COVID-19 Why Hasn’t My Friend Gotten Their Stimulus Check?

On April 16, 2020 we published The Corona Virus Version of Where’s My Refund which highlighted Just Asking for A Friend.  Today we publish Why Hasn’t My Friend Gotten Their Stimulus Check?   In case your friend is wondering where the Economic Impact Payment is.

IYMI – Visit our archives.  #COVID-19 The Corona Virus Version Of Where’s My Refund

The IRS has sent out over 140M Economic Impact Payments (EIP) totaling about 239B$ and leaving about 10M payments yet to be delivered.

First, a few important things for all of us.

Remember, the Economic Impact Payment (stimulus check) is actually 2020 totally free money that most eligible people are getting now.  Because the IRS needed something to go on when this whole thing started, they used 2019 and 2018 returns as a mechanism to get payments to people.

Direct Deposit.  If you have an allocated direct deposit – the EIP will be deposited in the first account listed.  It will not be allocated.  If your tax return refunds for 2018 or 2019 were not direct deposited, the EIP will not be either. It will be mailed to the address on the last (2018/2019) tax return processed.

If a direct deposit account is closed, the bank will return the payment to the IRS, who will then mail a check or a prepaid debit card.  Find out more about that here:   EIP Card

EIPs will not be deposited into accounts that were used for Electronic Funds Withdrawal, Direct Pay, or EFTPS.  Direct Deposit info in Refund section ONLY.

The Letter.  If you have received your EIP, expect to receive snail mail in your curbside inbox within 15 days.  This letter will explain the EIP to you and offers up a phone number in case you have questions.  Yes; you read right!  A phone number.  If you follow us on Facebook, Twitter, Google+, or LinkedIn, you already know that the IRS has hired 3,500 phone operators.  After you suffer through the long and tedious automated message there will finally be a human at the end.

Worst case scenario.  Getting the EIP amount when the 2020 tax return is filed and processed.

If your friend hasn’t gotten their Economic Impact Payment yet.

Very first thing, tell your friend – Don’t assume that it is coming just because you know you always direct deposit IRS tax refunds or have always had Social Security and VA checks direct deposited.  Go to Get My Payment on the IRS website to be sure the direct deposit information is solid.

Next, give your friend a head’s up. The IRS is going to go to 2019 processed returns first. Keep in mind that an e-filed 2019 return is not a processed 2019 return. That Form 9325 acknowledgement means only that your tax return is in the IRS curbside mailbox and not in the building yet much less on anyone’s desk or laptop.  There may be a time delay as the IRS processes the 2019 return.  And another time delay if they have to pull out your friend’s 2018 processed return.

Did your friend use a tax prep service? And maybe got one of those debit or gift cards from the tax prep service.  If your friend used a tax prep service and got a “Refund Anticipation Loan” (RAL) that would slow down the EIP’s arrival as the payment will go to the tax prep service and perhaps even back to the IRS who will then mail a check.  The IRS does not have your friend’s direct deposit information.  This still may be fixable on Get My Payment.

Did your friend provide direct deposit information for 2018 and 2019 returns?  Adding the direct deposit information on Get My Payment may still help.  If not, your friend will get a check or prepaid debit card eventually.

Did your friend file a tax return for 2018 or 2019?  It’s possible your friend might not have filed because they didn’t have quite enough income.  This may still be fixable on the IRS Website: Non-filers: Enter Payment Info Here.  If not, your friend will get a check or prepaid debit card eventually.

Did your friend make too much money?  If you’re single, married, or head-of-household filer with a respective AGI between $75,000 and $99,000; $150,000 and $198,000; and between $112,500 and $136,500 the EIP will dwindle from the maximum of $1,200 to $0.

Did your friend paper file?  The IRS is not processing paper returns.  Your friend will get a check or prepaid debit card eventually.

Is your friend up to date on bank loans?  Unless your state expressly bans it – banks and collection agencies can hijack stimulus checks.

Does your friend have a social security number?  A valid social security number for work is required.  Do both spouses have social security numbers? In a married filing joint situation both spouses must have SSNs.

If your friend didn’t get the amount expected?

