Adjust your expectations of business interruption coverage
If you maintain business interruption insurance for your company, you may wonder whether the COVID-19 pandemic is an “applicable event” that would enable you to file a claim and receive a payout. Many insurers are saying no, claiming the “force majeure” legal defense. This means unexpected external circumstances are preventing them from meeting their obligations. They also argue that the COVID-19 crisis doesn’t qualify as a physical loss. Lawsuits have already been filed challenging their position. To decide whether to proceed with a claim, review your policy carefully and be prepared to document the adverse financial impact of the pandemic on your company. Contact us for help.
Answers to questions you may have about Economic Impact Payments
Millions of eligible Americans have already received their Economic Impact Payments (EIPs) via direct deposit or paper checks, according to the IRS. Others are still waiting. The payments are part of the CARES Act. Is there a way to check on a payment status? A new IRS tool called “Get My Payment” shows taxpayers either their EIP amount and the scheduled delivery date, or that a payment hasn’t been scheduled. It also allows taxpayers who didn’t use direct deposit to provide bank account details. Some people are getting an error message (“payment status not available”). Hopefully, the IRS will have it running seamlessly soon. Access the tool here: https://bit.ly/2ykLSwa
New COVID-19 law makes favorable changes to “qualified improvement property”
A law providing relief due to the coronavirus (COVID-19) crisis contains a valuable change in the tax rules for improvements to interior parts of nonresidential buildings. You may recall that under the Tax Cuts and Jobs Act, any qualified improvement property (QIP) placed in service after Dec. 31, 2017 wasn’t eligible for 100% bonus depreciation. The cost had to be deducted over 39 years rather than entirely in the year the QIP was placed in service. This was due to a drafting error by Congress. But the new CARES Act now allows most businesses to claim 100% bonus depreciation for QIP as long as requirements are met. The correction is retroactive to QIP placed in service after Dec. 31, 2017.
Mapping Out Your SBA PPP Loan Forgiveness Strategy
So, you’ve applied for and been approved for a Payroll Protection Program loan. Now what? The next 8 weeks are crucial to maximize your eligible loan forgiveness. This is the time to map out your strategy! A few things to note and some things that still need to be clarified: For any amount of your […]
COVID-19: IRS announces more relief and details
In the midst of the coronavirus (COVID-19) pandemic, Americans are focusing on their health and financial well-being. To help with the impact facing many people, the government has provided a range of relief. On its Twitter account, the IRS announced that it deposited the first Economic Impact Payments into bank accounts on April 11. “We know many people are anxious to get their payments; we’ll continue issuing them as fast as we can,” the agency added. There’s also a new online tool on the IRS website for people who didn’t file a 2018 or 2019 federal tax return because they didn’t have enough income or otherwise weren’t required to file. You can access the tool here: https://bit.ly/2JXBOvM
What are the key distinctions between layoffs and furloughs?
As businesses across the country grapple with the economic fallout from the coronavirus (COVID-19) pandemic, many are facing the difficult choice of whether to lay off employees or furlough them. Layoffs are the ostensibly permanent termination of employees, while a furlough is a mandatory or voluntary suspension from work without pay for a specified period. Before furloughing workers, investigate whether you need to remit a “final” paycheck and how medical coverage is affected under COBRA and the Affordable Care Act. If you’re a midsize employer thinking about layoffs, be sure to comply with the Worker Adjustment and Retraining Notification Act. Contact us if you need assistance.
IRS announcing that second quarter estimates are extended from June 15 to July 15
IRS extends more tax deadlines to cover individuals, trusts, estates corporations and others IR-2020-66, April 9, 2020 WASHINGTON — To help taxpayers, the Department of Treasury and the Internal Revenue Service announced today that Notice 2020-23 (PDF) extends additional key tax deadlines for individuals and businesses. Last month, the IRS announced that taxpayers generally have until July […]
Relief from not making employment tax deposits due to COVID-19 tax credits
The IRS has issued guidance providing relief from failure to make employment tax deposits for employers entitled to refundable tax credits provided under two laws. The two laws are the Families First Coronavirus Response Act and the Coronavirus Aid, Relief, and Economic Security Act. Under the laws, the penalty for failure to deposit the employer share of Social Security tax is waived in anticipation of the allowance of the refundable tax credits. IRS Notice 2020-22 provides that an employer won’t be penalized for failing to deposit employment taxes related to qualified leave or qualified retention wages in a calendar quarter if certain requirements are met. Contact us for more information.
Just launched: The SBA’s Paycheck Protection Program
To mitigate unemployment caused by the coronavirus (COVID-19), the Small Business Administration has launched the Paycheck Protection Program (PPP). Eligible participants may qualify for loans of up to $10 million determined by eight weeks of previously established average payroll. If the recipient maintains its workforce, up to 100% of the loan is forgivable if the loan proceeds are used to cover the first eight weeks of payroll, rent, mortgage interest or utilities. Eligible recipients are small businesses with fewer than 500 employees, as well as certain other employers. The PPP begins retroactively on Feb. 15, 2020, and ends June 20, 2020. Contact us for more information.
You must be logged in to post a comment.