The information below includes releases issued by BenderCPA during the COVID-19 pandemic. These posts include summaries of tax law changes and relief provisions granted by the IRS and state/local authorities that impact our clients. While we try to be as detailed as possible, we ask that clients contact their BenderCPA advisor with any questions before taking action based on a post to ensure your intended outcome is achieved.
ALERT- CARES Act Part 1 – Business & Payroll Updates
To Our Valued Clients:
In our continuing effort to keep you informed of developments, we provide the following updates. This is Part 1 of a two-part update that focuses on business and payroll relief, including relief granted from the CARES Act signed into law on Friday, March 27th.
1. CARES Act- Small Business Loans via SBA 7(a). SBA 7(a) loans to qualifying businesses [no personal guarantee and loan forgiveness based on continuing payroll requirements]. Over the weekend, BenderCPAs contacted several SBA affiliated banks in the St Louis area requesting the loan applications & instructions to assist our clients. The contacted bankers told us the SBA has NOT provided them with the applications & instructions yet, and they are ‘unofficially’ being told by the SBA it will most likely be the end of the coming week before the applications are distributed to the banks. The following link https://www.venable.com/insights/publications/2020/03/the-cares-act-what-you-need-to-know-about provides an informative summary of ‘Borrower FAQs’ for the new round of SBA loans that you may find helpful.
Our guidance to our business clients is to be patient (we know that is difficult at this time), and we’ll provide further updates as the SBA 7(a) loan application information becomes available.
Based on information in the above FAQs url link, taxpayer’s that have applied for SBA 7(b) Economic Injury Disaster Loans (EIDL) should discuss potential modifications to your loan application with the SBA by contacting the SBA’s Customer Service Center at 800-659-2955 or email email@example.com to see if the application should be converted to a SBA 7(a) loan and the impact of such change.
Families First Coronavirus Response Act (FFCRA)-
Paid Sick and Family Leave Payroll Tax Credits Update. As an update to our ALERT email of 3/24/2020,
the IRS issued Technical Guidance Notice 2020-21 on Fri 3/27/2020 (at 5:17 pm) establishing
4/1/2020 as the effective date for wages paid under the Act that will
be eligible for the employment tax credits. Businesses that submitted FFCRA related
payroll hours for the period 3/18 – 3/31 will NOT qualify for the credit.
The Dept of Labor (DOL) has issued a poster (link: https://www.dol.gov/sites/dolgov/files/WHD/posters/FFCRA_Poster_WH1422_Non-Federal.pdf) with an overview of qualifications for sick and family leave and related credits. Qualified leave pursuant to the FFCRA includes employees unable to work or telework, subject to a Federal, State, or local quarantine or isolation order related to COVID-19. While DOL or IRS have not issued guidance on this point, we have encountered legal commentary that a ‘stay at home’ order MAY qualify as an ‘isolation order’. We continue to recommend you speak with your legal counsel to evaluate your specific facts and circumstances if you’re unclear how your employees’ situation is applied under the FFCRA.
3. MO Shared-Work Program. Missouri Division of Employment Security (MODES) and Missouri Department of Labor have announced the ability for employees to access partial unemployment benefits if workforce hours are reduced by 20 – 40%. See the following link for more information: https://labor.mo.gov/shared-work.
4. MODES Unemployment Benefits Q & A. MODES also announced a Q&A page (link: https://labor.mo.gov/coronavirus) for employees impacted by the coronavirus. The Q&A includes guidance that:
a. Coronavirus effected claims will have the waiting week requirement waived
b. Coronavirus unemployment claims will temporarily NOT be charged to the employer’s account
At this point in time, the CARES Act is only a few days old and additional guidance and clarification is expected in the upcoming weeks. Once that information is available, we’ll provide further updates. You can also follow all COVID-19 updates on our website at www.BenderCPA.com/COVID-19.