CARES Act Update
The CARES Act was signed by the President on March 27, 2020.
This legislation provides broad relief to the country in response to the COVID-19 pandemic and includes numerous individual and business relief provisions.
More information on the key provisions of the Act are here:
Individual Relief
Economic Impact Payments
IRS News Release regarding economic impact payments.
This release explains eligibility and income requirements, as well as the phase out ranges and provisions for dependents.
The income amounts in the Act refer to Adjusted Gross Income.
Your adjusted gross income can be found on your 2019 Form 1040, Line 8b, or your 2018 Form 1040, Line 7.
An online rebate calculator can be found here.
If you are not required to file a tax return, but qualify for an Economic Impact Payment, you can notify the IRS that you are eligible here.
No 10% penalty for coronavirus-related retirement plan distributions and RMD waiver
$300 above-the-line charitable deduction to incentivize charitable giving
Business Relief
Employee retention credit for employers
Delay of payment of employer payroll taxes
Forgivable Business Continuity Loans
This post will be updated as more information becomes available.
Treasury Secretary Mnuchin Extends Federal Income Tax Filing Deadline – Ohio Also Extended
At the urging of the President and the professional community, Treasury Secretary Mnuchin has announced via Twitter that the 2019 federal tax filing deadline will be moved to July 15, 2020 to align with the recently announced revised payment deadline. WSJ article and announcement link can be read here. Official notice is posted here.
The IRS posted a series of FAQ’s regarding this measure here. The FAQ’s address the affect of this provision on IRA contributions, tax payments due under installment agreements, exactly which form types it applies to, and estimated taxes among other items.
On March 27, 2020, Ohio Tax Commissioner Jeff McClain announced the extension of time to file and pay Ohio income tax, Ohio school district tax, and Ohio pass-through entity tax until July 15, 2020 to conform to the federal due dates. The announcement can be read here.
Most Ohio cities base their due dates on the Ohio deadline, therefore most Ohio cities are automatically extending their due dates as well.
To check due dates for states other than Ohio, the AICPA has provided a state-by-state relief guide here.
Stay At Home Order Update
The Director of the Ohio Dept. of Health has issued a Stay At Home Order effective 11:59 pm on Monday March 23, 2020, closing non-essential businesses through April 6, 2020. The Order can be read here.
Essential businesses and work-from-home businesses are allowed to remain open and operating. Essential businesses are defined in Section 12 beginning on page 5 of the Order.
The Order was amended on April 2, 2020 to extend through 11:59 pm on May 1, 2020.
Anderson Tax & Consulting will continue to operate while the Order is in effect.
Tax Credits for Employers in Relief Bill
The Families First Coronavirus Response Act, signed Wednesday night, includes many tax credit provisions for employers to help them deal with recent events.
Credits include:
- Payroll tax credit for required paid family leave
- Payroll tax credit for required paid sick leave
Each of these credits have provisions for self-employed individuals in addition to employers.
The initial release from the U.S. Treasury, DOL and IRS can be read here, and includes examples of the calculations.
Further guidance will be released next week.
The IRS urges businesses and taxpayers to use their Coronavirus Tax Relief page to keep updated on federal tax relief related announcements.
Precautions to Protect Clients and Staff
We are all experiencing an unprecedented crisis.
In an effort to minimize the spread of the Coronavirus among clients, our team and all of our families, Anderson Tax & Consulting will suspend face-to-face meetings effective March 20, 2020.
We will, of course, replace face-to-face meetings with phone calls or other means of discussing the matters important to you.
While the office will be staffed, we respectfully request that documents be supplied either by mail or electronically if possible to avoid additional risk.
We also encourage clients to receive documents by mail or electronically while the current circumstances exist.
The U.S. Treasury’s recent extension of the payment deadline provides additional time for this year’s tax return preparation, making this precaution easier on all of us.
These precautions will be reevaluated weekly and updates posted accordingly.
We wish everyone and their families good health and look forward to business-as-usual after the crisis passes.
IRS Extends 2019 Tax Payment Deadline in Response To Pandemic
The tax payment deadline for 2019 income tax has been extended from April 15, 2020 to July 15, 2020 in response to the recent outbreak.
Individual taxpayers, estates and trusts owing less than $1 million in tax can pay by the July 15, 2020 deadline without penalty or interest.
Corporate taxpayers owing less than $10 million in tax can pay by the same date without penalty or interest.
This relief also includes 2020 estimated taxes due on April 15, 2020 (first quarter 2020 estimates).
Taxpayers do not need to contact the IRS or complete additional forms for this relief, it is automatic.
Extensions still must be filed by April 15, 2020.
The press release from the Treasury Department can be read here.
State and local governments may have different due date requirements.
The AICPA has provided a state-by-state relief guide here.
Anderson Tax & Consulting will continue to work towards the April 15, 2020 deadline and will continue to post relevant information as it becomes available.
If we have already prepared your 2019 tax returns but haven’t filed them yet, and you want to take advantage of the additional time allowance, please contact us at your earliest convenience so that we can file an extension on your behalf.
