The CARES Act contains a lot of provisions designed to stabilize the economy and help individuals and business with immediate cash needs.
This is an overview. We will be communicating details as we receive them.
- Tax credit advances paid by the Treasury.
- Individuals will receive $1200 ($2400 for joint filers) plus $500 per child.
- The credit is phased out for incomes above $150k for joint filers and $75k for single filers.
- The Treasury department will try to send payments within three weeks.
- This is a 2020 tax credit that will be reconciled on your 2020 income tax returns.
Payroll Tax Credit Refunds
- The credit is for required paid sick leave and family leave.
Employee Retention Credit
- A credit for employers that close due to the coronavirus.
- A credit against payroll taxes equal to 50% of wages, up to $10k per employee
- For employers whose businesses are suspended due to orders from a governmental authority, and employers whose gross receipts are 50% less than the same quarter in the prior year.
- Eligible wages are those paid to employees who are not providing services due to the suspension of the business.
Payroll Tax Delay
- 50% of employer payroll taxes for 2020 are delayed until 2021 and 50% are delayed until 2022.
- This does NOT include taxes withheld from employee wages.
- Distributions up to $100k are allowed without the 10% penalty
- Must be diagnosed with COVID-19 or have a spouse or dependent who has been diagnosed or suffering financial difficulties from being laid off or unable to work due to lack of childcare.
- Distributions may be repaid within 3 years.
SBA Disaster Loans
- Directly from SBA
- Apply at disasterloan.sba.gov/ela
- Used to pay payroll, fixed debts, and other bills that can’t be paid due to loss of revenue from a disaster.
SBA Forgivable Loans
- Administered by banks
- Contact your bank to see if they are participating
- For money spent on payroll, mortgages, rents, or utilities
- Up to 4 times the businesses’ average cost of above expenses.
- Up to $100k