Coronavirus and Stimulus Package Update

The impact of the Coronavirus (COVID-19) is changing rapidly and all of us at A&CO are praying for the safety of your family and ours.  Even though our first priority is our safety, life goes on and recent events have affected the way we and our clients work.  Please see below for current information regarding the April 15th tax deadline, our office procedures, small business funding resources, and the stimulus package that is expected to pass this week.  There is some free money on the table for businesses and individuals, and we don’t want you to miss it.

APRIL 15 TAX INFORMATION

• The deadline to file your 2019 Form 1040 (individual income tax return) has been extended from April 15 to July 15.
• If you owe, the tax payment deadline has also been extended to July 15, without accruing penalties and interest.
• The deadline to contribute to your 2019 IRA or HSA has also been extended to July 15.
• The first quarter 2020 estimated income tax payments deadline has also been extended to July 15; however, the second quarter 2020 estimate income tax payments deadline is currently still June 15.
• The IRS will continue to carry out “mission critical” functions, including processing tax returns and issuing refunds.  If you anticipate a refund, we recommend filing those returns as you normally would or earlier.

OUR OFFICE/TAX FILING PROCEDURE UPDATE

While our office is currently closed to clients and visitors, we can still prepare your tax return!   

• Upload tax documents to the client portal and complete your web organizer.
• Drop off hard copies by sliding tax documents under our office door.
• Schedule a phone call or online meeting via Zoom or Skype.

STIMULUS PACKAGE

The massive $2 trillion stimulus package is designed to help the public and the economy rebound from the coronavirus pandemic.   Here is what we expect to see:

Small Businesses

• Will receive emergency loans if they keep their workers.
• The bill provides federally guaranteed loans available at community banks to small businesses that pledge not to lay off their workers.
• The loans would be available during an emergency period ending June 30 and would be forgiven if the employer continued to pay workers for the duration of the crisis.

Individuals

• Cash payments of $1,200 per adult and $500 per child to qualifying households
• Payments begin to phase out for individuals with adjusted gross income > $75,000 and $150,000 for married filers and $112,500 for head of household.
• Family of 4 could receive $3,400

Unemployment

• Insurance extension to four months, bolstered by $600 weekly.
• Eligibility would be expanded to cover more workers.  
• You may not need to lose your job to qualify.  If you’re quarantined or furloughed and you’re not being paid but expect to return to your job eventually you may qualify.

SMALL BUSINESS RESOURCES

We have compiled a list of funding resources that might help with your cash flow needs during these uncertain times. Some of these resources may require financial statements. If you’re an accounting client with us, we can likely generate the necessary reports out of QuickBooks. If you are not our accounting client, we still may be able to help. 😊

U.S. Small Business Administration (SBA) Economic Injury Disaster Loans

The SBA is providing low interest working capital loans of up to $2 million to small businesses and nonprofits affected by the Coronavirus.  These loans carry an interest rate of 3.75% for small businesses and 2.75% for nonprofits. Loan repayment terms vary by applicant, up to a maximum of 30 years.   Read an overview of the program here.

Who’s Eligible

Businesses in every state.  You can use the loan to cover accounts payable, debts, payroll and other bills the Coronavirus has affected your ability to pay.

How to Apply
Apply online and select “Economic Injury” as the reason you’re seeking assistance.

Items you may need to apply:

• Most recent federal income tax return for your business
• Signed IRS Form 4506-T – for owner(s) and the business
• Owner(s) personal financial statement
• Form with business name, address, organization structure, and ownership structure
• Profit & Loss and Balance Sheet financial statements (potentially)

Call the SBA Disaster Assistance Customer Service Center at 1-800-659-2955 for help with your application.

Families First Coronavirus Response Act

This gives employees who come down with the Coronavirus two weeks (up to 80 hours) of paid sick leave at 100% of an individual’s salary, up to $511 per day.

It also offers up to 10 additional weeks of paid family and medical leave at 67% of the employee's normal pay, up to $200 a day. In this situation, you wouldn't be sick with the Coronavirus, but a family member would be. If you're losing work time taking care of them, you'll receive almost two-thirds of your pay.

Who’s Eligible

If you work for a company with < 500 employees.   

What if I’m self-employed?  If you get sick with the coronavirus and can’t work, you will receive a tax credit equal to your pay (up to $511 per day for up to 10 days). 

How to Apply

Talk to your employer and they will walk you through any steps you need to take.  You will be paid directly by your employer not the federal government.

The Act requires employers to cover the cost of their employee’ paid leave but the federal government will completely reimburse them via refundable tax credits within three months.

Unemployment Insurance

You might not have to lose your job to qualify. If you’re quarantined or have been furloughed — and you’re not being paid but expect to return to your job eventually — you may be able to get unemployment benefits.

States set their own rules for eligibility and benefits, which are generally calculated as a percentage of your income over the past year, up to a certain maximum.   Information on how to file in Missouri is available here.  You should file a claim in the state where you worked. 

Don’t forget to contact your bank if you are struggling financially.  A growing number of institutions are taking steps to offer assistance.

Student Loans

The Stimulus Package is expected to contain a provision to pause federal student loan payments interest free through September.

We are continuously monitoring the situation looking for ways to help you as much as we can.   If you have questions or need help applying for an SBA Disaster loan or other relief give us a call.   Stay in touch and let us know what you need. 😊