Dear Clients, Friends and Fellow Entrepreneurs,<\/p>\n\n\n\n
Credit to Hector Garcia, CPA who got us all together group sourcing a\ndocument in Google Docs real -time. It\nwas pretty incredible, edits happening simultaneously from all over the\ncountry. Here is what we came up with.<\/p>\n\n\n\n
As accounting professionals, tax preparers, and members of the small\nbusiness community, we strive to give the most concise and practical list of\nitems for small business owners and\/or taxpayers related to the Federal\nstimulus package and economic developments from COVID-19. This email contains a lot of information, so here is a quick table of\ncontents of what will be covered:<\/p>\n\n\n\n
Individual and Corporate (C-Corporations) tax returns for 2019 have\nbeen extended to 7\/15\/2020. The\nextension is both to file and pay. \nEither way, we would suggest filing an extension by 4\/15 to extend the\ntime to file through October 15th, 2020; keeping in mind that the payment is still due on\n7\/15 nonetheless.<\/p>\n\n\n\n
\nWith that being said, it is imperative that you file your 2019 tax returns ASAP\nif you can. If you file your tax return promptly, you avoid someone trying to\nsteal your identity by filing it before you. \nWith all the \u201cfree money\u201d being touted by the US Government, tax scams\nwill be at an all-time high! Do not\nworry about whether your 2019 income is higher than 2018 for the purpose of\ngetting your stimulus check, just file your 2019 ASAP if you haven\u2019t done\nso. I will explain more details about\nthis.<\/p>\n\n\n\n
According to the new law, the intention is to give most adult\nAmericans a $1,200 stimulus check to encourage them to stay at home and\/or to\npay their bills during these difficult times. The check that you may receive is\nan advance on a tax credit on your 2020 tax return. At the end of 2020, the tax credit will be based on the\n2020 income. Here is how it works:<\/p>\n\n\n\n
Note: The amount of the payment to be advanced during April 2020, is\ngoing based on 2018 or 2019\u2019s tax return information. BUT, since it is\nconsidered to be a refundable tax credit for the year 2020; your final income\nfor 2020 will determine real eligibility; so if in 2020 your income is higher,\nYOU MAY HAVE TO PAY BACK ANY ADVANCE THAT YOU RECEIVE. On the other side of the coin, if you do not\nget the money upfront, but still qualify because of income levels, you will get\nit as a tax refund or reduction of your 2020 income tax liability.<\/a>[1]<\/a> <\/p>\n\n\n\n Whether you think you qualify for this or not, we still advise that\nyou file your 2019 tax returns with direct deposit information ASAP, so the IRS\ncan have your accurate information. Have\nyou moved in the past year? If you need\nto change your address with the IRS, fill out <\/a>Form\n8822<\/strong><\/a> and mail it to them ASAP.<\/p>\n\n\n\n Note: we are getting bombarded\nwith questions related to these payments, we do NOT have a mechanism to request\nthe money and\/or check payment status or verify eligibility. The only thing we can do is file your tax\nreturns ASAP to have you compliant. \nThere is no direct information from the IRS. For more information, check\nout their COVID-19 page: <\/a>https:\/\/www.irs.gov\/coronavirus<\/strong><\/a><\/strong><\/p>\n\n\n\n Meanwhile, The New York Times has\na really good\n<\/a>FAQ\narticle<\/strong><\/a> on this. It\nspecifically answers questions about non-filers and folks on social security.<\/p>\n\n\n\n This video by Hector Garcia, CPA: <\/a>https:\/\/youtu.be\/jSgWMLLE5GE<\/strong><\/a> shows some tips\nto prepare prior to applying for a loan. \nIn a nutshell, you need to have all your latest tax returns filed, your\nbookkeeping organized and up to date, and a sound business plan as to how the\nloan will be used.<\/p>\n\n\n\n Download the SBA Disaster loan package and checklist:<\/p>\n\n\n\n SBA Document Folder<\/a><\/p>\n\n\n\n Paycheck\nProtection Program FAQs for Small Business<\/a><\/p>\n\n\n\n Depending on the requested loan\namount and cash flow requirements, the SBA will offer you the type of loan that\nseems fitting for your situation (there\nare two types: 1) \u201cDisaster Relief Loan\u201d, and 2) \u201cPaycheck Protection\nLoan.\u201d. Right now there is no mechanism\nto choose the type of loan; however, only the latter may potentially qualify\nfor debt forgiveness. Our suggestion is\nto start the process and apply for whatever is available via the SBA.gov\nwebsite (there might be some additional guidance in the near future for\napplying for the two types of loans separately) – either way, it’s valuable to\nstart gathering the documentation and required information. If you need\nassistance to get all your accounting data caught up, we are offering special\npriority service to help expedite the process; we will price it individually\nbased on where your bookkeeping\/accounting\/tax is currently. We brought in some additional bookkeeping\nsupport help for the next few months to accommodate our clients.<\/p>\n\n\n\n There is language in the law that some of these SBA loans will qualify\nfor forgiveness up to the amounts used to pay payroll, keep employees on staff,\nand pay essential expenses to \u201ckeep the doors open they are calling this\nPaycheck Protection Program (PPP) There is no official federal government\nwebsite with the specific mechanics on how debt forgiveness will work, or how\nto apply for this – our guess is those details are coming soon. Our suggestion is to start the application\nprocess with the SBA first, then worry about those details later; always get the loan with the intention to\npay it back.