How old are your friend’s child(ren)? On the tax return the IRS is using, kids must be under 17 and eligible for the Child Tax Credit.  This is an additional payment of up to $500 per child.

If your friend’s dependents are parents or relatives.  Tell your friend no $500 for parents and no $500 for relatives older than 17.  Plus, the parents and the relatives over 17 don’t get their own up to $1,200 because they are a dependent on your friend’s return.

If there are any new additions in 2020. If your friend had, adopted, or fostered an eligible child in 2020 the additional $500 amount can be claimed on the 2020 return.

If your friend is a full-time college student.

It’s a tough predicament when college students are adults and parents claim them as dependents for various tax benefits.  No one gets the benefit of stimulus – now.  If your friend cannot be claimed and is not claimed as a dependent on the parents’ upcoming 2020 return your friend may get the $1,200 credit on the 2020 return.

Stay tuned next for what to do if you receive an EIP and shouldn’t’ve.

COVID-19 Disclaimer.  Laws and regulations have quickly changed and will continue to change in order to mitigate the economic damage caused by the Coronavirus Crisis.  New laws and regulations are being passed quicker than the legislative process has taken in the past. Guidance, clarifications, and interpretations are constantly evolving.  Deadlines and due dates are being extended and re-extended. New relief and programs are constantly rising up.  This is occurring on all levels:  Federal, State, and Local.  Information we publish may not be updated after initial publication/dissemination. We are committed to giving you the best answer possible based on what we know at the time your question is asked.

 

Posted in Accounting, Business, Covid-19, General Interest, Grants & Assistance, IRS, Payroll | Tagged , , , , | Leave a comment

#COVID-19 Still Some PPP Left

Word on the street is there remains $70 billion in SBA PPP funding. That first 349B$ April 3 was gone in a matter of several days. Near the end of April, it was replenished with 310B$. Plus, all the returns-the deadline to return PPP money without penalty was May 18.

We suggest try again – it wouldn’t hurt. Reach out to your lender and inquire or get on line and try.  Maybe you might open a new account at a community bank, or a credit union, or a community development bank.  Or even an alternative to all traditional lenders: #COVID-19 Finance + Technology = Fintech

And if we can be of any assistance – just reach out.

COVID-19 Disclaimer. Laws and regulations have quickly changed and will continue to change in order to mitigate the economic damage caused by the Coronavirus Crisis. New laws and regulations are being passed quicker than the legislative process has taken in the past. Guidance, clarifications, and interpretations are constantly evolving. Deadlines and due dates are being extended and re-extended. New relief and programs are constantly rising up. This is occurring on all levels: Federal, State, and Local. Information we publish may not be updated after initial publication/dissemination. We are committed to giving you the best answer possible based on what we know at the time your question is asked.

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#COVID-19 Watts Up Miles Down.

Kids schooling at home; grownups working from home. And nowhere really to go, Watts are up and Miles are down.Electric Bills.
The big utility companies are giving a little back on May bills. No disconnecting for nonpayment. No late payment or bounced payment fees. Fees are also being waived for credit and debit card payments. If you have already gotten your bill – you may have noticed it’s a little smaller.

Duke Customers: Residential – 21% in May; Business 20-45% in May.
FPL Customers: Residential – 25% May; Business –significant one-time decrease May.
Gulf Power Customers: Residential – 40% May; Business – 40-55% May.
TECO Customers: Residential – approx. $90 through December 2020; Business – 20% monthly June through August.
Each utility also has a donation mechanism to help others in our communities.

Vehicle Insurance.
$1,427 is the 2020 average annual car insurance premium. Personal auto travel has dropped more than 50% since March due to stay at home orders and the increase in remote workers. These insurers have announced COVID-19 credits and refunds:

Allstate, American Family Insurance (That’s The General!); Chubb Auto Insurance, Farmers Insurance (21st Century Insurance), Geico, Hanover Insurance Group, Liberty Mutual, Metlife, National General, Nationwide, Progressive Insurance, State Farm, The Hartford, Travelers, USAA.

Most are offering 15 or 20% on April and May premiums. If your insurer is not on this list, give them a call and demand some cash back. If you have already gotten your premium invoice – you may have noticed it’s a little smaller. If you have already paid your premium check for the credit on the next premium bill.

