There are many ways a business, an individual, and even a buyer can benefit from the CARES Act, FFCRA, State legislation, local grants, and a general abundance of financial relief permeating the economy. To simplify your search, we have compiled a comprehensive list of programs or activities that might be a benefit to your business or your employees. While many of these programs, owing to popularity in the press, are well understood by our readers already, there are other less-advertised benefits that we think are powerful. We hope you will find at least one new piece of information that will benefit your business or an individual that you know.
We’ve done our best to provide up to date information, but things have been changing quickly. We encourage you to scan the headlines for relevant topics, and click the hyperlinks to their sources. Be sure to perform your own further research and discuss with your legal, tax, investment, et al professionals.
SBA Programs: The PPP and EIDL have been all over the press. Have you heard about the six months of debt relief for existing and NEW SBA loans?
- SBA Debt Relief: The SBA is providing a financial reprieve to small businesses by covering six months of principal and interest payments to your lender. This is not a forbearance…these are green dollars; $17billion appropriated to the SBA to make your payments to your bank for six months. This applies to existing loans and even NEW loans acquired before September 27, 2020! LEARN MORE
- Paycheck Protection Program (PPP) loan program provides loan forgiveness for retaining employees by temporarily expanding the traditional SBA 7(a) loan program. This is a forgivable loan that congress states shall be forgiven IF you follow the terms of the loan. It does appear that you can apply for both the EIDL grant AND PPP; however, you’ll want to review program terms once you’re offered a loan. LEARN MORE
- EIDL Loan Advance will provide up to $10,000 of economic relief to businesses that are currently experiencing temporary difficulties. LEARN MORE
- SBA Express Bridge Loans enables small businesses who currently have a business relationship with an SBA Express Lender to access up to $25,000 quickly. LEARN MORE
Commercial Loan Forbearance: Just like with individual mortgages, most commercial lenders are making it easy to qualify for forbearance. Make the call; it may be easier than you think. There are even cases of borrowers being called by their lender, voluntarily, to ask if the borrower would like to apply for forbearance. Every lender will be different, so contact yours for details. You might get relief on principal and interest or principal only.
Paid Leave – Employee Benefit and Employer Tax Credit: The Family First Coronavirus Response Act (FFCRA) reimburses American private employers that have fewer than 500 employees with tax credits for the cost of providing employees with paid leave taken for specified reasons related to COVID-19. The law enables employers to keep their workers on their payrolls, while at the same time ensuring that workers are not forced to choose between their paychecks and the public health measures needed to combat the virus. LEARN MORE
Student Loan Tax Benefit for Employers: Employers can now pay up to $5,250 toward an employee’s student loans tax-free through the end of the year. Traditionally, these payments are treated as wages, but until December 31, 2020, these payments are excluded from income and payroll taxes – benefiting both the employer and those receiving the repayment assistance. LEARN MORE
Depreciation of Qualified Improvement Property: This is most applicable to big commercial real estate investors. The 2017 Tax Cuts and Jobs Act (TCJA) contained a technical error that resulted in a 39-year depreciation period for the costs of qualified improvement property, rather than allowing for immediate depreciation. The CARES Act corrects this, which will be of particular benefit to retail establishments, restaurants and hotels. Now, qualified improvement property is eligible for immediate depreciation. In addition to applying to the current 2020 tax year, the correction also is retroactive and applies to the past two years (2019 and 2018). Taxpayers will need to file amended returns to take advantage of the correction. LEARN MORE
Free business help! The stimulus bill has allocated money through grants to Small Business Development Centers. If you’re starting a business or need business advice, your local development programs are basically free money in the form of services. The Florida Small Business Development Center at the University of West Florida (Florida SBDC at UWF) provides management assistance and training to any prospective or existing small-business owner in Northwest Florida, including Escambia, Santa Rosa, Okaloosa, Walton, Bay, Holmes, Washington, Gulf, Calhoun, and Jackson counties. LEARN MORE
County or City Small Business Grants: There are numerous local entities and non-profits that are offering small business grants. Stay stitched into social and professional networks to learn about new ones.
