To help people and businesses facing the challenges of COVID-19 issues, the US Government announced a sweeping series of steps to assist taxpayers by providing relief on a variety of issues ranging from easing payment guidelines to postponing compliance actions. I have outlined some of the major pieces of relief below. As more information is available or changes check back and I will update.
- Economic Impact Payments – All individuals and households making under certain thresholds will direct payments from the US Government. Non-filers can head over to the IRS WEBSITE to enter information in order to provide the IRS the information they need to issue you your EI Payment. All other filers in the coming days will be able to check the status of their EI payment and update address and direct deposit info. Stay tuned and we will post a link as soon as it is available.
- People First Initiative – The IRS has taken steps to ease payments for existing installment agreements and offer in compromise. They are also suspending many enforcement actions such as liens and levies. They will also not be initiating any new audits during this period.
- Tax Day Moved to JULY 15 – The IRS has moved the filing and payment deadline 90 days. There will be no penalties and interest charged during this time period and there is no need to file an extension.
- The Employee Retention Credit – A refundable tax credit against certain employment taxes equal to 50% of the qualified wages an eligible employer pays to employees after March 12, 2020 and before January 1, 2021. You can get immediate access to the credit by reducing the employment tax deposits you are otherwise required to make. (Can’t take this if you take the PPP)
- Paid Leave Tax Credit – Gives all American businesses with fewer than 500 employees funds to provide employees with paid leave, either for the employee’s own health needs or to care for family members.
- Economic Injury Disaster Loan Emergency (EIDL) Advance (Lapse in Appropriations) – This is to provide economic relief to businesses that are currently experiencing a temporary loss of revenue. Funds will be made available following a successful application. This loan advance will not have to be repaid. If a business also applies for the PPP, the amount of advance received reduces the amount of eligible forgiveness under the PPP.
- The Payroll Protection Program (PPP) (Lapse in Appropriations) – A loan program through the SBA that allows small employers to borrow up to 2.5 times their average monthly payroll and if employees are retained and the business spends the loan proceeds are qualified expenses the business can apply for forgiveness.