COVID-19 Disclaimer. Laws and regulations have quickly changed and will continue to change in order to mitigate the economic damage caused by the Coronavirus Crisis. New laws and regulations are being passed quicker than the legislative process has taken in the past. Guidance, clarifications, and interpretations are constantly evolving. Deadlines and due dates are being extended and re-extended. New relief and programs are constantly rising up. This is occurring on all levels: Federal, State, and Local. Information we publish may not be updated after initial publication/dissemination. We are committed to giving you the best answer possible based on what we know at the time your question is asked.

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#COVID-19 Pinellas Arts Community Relief Fund

The Pinellas Arts Community Fund is OPEN AGAIN !

This is a rolling application process with review, selection and disbursement happening bi-weekly.

The Pinellas Arts Community Relief Fund was started by a collaboration between Pinellas Community Foundation, St Petersburg Arts Alliance, and Creative Pinellas. Private donations are contributing to its continuance.

The cash awards are up to $500 for individuals and between $500 and $1,500 for arts businesses and organizations.

Who is eligible?

• Professional artists are those working in visual arts including, painting, sculpture, murals, photography, etc.; performing arts including theatre, music and dance etc.; literary arts; performance, multimedia, and social justice art; and who are making a significant portion of their income through production/performance/sale of their artwork.

• Arts organizations are 501(c)(3) organizations with the primary mission of providing arts and or cultural experiences to the public.

• Small creative businesses are retail businesses run by artists or in support of artists (such as galleries, art curators/installers, etc.) whose primary source of income is arts related, and whose primary business focus is business-to-consumer or direct/artistic services to artists or arts organizations.

These unrestricted cash awards are intended to support artists, arts organizations and creative businesses with (but not limited to):

Lost wages and earnings;
Loss from event, performance, and conference cancellations and school / community-based education closures; or from expected commissions, sales, or other opportunities due to the emergency situation/related economic downturn;
Medical expenses;
Bridge support to unemployment, food stamps; and,
Rent and mortgage payments, food, utilities, and other living expenses.
Find out More AND Apply Here https://pinellascf.org/grants/arts-relief

We strongly encourage small businesses and residents of other cities and towns to see if a similar program is available. Also, if you have applied to anything keep checking the websites – grants may become refunded and new grants may pop up.

We are here to guide you through this process and anything else to help you get through COVID-19. Email info@accpas.com. Please put COVID-19 in the subject line. Or call us at 727-327-1999.
In addition to the monthly newsletter and weekly blog we will be sending COVID-19 updates through “Email Updates”.
Follow McAtee & Associates on your preferred social media for additional COVID-19 updates. We are on Facebook, Twitter, LinkedIn, and Google+.

Stay safe. Stay strong.

COVID-19 DISCLAIMER: Laws and regulations have quickly changed and will continue to change in order to mitigate the economic damage caused by the Coronavirus Crisis. New laws and regulations are being passed quicker than the legislative process has taken in the past. And the interpretations are changing daily, if not hourly. Deadlines and due dates are being extended and re-extended. Information we publish may not be updated after initial publication/dissemination. Please keep this in mind as we get through this together.

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#COVID-19 City of Clearwater – Clearwater Back-to-Business Grant and Professional Services Program (Back To Business Program)

REGISTER TO APPLY AND PREQUALIFY BEFORE MIDNIGHT SUNDAY 5/17/2020

The Back To Business Program is a Clearwater, FL program that is providing up to $6,000 for qualifying brick and mortar businesses AND up to $3,000 for qualifying home-based businesses. There is presently $4 million dollars in the program.

On May 18, the City will randomly select applicants from the pool of prequalified applicants. Those selected will then submit a complete application – at this point – the funds become first-come, first-serve.

Eligible BRICK & MORTAR Applicants

a. $3,000 “quick pay” grant to be used for business expenses including, but not limited to commercial rent or mortgage and/or utilities, vendor payments, employee wages, other;
b. Access to and payment of certain Professional Services. Services will be procured by and through contractual relationship with non-profit organization(s). Services will be funded in an amount not to exceed $1,000 per qualifying applicant; AND,
c. 2,000 grant upon completion of Professional Services obligations.

