
PAID SICK LEAVE (PSL) AND CHILD CARE LEAVE (CCL) CREDITS: On March 20, 2020 the U.S. Treasury Department, Internal Revenue Service (IRS), and the U.S. Department of Labor (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 Coronavirus-related leave to their employees.
Please see the IRS page HERE for additional details.
THE CORONAVIRUS AID, RELIEF, AND ECONOMIC SECURITY (CARES) ACT: On March 27th, the CARES Act was signed into law giving a $2.2 trillion stimulus to US Individuals and businesses including $350 billion set aside for the SBA (Small Business Administration) to provide loans to small businesses to keep workers employed and their doors open.
These loans may be forgiven if the small business meets certain requirements and the loan is spent on approved expenses.
Some of the eligibility requirements include:
In order to qualify, the lender will look for:
The maximum amount a small business can borrow is 2.5x of the average monthly payroll costs, not to exceed $10 million.
The loan can be forgiven if spent on the following during the 24 week period (originally 8 weeks) following the loan origination, though no later than December 31, 2020:
Please see the US Chamber of Commerce flyer for additional details.
For the most up-to-date information, visit the IRS Coronavirus page at https://www.irs.gov/coronavirus.
If you have any questions, please feel free to give us a call at (386) 760-3083.
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