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May Day—a celebration of the spring season or a distress call? This year with the pandemic and the shutting down of businesses, schools and non-profits, most of us would say it is a distress call. Many people are still waiting on federal stimulus payments, still have not received their unemployment income or are waiting on CARES Act loan applications to be accepted and processed. While we socially distance to prevent the spread of COVID-19, the emotional toll during this time period cannot be underestimated.
Our office has fielded many calls from people wondering when they will get their federal stimulus payment. Some people have received this economic impact payment direct deposited into their bank account and others with the same type tax filing circumstances have not. Looking at the taxpayer circumstances, we cannot determine why this is the case.
The website, irs.gov/coronavirus/economic-impact-payments, that the IRS has for such purposes has not worked or been helpful in many cases. Hopefully, recent upgrades to the website will prove more informative. If the government does not have your bank account, you will be waiting for a paper check that will take months to receive. Check your 2018 and 2019 tax return to see what bank account, if any, you used. Go to the IRS.gov website to update your bank information, if needed.
The last few weeks, our office has focused on helping self-employed people and small business owners compile the information necessary to file for unemployment and for applying to the Paycheck Protection Program (PPP). For owners of businesses, fortunately there is now a round two with more funds available for this program that a business owner applies for through their bank. Once these business owners receive their PPP loan, there are important steps to take to track those funds in their businesses and potentially get some or all of it forgiven. If not, it is a loan to be paid back in two years.
It is highly recommended that businesses consult with their CPA or accounting professional and their bank to make sure they are properly taking steps to use 75 percent or more of these funds for payroll and that full-time-equivalents for employees meets requirements. Small businesses can also apply for the Economic Injury Disaster Loan (EIDL) through the Small Business Administration website. However, there are less funds available in this program and it takes months to receive. Let us hope that the eventual reopening of our economy and the CARES Act funding comes soon enough to help people pay for living costs.
With the CARES Act questions and information requests we have received, our firm is thankful that the April 15 tax deadline has been moved to July 15. We are working hard to get all 2019 tax returns completed as soon as possible.
We are forever grateful for our medical professionals and care-givers who are serving on the front lines of this pandemic.