Eligible HOME-BASED Applicants

a. Access to and payment of certain Professional Services. Services will be procured by and through contractual relationship with non-profit organization(s). Services will be funded in an amount not to exceed $1,000 per qualifying applicant; AND,
b. Grant equal to 1 month’s revenue, not to exceed $2,000, as evidence by appropriate financial records.

Find Out More AND Prequalify Here

https://www.myclearwater.com/government/city-departments/economic-development/covid-19-back-to-business-program-2591#utm_source=timesdigital&utm_medium=social&utm_campaign=2020

We strongly encourage small businesses and residents of other cities and towns to see if a similar program is available. Also, if you have applied to anything keep checking the websites – grants may become refunded and new grants may pop up.

We are here to guide you through this process and anything else to help you get through COVID-19. Email info@accpas.com. Please put COVID-19 in the subject line. Or call us at 727-327-1999.
In addition to the monthly newsletter and weekly blog we will be sending COVID-19 updates through “Email Updates”.
Follow McAtee & Associates on your preferred social media for additional COVID-19 updates. We are on Facebook, Twitter, LinkedIn, and Google+.

Stay safe. Stay strong.

COVID-19 DISCLAIMER:  Laws and regulations have quickly changed and will continue to change in order to mitigate the economic damage caused by the Coronavirus Crisis. New laws and regulations are being passed quicker than the legislative process has taken in the past. And the interpretations are changing daily, if not hourly. Deadlines and due dates are being extended and re-extended. Information we publish may not be updated after initial publication/dissemination. Please keep this in mind as we get through this together.

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#COVID-19 PPP Loan Forgiveness and Furloughed Employees Part 3 of 3

You want them back but you really shouldn’t call or text. Give the furloughed employee a written Offer of Recall that documents:

Return to work date.
Terms of employment – Position, Supervisor, Responsibilities/Job description, Salary/hourly rate, Hours, and whether Exempt/Non-exempt status.
Benefits status – Address seniority, benefits, accrued paid time off, and any other employer-provided benefit.
New safety procedures – Remote work should be undertaken when possible. Address the safe work environment-sanitation/disinfecting, social distancing, reduced customer capacity, staggered shifts, industry specific requirements, etc. We recommend referring to the State’s Phase in effect at time of recall offer.
Deadline to respond.
Reassurance – Warm and fuzzy words.
We recommend including a statement that refusal to return to work may result in the individual being ineligible for continued unemployment compensation.

Be sure to document the recalled employee’s acceptance or rejection of the recall offer: Date, time, method of communication, and reason for rejection. Save the email when sent to and received from the employee.

If both the employer and the furloughed employee had a reasonable expectation of the employee being recalled it may not be necessary to complete new hire paperwork such as W-4, I-9, drug testing consent, background checks, etc. Be sure to check with your human resources department and payroll provider.

Keep in mind that employees who return from furlough can become eligible (potentially immediately) for paid leaves under the Families First Coronavirus Response Act and other similar state statutes.

SBA PPP Loan Forgiveness.

Employers seeking loan forgiveness for payroll costs must recall/rehire furloughed employees no later than June 30, 2020 to receive unreduced loan forgiveness for layoffs occurring prior to April 26. BUT, furloughed employees may not come back for various reasons. Retired. Moved. Sick or caring for someone sick. Better employment elsewhere. Or, you may not want them back. And that’s okay.

When you apply for forgiveness from your lender, they will be looking at numbers not names, numbers not job titles. How many head count during the eight-week period? How many head count during your chosen covered period? You don’t necessarily have to bring the same person back. A full-time employee is the same head count as two-part time employees. A permanent hire is the same headcount as a temp to hire. A sales rep is the same headcount as a staff accountant.

Be on the lookout for our SBA PPP Loan Forgiveness – Emphasis on Payroll and the Math Of It. Part 2 of 3. Guidance from the Treasury Department and the SBA is expected possibly today or tomorrow (May 14 or 15, 2020). There will more than likely be Congressional changes as well in the recent House-introduced HEROES Act.

And if all else fails, the SBA has provided guidance that laid-off employees can be excluded from loan forgiveness reduction calculations if the employees turn down a written offer to be rehired. The offer AND the refusal must be documented, preferably in writing. These laid off employees should be aware that refusal of reemployment may result in ineligibility for continued state and pandemic unemployment compensation.