- The SBDC at UWF had a grant program that closed on April 14. However, a new one is being offered by the City of Pensacola and Escambia County starting Monday, April 20: $2500 Small Business Recover Grant for Escambia County
- U.S. Chamber of Commerce Foundation is initiating the Save Small Business Fund, which is a collective effort to provide $5,000 grants to as many small employers as possible. The application process begins Monday, April 20. LEARN MORE
Individual Stimulus Checks: Most of us already know about the stimulus checks, and the money has started hitting bank accounts. In case you still need to study up on it, there is an abundance of calculators and FAQs online. LEARN MORE
Unemployment Benefits: Florida Gov. Ron DeSantis has waived the mandatory delay that prevented applicants from receiving benefits during the first week of their unemployment. In addition, DeSantis dropped the requirements to contact at least five potential employers per week and complete work registration on the Employ Florida website.
The state determines your weekly benefit payments based on your previous earnings during employment. In 2020 in the state of Florida, you can receive a maximum of $275 per week for 12 weeks. You are entitled to a maximum benefit amount of $3,300.
The federal government’s COVID-19 relief package, known as the CARES Act, provides eligible unemployed individuals $600 per week for four months. Those who qualify will receive this benefit in addition to their weekly Florida unemployment benefit. The federal unemployment benefit payments are scheduled to end July 31, 2020. LEARN MORE
New Deductions & Savings through Health Savings Account (HSA): HSA funds can now be used for a) telehealth PRIOR to meeting your deductible; b) over-the-counter drugs and medicines WITHOUT a prescription and c) menstrual care products. LEARN MORE
Mortgage Forbearance: Most lenders are making it easy to qualify for forbearance. Some are not even asking for verification of hardship. They assume, if you are calling, that you are in need, and the systems (and hard-worked customer service agents) are overwhelmed, resulting in rapid acceptance. Every lender will be different, so contact yours for details. Some lenders even have easy online applications. You will have to pay your escrow balance (taxes & insurance) either during the forbearance period or at the end. This is normal, as these obligations will still have to be met and outside the control of the bank. LEARN MORE
Rent Relief: If you are a tenant, come up with a plan, ask for relief, document everything with your landlord. The more you communicate with your landlord, the better chance you’ll have. Be upfront; be transparent. LEARN MORE
Student Loan Payments: Interest is being temporarily set at 0% on federal student loans, and your payments will automatically stop from March 13, 2020, through Sept. 30, 2020. LEARN MORE
New Terms for 401k and certain other retirement accounts: The new 401k terms provide a much more flexible way to emergency funding penalty and tax-free for three years with extended payback terms.
- Required Minimum Distributions (RMDs) for 2020 are suspended for certain defined contribution plans and IRAs, including 401(k), 403(b) and governmental 457(b) plans as well as SEP IRAs, SIMPLE IRAs and traditional IRAs.
- Affected, eligible participants in workplace retirement plans and IRA owners can take an aggregate distribution in 2020 of up to $100,000 from all retirement accounts without incurring the usual 10% early withdrawal penalty.
- In addition, the income tax on the distributions may be spread evenly over three years. Or, the distribution may be repaid to an eligible retirement plan within three years. LEARN MORE
Charitable Contributions Tax Deduction:
- Itemized deductions: There is now no limit to the deductions you can take for charitable contributions if you itemize your contributions. Previously, you could only deduct up to a maximum of 60% of your adjusted gross income (AGI) via charitable contributions, but under the new guidelines, 100% of your donation would now be tax-deductible.
- Standard Deductions: Under the CARES Act, taxpayers can now take a deduction for up to $300 in charitable contributions, if they do not itemize on their 2020 tax form. This is a flip from the previous rule that required itemization for a tax break. LEARN MORE