<\/strong> This PPP loans will be limited to 2.5x your monthly payroll\nand related costs: direct employee benefits, rent, utilities, and essential\npayables prior to the covered period. \nThe period that will be reviewed is February 15th<\/sup> through\nJune 30th<\/sup>, 2020. You must have\nhad employees prior to Feb 15th<\/sup>. \nRight now clean and complete accounting records are of the essence to\napply for these loans.<\/p>\n\n\n\n The Office of the Florida Senate has published this FAQ sheet: This is a great document from The US Chamber of commerce summary in PDF<\/a> on SBA Loans, Payroll requirements, and debt forgiveness.<\/p>\n\n\n\n For small businesses with employees, there will be a payroll tax\ncredit applied to future 941 forms, that will allow the small business to keep\nthe 6.2% portion of the social security tax paid by the employer. In addition, employers will be able to delay\nthese payments through 2021, essentially giving the small business an\ninterest-free loan on the payroll taxes. \nThe instructions, forms, and\/or mechanisms to do this are not yet\navailable from the IRS. If we manage\nyour payroll, rest assured we will be on top of these credits. If you outsource your payroll with a payroll\nservice, make sure you lean on them for the guidance on this and MAKE SURE they\nare being proactive with this. You should not feel that you need to chase them\ndown for these credits. What we do know,\nis that you would need to keep your\nemployees and\/or not reduce the overall wages in order to get these credits<\/strong>. We also know that this will be an either\/or\nsituation where you can either take the payroll tax credit OR the Loan Debt\nForgiveness we described above.<\/p>\n\n\n\n Specifically, for government grants, we are not aware of any specific\ngrants or \u201cfree money\u201d out there for distressed individuals, communities, or\nbusiness or at least the ones in which an accountant would have the mechanism\nto arrange on their client\u2019s behalf. \nHowever, these resources might be worth checking out:<\/p>\n\n\n\n Be aware of the surge of cyber-attacks and phishing emails roaming\naround, hackers\/scammers know that many people are working from home,\nconnecting to their office computers remotely, and using many new\ntelecommunications apps for the first time. New users are much more susceptible\nto confusion and\/or not knowing which legitimate communication apps to use and\nwhat features are appropriate. Do not\nopen emails you do not recognize! Do not download any new apps without consulting\na competent IT professional. Scammers\nwant to steal your identity and\/or install ransomware on your computers. Google \u201cransomware\u201d and you will see what we\nare talking about.<\/p>\n\n\n\n Additionally, beware of \u201cSBA Loan Officers\u201d that contact you, there\nwill be a stream of people claiming to work for the SBA, the Government, or a\nLending institution to help you secure a loan or grant linked to the stimulus\npackage that just passed. Do not give\nyour financial info, tax returns, etc. to just anyone. Do not upload those documents to any random\nwebsite unless you use your Bank\u2019s secure portal or SBA.gov directly.<\/p>\n\n\n\n If you are struggling to make ends meet, proactively call all your\nvendors and debtors, tell them you are temporarily strapped for cash… or\nsimply say: \u201cdo you have any programs to reduce my services to a minimum?\u201d,\n\u201cHow can I pause my services?\u201d, or \u201cHow can I defer my payments for the\nmoment?\u201d – You will be surprised how many of your vendors will be flexible and\ngo through great lengths to keep you as a customer!<\/p>\n\n\n\n We apologize in advance that we are NOT going to have all the answers\nregarding this stimulus package. If you\nask a question for which we do not have the answer, we will be brutally honest\nand tell you. If a new important\ndevelopment arises, we will be proactive with a follow-up email.<\/p>\n\n\n\n Our colleague Hector Garcia, CPA, has produced a few videos to help\nfriends, colleagues, and fellow entrepreneurs make more sense of these times:<\/p>\n\n\n\n Lastly, no amount\nof money is worth a life… stay home and stay safe!<\/em><\/p>\n\n\n\n Thank you, and don\u2019t forget that you have friends here. You can\ncontact us anytime for any questions and\/or to just chat about the issues you\nmight be going through.<\/p>\n\n\n\n Tricia O\u2019Connor, CPA MBA<\/p>\n\n\n\n O\u2019Connor & CO CPAs<\/p>\n\n\n\n Tricia@OConnorCPAFirm.com<\/p>\n\n\n\n 303-515-9390 Google # which emails me immediately <\/p>\n\n\n\n <\/p>\n","protected":false},"excerpt":{"rendered":" Concise and Practical Information of Covid-19 Resources for Businesses and Individuals<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4,157],"tags":[212],"yoast_head":"\nDisaster Relief –\nSBA Loans for small businesses<\/strong><\/h3>\n\n\n\n
Notes\non \u201cDebt Forgiveness\u201d from these loans:<\/em><\/strong><\/h3>\n\n\n\n
\nhttp:\/\/www.bit.ly\/PPPsenate<\/a><\/p>\n\n\n\nFAQ Document from the US Chamber of Commerce<\/h3>\n\n\n\n
Tax Credits,\nGrants and other helpful resources<\/strong><\/h3>\n\n\n\n
Other Misc. Tips\nand Resources<\/strong><\/h3>\n\n\n\n
\n\n\n\n