Also, loan forgiveness is not all or nothing. It is proportional with the unforgiven balance remaining a loan with repayment terms of two-years with a six-month deferral and 1% interest.

COVID-19 Disclaimer. Laws and regulations have quickly changed and will continue to change in order to mitigate the economic damage caused by the Coronavirus Crisis. New laws and regulations are being passed quicker than the legislative process has taken in the past. Guidance, clarifications, and interpretations are constantly evolving. Deadlines and due dates are being extended and re-extended. New relief and programs are constantly rising up. This is occurring on all levels: Federal, State, and Local. Information we publish may not be updated after initial publication/dissemination. We are committed to giving you the best answer possible based on what we know at the time your question is asked.

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#COVID-19 Employer Payroll Tax Deferral UPDTD Part 2 of 3.

“Section 2302 of the CARES Act provides that the payment and deposit of the employer’s share of the social security portion of FICA tax and the employer’s share of the social security portion of RRTA tax for deposits that are due to be made during the period beginning on March 27, 2020, and ending before January 1, 2021, is not due before December 31, 2021 (for the first 50 percent of the liability), and December 31, 2022 (for the remaining 50 percent of the liability).”

Blahblahblah! What this means. NONE of the matching 6.2% for Social Security/FICA and (RRTA) that employers would normally deposit/pay between March 27 and December 31, 2020 has to be deposited/paid in 2020. It does have to be deposited/paid eventually. Self-employed folks can defer 50% of their 12.4% social security tax ONLY, NOT 50% of “self-employment tax” which includes the 2.9% Medicare portion. And you don’t have to be impacted by COVID-19.

The 6.2% amount not paid becomes, in essence, an interest free loan with these repayment terms: 50% must be paid/deposited by December 31, 2021 and the remaining 50% paid/deposited by December 31, 2022. The employer still has to timely pay/deposit the matching Medicare 1.45% along with the Social Security, Medicare and federal income tax withheld from employees.

Eligible with SBA PPP – Yes. If you were one of the lucky ones to have gotten an SBA PPP loan – congratulations. You can also take advantage of the employer payroll tax deferral for additional cash flow maximization – until your lender tells you the PPP loan is forgiven. At that point, you will become ineligible for further employer payroll tax deferral. What’s already deferred, stays deferred with the same repayment terms. Keep in mind, that in the case of the PPP loan not being forgiven, it becomes a loan with these repayment terms: Due in 2-years with a 6-month payment deferral, 1% interest rate, no prepayment fees, no prepayment penalties.

Eligible with SBA EIDL – Yes.

Eligible with Paid Sick/Family Leave Credit/FFCRA credits – Yes.

Eligible with Employee Retention Credit – Yes.

We recommend each pay period that you record the unpaid/undeposited amount as a debit to expense and a credit to long-term liability. If a third-party agent, such as ourselves, or a PEO prepares your payroll and payroll reports and prepares or submits tax deposits on your behalf, IMMEDIATELY get a hold of them and let them know whether or not you want defer the employer payroll tax. Conversely, IMMEDIATELY get a hold of them should you wish to discontinue the employer payroll tax deferral.

If you need to cancel a previously scheduled EFTPS payment, call 800.555.4477. EFTPS can cancel and reschedule payments. All you have to do is suffer through high call volume and an unusually long wait time and then provide your name and Tax ID number, the exact amount of the payment, and the date of the payment.
We have noted no revision to the EFTPS website regarding the Employer Payroll Tax Deferral. Include ONLY the employees’ withheld 6.2% on the social security line.

The Form 941 for 2020, Employer’s QUARTERLY Federal Tax Return was revised April 29, 2020 to accommodate payroll tax relief provided by congressional legislation in response to COVID-19. Enter employee withheld 6.2% on line 13a and the deferred 6.2% on line 13b.

It will be important to maintain a system of periodic reconciliation of Form 941, line 13b totals to the balance sheet long-term liability account.

Part 1 of 3 – Employee Retention Payroll Credit. Part 3 of 3 – Recalling Furloughed Employees.

