Florida storm victims eligible for tax relief can take advantage of extended deadlines until August 15 instead of the original April 18 deadline.
Florida Storm victims now have until August 15, 2023, to file…
Congress made the big move with the largest stimulus package in U.S. history, a $2 trillion bill intended to rescue the coronavirus-battered economy. A plan that will provide loans, new tax deadlines, and direct payments to large corporations, small businesses, and social individuals whose revenue and income have plummeted under ‘social distancing’ restrictions meant to slow the spread of the virus.
SBA Disaster Assistance in Response to the Coronavirus
Federal disaster loans
As part of the recovery package recently signed by President Trump, the U.S. Small Business Administration (SBA) is offering designated states and territories1 low-interest federal disaster loans for working capital to small businesses suffering substantial economic injury as a result of the Coronavirus (COVID-19). Upon a request received from a state’s or territory’s Governor, SBA will issue under its own authority, as provided by the Coronavirus Preparedness and Response Supplemental Appropriations Act that was recently signed by the President, and Economic Injury Disaster Loan declaration.
SBA’s Economic Injury Disaster Loans offer up to $2 million in assistance and can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.
These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. The interest rate is 3.75% for small businesses. The interest rate for non-profits is 2.75%.
SBA offers loans with long-term repayments in order to keep payments affordable, up to a maximum of 30 years. Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay.
Application for these loans can be done directly through SBA website and requires the completion of several forms and the submission of a number of documents supporting asseverations in those forms.
We are ready to assist in the completion of all these forms and preparing all necessary additional documentation and even act as your agents to follow up through all the processes with SBA for this loan application.
Paycheck Protection Program
This emergency loan program offered by the Small Business Administration (SBA) is a government-backed loan for businesses that have been affected by the coronavirus outbreak, is designed to help small businesses retain employees during the coronavirus outbreak. Rates max out at just 4% — much lower than a traditional business loan.
The maximum loan amount is $10 million based on payroll expenses for 7(a) loans, $1 million for Express2 loans; SBA guarantees 100% of the loan amount and guarantee and annual fees are waived.
The term is 10 years, with payments deferred for 6 months to a year after the loan is issued, with no collateral or personal guarantee, and is approved faster than a 7(a) loan, as lenders don’t have to wait for SBA approval.
The established procedure for application and administration of these loans is as follows:
1. Business owners apply with an SBA lender for a loan to cover operating costs3 between February 15, 2020 and June 30, 2020.
2. The lender defers payments for six months to one year after the loan is issued.
3. The borrower applies to have loan forgiven after June 30, 2020, up to an amount equivalent to eligible operating costs. Amount forgiven will not be taxable for the borrower.
4. The borrower repays any remaining balance, in excess of eligible operating costs, after forgiveness as a 10-year term loan.
1 Applicable to all states for which the President has declared as Coronavirus Disaster Area (CDA). At the time of issuing this newsletter, these are the states who has been CDAs: New York, Washington, California, Iowa, Louisiana, Florida, Texas, North Carolina, New Jersey, and Michigan. Also, the SBA is working with FEMA and granting financing under special conditions, so Small business owners in all U.S. states and territories are currently eligible to apply for a low-interest loan due to Coronavirus (COVID-19).
2 There is a complex calculation to determine the maximum amount of loan under the recently signed CARES Act
3 Operating costs, include: Employee salaries, commissions or compensation, Other payroll costs, Healthcare insurance premiums, Paid sick, medical and family leaves, Rent, Interest payments on mortgages, Interest on other debt issued before February 15, 2020, Utilities and for refinancing SBA loans issued between January 31, 2020 and the date you take out the Paycheck Protection Loan.
Read the Business Owners’ Guide to the CARES Act
At Guillen Pujol CPAs, we are ready to assist in the determination of the maximum amount that you can apply for, the completion of all these forms and preparing all necessary additional documentation, and even act as your agents to follow up through all the process with the SBA lender for this loan application.
Announcement about Florida Division if Corporations File Annual Report
“Pursuant to Executive Order No. 20-52 and Department of State Emergency Order 2020-01, signed March 27, 2020, the time requirements for business entities to file annual reports are suspended and tolled until June 30, 2020. Any profit corporation, limited liability company, limited partnership or limited liability limited partnership annual report filing will have until 12:01 am on July 1, 2020, before a $400 late fee is assessed.”
Annual reports are due by the third Friday in September to avoid administrative dissolution.
Announcement Regarding Relief from Certain Filing and Payment Deadlines due to the Novel Coronavirus, COVID-19.
Andrew M. Cuomo of New York has issued an executive order authorizing the Commissioner to provide relief from certain tax filing and payment deadlines.
Accordingly, the Commissioner has extended the April 15, 2020 due date to July 15, 2020, for New York State personal income tax and corporation tax returns originally due on April 15, 2020. In addition, the Commissioner is allowing taxpayers to defer all related tax payments due on April 15, 2020 to July 15, 2020, without penalties and interest, regardless of the amount owed.
For additional information, click here to visit Tax Department response to novel coronavirus (COVID-19)
Please feel free to contact us if you need any further information. Stay Safe.
Nestor L. Guillen
Founder, CEO Guillen Pujol CPAs
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