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kjtax

COVID-19 Stimulus Update


Details subject to change.



Individuals

2019 Tax Deadline

  • 15 July 2020

Stimulus Payments

  • $1,200 for single, $2,400 for married (for certain income levels)

  • Based off of 2019 tax return. If not yet filed based on 2018 return

Retirement Distributions

  • No Required Minimum Distributions (RMDs) for 2020

  • No penalty on early distributions

  • Distributions can be paid back in three years and will be considered a 60-day rollover

Charitable Contributions

  • Up to $300 can be deducted on top of the standard deduction for 2020 (without itemizing)

Social Security Recipients

  • Eligible to receive stimulus without filing tax return




Employees

Paid Sick Leave

  • $200 per day for caregivers up to 12 weeks

  • $511 for sick employee up to 10 days

Layoff/Furlough

  • Individuals with no work or telework option (state unemployment + $600 per week)



Self-Employed

Unemployment Benefits

  • Extended to self-employed

  • Amount = state benefit + $600 per week

Estimated Tax Payments

  • 1st quarter estimated payments due July 15

  • 2nd quarter estimated payments due July 15


Self-Employed & Small Businesses

Payroll

Paid Sick Leave

  • Reimbursed via payroll tax credits

Delayed Payroll Tax

Retention Credit

  • 50% of wages up to $10k quarter after Mar 12

  • Reimbursed via payroll tax credits

  • Ineligible with PPP loan

Layoff/Furlough

  • Employees become eligible for unemployment

Grant/Loans

Economic Injury Disaster Loan (EIDL)

  • Used for operating expenses

  • Grant of $10k received within days

  • Loan amounts paid at 3% over 30 years

  • No loan forgiveness

  • Apply on SBA website

Paycheck Protection Program (PPP)

  • Used for payroll, rent, and utility expenses for 8 weeks up to $10mil

  • Loan amount up to 2.5 times average monthly payroll

  • Loan amount paid at ~1% over 2-10 years

  • Could be forgiven if 75% of the loan is used for payroll expenses (can rehire staff)

  • Penalty if staff is reduced by 25%

  • Ineligible if using payroll retention credit or EIDL

  • Apply with SBA approved lenders


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