We are here to guide you through this process and anything else to help you get through COVID-19. Email info@accpas.com. Please put COVID-19 in the subject line. Or call us at 727-327-1999.
In addition to the monthly newsletter and weekly blog we will be sending COVID-19 updates through “Email Updates”.
Follow McAtee & Associates on your preferred social media for additional COVID-19 updates. We are on Facebook, Twitter, LinkedIn, and Google+.

Stay safe. Stay strong!

COVID-19 Disclaimer. Laws and regulations have quickly changed and will continue to change in order to mitigate the economic damage caused by the Coronavirus Crisis. New laws and regulations are being passed quicker than the legislative process has taken in the past. Guidance, clarifications, and interpretations are constantly evolving. Deadlines and due dates are being extended and re-extended. New relief and programs are constantly rising up. This is occurring on all levels: Federal, State, and Local. Information we publish may not be updated after initial publication/dissemination. We are committed to giving you the best answer possible based on what we know at the time your question is asked.

Posted in Business, Business Taxes, Covid-19, IRS, Payroll, Taxes | Tagged , , , , , | Leave a comment

#COVID-19 Employee Retention Tax Credit (ERTC) Part 1 of 3.

The ERTC is encouragement, for employers to keep paying employees, in the form of a refundable credit equal to 50% of up to $10,000 of qualified wages for a maximum $5,000 credit – per employee. The credit is taken against the employer’s share of social security (6.2%). Wages paid after March 12, 2020, and before Jan. 1, 2021, are eligible for the credit.

Eligible.

1. Government Order. Business is fully or partially suspended by government order due to COVID-19 during any 2020 calendar quarter (EVEN IF only one location/entity of more than one location/entity is suspended); OR,
2. Significant Decline in Gross Receipts. 50% less gross receipts than same quarter in 2019. AND eligibility lasts until the quarter AFTER the quarter gross receipts reach 80% of same quarter in 2019.

Not eligible.

1. SBA PPP loan recipients, household employers, and government employers.
2. If self-employed, your wages (self-employment income) is not eligible. Wages paid to your employees are eligible.

Can I take the ERTC if I have (or am taking) …?

SBA PPP Loan – No.
SBA EIDL – Yes.
Paid Sick/Family Leave Credit/FFCRA credits – Yes, BUT NOT for the same wages.
Employer Payroll Tax Deferral – Yes.
Work Opportunity Tax Credit – No.

What are qualified wages?

Qualified wages include both wages and each employer-paid group health care coverage plan including HDHPs, HRAs, and health FSAs. Employer paid health care coverage does NOT include amounts included in employee gross income, HSAs, Archer MSAs, or QSEHRA.

The amount of qualified wages depends upon:

Less than 100 average FTEs in 2019. Wages paid are qualified whether employees provided services or not.

More than 100 average FTEs in 2019. Wages paid are qualified ONLY if employees did NOT provide services. Amounts paid for previously accrued vacation or sick days or holidays are not qualified wages. Wages paid to employees who went from working at the workplace to working from home are NOT qualified wages. All health plan expenses paid on behalf of furloughed employees ARE qualified wages.

FTE – Any employee, who in any month in 2019 worked at least 30 hours a week.
Average FTEs – Add up all the FTEs in every month in 2019 and divide by 12.

How do I claim the Employee Retention Tax Credit?

For immediate cash flow, you can reduce employer tax deposits/payments $5,000 for every $10,000 qualified wages. Remember, you can only reduce the employer 6.2% portion of FICA/Social Security. We have noted no revision to the EFTPS website regarding the ERTC. Include ONLY the employees’ withheld 6.2% on the social security line.

The credit is then claimed and tallied up on the Form 941 for 2020, Employer’s QUARTERLY Federal Tax Return (quarters 2, 3, and 4) as revised April 2020. Of course, there is a little worksheet (Form 941, Worksheet 1) to be completed to figure out what is non-refundable and what is refundable. Remember, the credit can be applied against ONLY the employer 6.2% portion of FICA/Social Security.

If you have more ERTC than 6.2% FICA for the quarter, you can get the remaining ERTC by filing Form 7200, Advance Payment of Employer Credits Due To COVID-19, as revised March 2020.

