SBA Loan Application Assistance

President Trump approved the “Coronavirus Assistance Act.  Some of the provisions are intentionally designed to boost US economy by helping small businesses overcome financial hardships brought on by the virus.  Many of the measures are aimed to allow businesses time to recover by giving them financial incentives to make up for lost revenues.  Most of our own firm's clients have been adversely affected by Corona virus, which makes the passing of the CARES ACT a bit of good news and hope.  (This article has been prepared by Milla Liberson - President of OnPoint Business Solutions, Inc.  An independently owned and operated tax firm based out of New York, NY.  This article will be updated as more information becomes available)

ECONOMIC AID HIGHLIGHTS  FOR SMALL BUSINESSES & INDIVIDUALS

• Delay Payment of Payroll  Taxes -Employers can postpone employer social security taxes from March 27th, 2020 through December 31, 2020, with 50% due January 1, 2021 and 50% due January 1, 2022. Keep in mind that employers receiving Paycheck Protection Program loans are not eligible for the deferment.
• Unemployment Benefits Expansion - Eligible employees will get an additional $600 per week through July 31, 2020 and 13 more weeks of benefits. Unemployment benefits will be available to sole proprietors and freelancers.
• Employee Retention Credit- Some businesses will be able to receive a credit for wages paid for employees retained during the corona virus epidemic.  Those taking advantage of the credit  cannot participate in the Loan Forgiveness Program, described below.  The employee retention credit  is fully refundable 50% credit applied to a company's share of payroll taxes on wages exceeding $10,000 per employee. 
• Loans for Payroll Protection - Eligible businesses with less than 500 employees will be qualified for funding to cover payroll and operating expenses.
• Partial Loan Forgiveness - Principle amounts on Paycheck Protection Program loans may be forgiven. Discuss details with your accountant or tax adviser. 
• Garnishments for student loans has been suspended through Sept 30, 2020.
• Cash  payments from the IRS for tax payers coming from the government based on 2018 or 2019 taxable income.  Eligible individuals will get  $1,200 per person and those with kids will received an additional $500 per child.
• Health Spending Account Expansion - Provisions will allow over the counter medicines and tele-health consultations and screening be paid from HSA accounts.  CARES ACT eliminates prescription requirement as imposed by the ACA. 
• SBA Loan Expansion - Small businesses with under 500 employees will be eligible for low interest and flexible payment option loans from the SBA.  Businesses will be able to borrow up to 250% of their average monthly payroll costs based on a 12 month look back period.  These loans will have no application fees and the interest cannot exceed 4%.  These loans will have a maximum term of 10 years with the first 6 months of payments deferred for up to 1 year. 
• Bonus Depreciation For Real Estate - Qualified improvement property will be eligible for accelerated depreciation deduction. This will allow real estate businesses retain more cash for operations and investments