Important Updates to Payroll Protection Program, Tax Deadlines and Personal Financial Statements
On June 5, 2020, the
Paycheck Protection Program Flexibility Act (PPPFA)
was signed into law to address concerns of the small business community around the
Paycheck Protection Program
(PPP) and COVID-19 relief.
PPP Loans: More Flexibility on Terms and Forgiveness
- 75/25 ratio of payroll to other expenses (rent, utilities, etc.) has been modified to 60/40.
- The 8-week period to use PPP loans has been extended to 24 weeks.
- Portions of your PPP loan that are not forgiven can be converted to a regular loan payable over 5 years at 1% interest. Always check with your banker or SBA website.
- Schedule C taxpayers are also eligible for PPP loans--deadline to apply is June 30, 2020.
PPP Forgiveness
- Consider payroll software from Paychex or ADP to generate a forgiveness report.
- Fill out a “Forgiveness” application.
- Remember: If your PPP loan is forgiven you cannot deduct business expenses on your tax return.
- Consult with the banker who gave you the loan.
- Keep good documentation to support your Forgiveness application.
Tax Impact and Deferral
- You can defer 6.2% FICA tax to 2021 and 2022.
July 15, 2020 – Next Tax Deadline
- Individuals must file and pay 2019 taxes-- if missed, interest and penalties will apply.
- Quarterly estimated taxes for 2020 must also be paid.
Personal Fin'l Statements/Estate Plans
- Now is a good time to create a personal financial statement that identifies your Assets (what you own), your Liabilities (what you owe) and your Net Worth (assets minus liabilities)
- Hire an attorney to create an Estate Plan that outlines how you want your assets to be distributed upon your death with the least possible taxes.
Stock Market Volatility
- Stay the course – Consult our sponsored advisor Matt Tepoorten (Schwab) for more information:
Don’t wait until the last minute for assistance with these new programs or 2019 filing!
(203) 956-4899
|
(203) 291-9093
cecil@nazarethcpas.com
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Reminders for Tax Season 2019
Federal filing deadline extended to July 15, 2020.
- Check with your state authorities for state income tax filing deadlines.
- Don't wait until deadline if expecting a refund!
Security - Phone scams. NEVER
respond to phone calls or emails from the IRS. The IRS will only send you written communication by postal mail. Never email documents containing your Social Security numbers.
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Why You Want an Independent Review of Your Organization’s Financial Statements
Banks, lenders, acquirers and auditors look more favorably at your financials
if they’re independently reviewed or audited
and you’ll likely receive better rates and terms.
Contact us for assistance with your personal and business financial statements.
We offer three levels of service:
1)
Compilation.
Simple compilation of financial statements.
2)
Review
.
More analytical procedures performed.
3)
International Tax Planning.
(India-US specialty).
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