We recommend each pay period that you record the unpaid/undeposited amount as a debit to expense and a credit to Other Income. If a third-party agent, such as ourselves, or a PEO prepares your payroll and payroll reports and prepares or submits tax deposits on your behalf, IMMEDIATELY get a hold of them and let them know whether or not you want to take advantage of the ERTC. Conversely, IMMEDIATELY get a hold of them should you wish to discontinue taking advantage of the ERTC.

If you need to cancel a previously scheduled EFTPS payment, call 800.555.4477. EFTPS can cancel and reschedule payments. All you have to do is suffer through high call volume and an unusually long wait time and then provide your name and Tax ID number, the exact amount of the payment, and the date of the payment.
It will be important to maintain a system of periodic reconciliation of Form 941 lines 11c and 13d totals to the Other Income account.

For further cash flow maximization, use the Employer Payroll Tax Deferral to defer, if any, the remaining amounts of employer portion 6.2% FICA/Social Security.

Part 2 of 3 – Employer Payroll Tax Deferral – Updated. Part 3 of 3 – Recalling Furloughed Employees.

We are here to guide you through this process and anything else to help you get through COVID-19. Email info@accpas.com. Please put COVID-19 in the subject line. Or call us at 727-327-1999.
In addition to the monthly newsletter and weekly blog we will be sending COVID-19 updates through “Email Updates”.
Follow McAtee & Associates on your preferred social media for additional COVID-19 updates. We are on Facebook, Twitter, LinkedIn, and Google+.

Stay safe. Stay strong!

COVID-19 Disclaimer. Laws and regulations have quickly changed and will continue to change in order to mitigate the economic damage caused by the Coronavirus Crisis. New laws and regulations are being passed quicker than the legislative process has taken in the past. Guidance, clarifications, and interpretations are constantly evolving. Deadlines and due dates are being extended and re-extended. New relief and programs are constantly rising up. This is occurring on all levels: Federal, State, and Local. Information we publish may not be updated after initial publication/dissemination. We are committed to giving you the best answer possible based on what we know at the time your question is asked.

Posted in Business, Business Taxes, Covid-19, General Interest, IRS, Payroll, Taxes | Tagged , , , , , , , | Leave a comment

#COVID-19 Employer Payroll Tax Deferral

“Section 2302 of the CARES Act provides that the payment and deposit of the employer’s share of the social security portion of FICA tax and the employer’s share of the social security portion of RRTA tax for deposits that are due to be made during the period beginning on March 27, 2020, and ending before January 1, 2021, is not due before December 31, 2021 (for the first 50 percent of the liability), and December 31, 2022 (for the remaining 50 percent of the liability).”

Blahblahblah! What this means. NONE of the matching 6.2% for Social Security/FICA and (RRTA) that employers would normally deposit/pay between March 27 and December 31, 2020 has to be deposited/paid in 2020. It does have to be deposited/paid eventually. Self-employed folks can defer 50% of their 12.4% social security tax ONLY, NOT 50% of “self-employment tax” which includes the 2.9% Medicare portion.

The 6.2% amount not paid becomes, in essence, an interest free loan with these repayment terms: 50% must be paid/deposited by December 31, 2021 and the remaining 50% paid/deposited by December 31, 2022. The employer still has to timely pay/deposit the matching Medicare 1.45% along with the Social Security, Medicare and federal income tax withheld from employees.

If you were one of the lucky ones to have gotten an SBA PPP loan – congratulations. You can also take advantage of the employer payroll tax deferral for additional cash flow maximization – until your lender tells you the PPP loan is forgiven. At that point, you will become ineligible for further employer payroll tax deferral. What’s already deferred, stays deferred with the same repayment terms. Keep in mind, that in the case of the PPP loan not being forgiven, it becomes a loan with these repayment terms: Due in 2-years with a 6-month payment deferral, 1% interest rate, no prepayment fees, no prepayment penalties.

We recommend each pay period that you record the unpaid/undeposited amount as a debit to expense and a credit to long-term liability. If a third-party agent, such as ourselves, or a PEO prepares your payroll and payroll reports and prepares or submits tax deposits on your behalf, IMMEDIATELY get a hold of them and let them know whether or not you want defer the employer payroll tax. Conversely, IMMEDIATELY get a hold of them should you wish to discontinue the employer payroll tax deferral.

