The CARES Act signed into law late last week has several provisions aimed at helping the economy during these trying times. Several of which clients will need to take some action to take advantage of. We here at Nicholson, Michaud & Company want to make sure you have the information you and your business need and have provided some information and resources below. Please keep in mind that this is all new and guidance and procedures are still in process.
Paycheck Protection Program – This is a loan program through the SBA with fully guaranteed loans to businesses. These loans are forgiven if the business maintains its payroll through the crisis. If you have not already done so, we recommend you contact your lender immediately.
- Individual recovery rebate/credit – Advanced 2020 credit up to $1,200 individual or $2,400 married filing joint. Plus $500 per qualifying child.
- No 10% additional tax for coronavirus-related retirement plan distributions.
- RMD requirement waived for 2020.
- $300 above-the-line charitable deduction.
- Modifications of limitations on individual and business cash charitable contributions in 2020.
- Tax-excluded education payments by employer temporarily include student loan repayments.
- Employee retention credit for employers, provides a refundable payroll tax credit of 50% of wages up to $10,000 paid to certain employees (cannot be taken if business gets a loan through the PPP program above). Please contact your payroll provider.
- Delay of payment of employer payroll taxes. Allows taxpayers to defer paying the employer portion of certain payroll taxes through the end of 2020. Please contact your payroll provider.
- Modification of rules relating to net operating losses.
- Modification of limitation on losses for noncorporate taxpayers.
- Bonus depreciation technical correction for qualified improvement property.