We have noted no revision to the EFTPS website regarding the Employer Payroll Tax Deferral. Include ONLY the employees’ withheld 6.2% on the social security line.

The Form 941 for 2020, Employer’s QUARTERLY Federal Tax Return was revised April 29, 2020 to accommodate payroll tax relief provided by congressional legislation in response to COVID-19. Enter employee withheld 6.2% on line 13a and the deferred 6.2% on line 13b.

It will be important to maintain a system of periodic reconciliation of the line 13b totals to the balance sheet long-term liability account.

If you need to cancel a previously scheduled EFTPS payment, call 800.555.4477. EFTPS can cancel and reschedule payments. All you have to do is suffer through high call volume and an unusually long wait time and then provide your name and Tax ID number, the exact amount of the payment, and the date of the payment.

Stay safe. Stay strong!

COVID-19 Disclaimer. Laws and regulations have quickly changed and will continue to change in order to mitigate the economic damage caused by the Coronavirus Crisis. New laws and regulations are being passed quicker than the legislative process has taken in the past. Guidance, clarifications, and interpretations are constantly evolving. Deadlines and due dates are being extended and re-extended. New relief and programs are constantly rising up. This is occurring on all levels: Federal, State, and Local. Information we publish may not be updated after initial publication/dissemination. We are committed to giving you the best answer possible based on what we know at the time your question is asked.

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#COVID-19 City of Gulfport – Gateway Grant-BUSINESS

City of Gulfport – Gateway Grant

OPENS WEDNESDAY May 6, 2020
FIRST-COME, FIRST-SERVE

Stroll down any Main Street, USA. Stores with closed signs. Empty storefront parking spaces. Idle exercise equipment. Uncoiffed dogs out walking. Styrofoam to go containers have taken the place of plates. Beach Boulevard and elsewhere across Gulfport is no different.

The Gulfport Gateway Grant Program is a Gulfport, FL program that is providing 40 $1,000 utility bill credits and 20 $500 utility bill credits to local businesses. This $50,000 comes from the unrestricted General Fund Balance.

Eligible BUSINESS Applicants

• Must be physically located within the municipal boundaries of the City of Gulfport
• Must be independently operated
• Must be a brick and mortar location
• Employ between 3-50 full-time equivalent employees (February 2020) Eligible for a $1,000 Credit OR
• Employ between 1-2 full-time equivalent employees (February 2020) Eligible for a $500 Credit
• Suffered a loss of revenue due to COVID-19
• Must have a current City of Gulfport business tax license
• In operation during February 2020 and had employees for whom it paid salaries and payroll taxes
• Must have NO outstanding code enforcements or utility liens in the City of Gulfport.
• Can NOT be a nonprofit.

We interpret from the city’s published application guidance that a business owner is limited to applying for one business ONLY.

APPLY HERE

Submitting Your Application.

By email: Cparker@mygulfport.us OR
By mail: City of Gulfport, ATTN: Gulfport Gateway Grant, 2401 53d St S, Gulfport, FL 33707-5161

We strongly encourage small businesses and residents of other cities and towns to see if a similar program is available.

We are here to guide you through this process and anything else to help you get through COVID-19. Email info@accpas.com. Please put COVID-19 in the subject line. Or call us at 727-327-1999.
In addition to the monthly newsletter and weekly blog we will be sending COVID-19 updates through “Email Updates”.
Follow McAtee & Associates on your preferred social media for additional COVID-19 updates. We are on Facebook, Twitter, LinkedIn, and Google+.

Stay safe. Stay strong.

COVID-19 DISCLAIMER: Laws and regulations have quickly changed and will continue to change in order to mitigate the economic damage caused by the Coronavirus Crisis. New laws and regulations are being passed quicker than the legislative process has taken in the past. And the interpretations are changing daily, if not hourly. Deadlines and due dates are being extended and re-extended. Information we publish may not be updated after initial publication/dissemination. Please keep this in mind as we get through this together.

Posted in Business, Business Taxes, Covid-19, General Interest, Taxes | Tagged , , , , | Leave a comment