April 1, 2020
Treasury Guidance on SBA forgivable loan provision. More information is emerging about the emergency Covid-19 business relief enacted last week. Yesterday saw Treasury releases, including:
Treasury Encourages Businesses Impacted by COVID-19 to Use Employee Retention Credit
Paycheck Protection Program (forgivable loan) Fact Sheet for Borrowers
Paycheck Protection Program (forgivable loan) Fact Sheet for Lenders
Paycheck Protection Program Sample Application Form.
Eide Bailly will conduct a free webinar "SBA Relief: What do these efforts mean for you?" Friday, April 3, at 10:00 A.M. Register here.
What You Need to Know About the SBA Loan and Relief Efforts - Adam Sweet and Michael Holdren, Eide Bailly.
Small Business Loans – We Finally Have Some Answers - Timothy K. Sundstrom, Thomson Reuters Tax & Accounting. "The loans are available though any bank that is an SBA lender."
Paycheck Protection Loans Coming Soon - Peter Reilly, Forbes. "SBA Administrator Jovita Carranza has announced that the program is on a very fast track."
IRS issues penalty waiver for employment taxes affected by Coronavirus relief legislation. IRS press release: "Notice 2020-22 provides a waiver of additions to tax for failure to make a deposit of taxes for employers required to pay qualified sick leave wages and qualified family leave wages mandated by the Families First Coronavirus Response Act (Families First Act) and qualified health plan expenses allocable to these wages.... This notice applies with respect to deposits of Employment Taxes reduced in anticipation of the credits with respect to qualified wages paid with respect to the period beginning on March 13, 2020, and ending December 31, 2020."
States Aggressively Contracting With Transfer Pricing Experts - Amy Hamilton and Andrea Muse, Tax Notes ($). An article showing how states are using consultants, interstate information sharing agreements, and national training sessions to deal with transfer pricing issues:
At least 23 state revenue departments and the District of Columbia have recently done one or more of the following:
- contracted with outside experts for transfer pricing services;
- executed special transfer pricing information exchange agreements, which enable revenue officials from multiple states to share taxpayer documents and engage in case discussions; or
- sent revenue staff to national two-day training exclusively focused on instruction on section 482 and transfer pricing.
Those jurisdictions are Alabama, Arkansas, Connecticut, Delaware, the District of Columbia, Florida, Georgia, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Massachusetts, Mississippi, Missouri, New Jersey, North Carolina, Oregon, Pennsylvania, Rhode Island, Utah, West Virginia, and Wisconsin.
Taxpayers who ignore multistate issues in hopes that states won't notice them should take note.
Related: What Is Transfer Pricing & How Can It Impact Your Business? Jason Fritts, Eide Bailly.
New Jersey Waives Telework Nexus During COVID-19 Crisis - Jared Walczak, Tax Policy Blog. "New Jersey is temporarily waiving corporate nexus arising from employees teleworking due to the COVID-19 pandemic—a response to the crisis that other states should follow."
Iowa DOT, lawmakers anticipate decline in fuel tax revenue - James Q. Lynch, Quad Cities Times. "The Iowa Department of Transportation’s 120 automatic traffic recorders embedded in streets and highways show the number of vehicles on streets, roads, highways and interstates has fallen by nearly 50% compared to a year ago."
IRS Adds To Confusion About Whether Seniors Have To File Tax Returns To Get Stimulus Checks - Kelly Phillips Erb, Forbes. "On Monday, the Internal Revenue Service (IRS) posted a notice about the checks. The guidance included several sentences that seem contrary to the language in the law. Specifically, the guidance advised, 'However, some seniors and others who typically do not file returns will need to submit a simple tax return to receive the stimulus payment.'"
What's in the CARES Act? Part Two - Business Tax Provisions - Kristine Tidgren, The Ag Docket. "Section 2302 of the CARES Act allows employers to temporarily defer payment of the employer’s portion of social security and RRTA payroll taxes."
No RMD due April 1 (no fooling) or any time in 2020 - Kay Bell, Don't Mess With Taxes. "RMDs are waived for 2020 under the CARES Act. That means you can leave your money in your tax-deferred account this year or at least not take as much out as Uncle Sam demands."
What Tax Experts Can Contribute: Lessons from World War II - Eric Toder, TaxVox. "Instead of increasing individual income tax liability for more people, the new mass tax may take the form of a value-added tax now in use by over 150 countries throughout the world."
Coronavirus Stimulus Payments: When Will They Be Sent and Who Is Eligible? - Richard Rubin, WSJ ($). "The IRS could start issuing payments within three weeks, but said it will move significantly slower for those who will need paper checks." Also: "The government will use 2019 tax returns to set the payment amounts and 2018 tax returns if 2019 isn’t available."
Stimulus Check FAQs - Robert W. Wood, Forbes.
Part I: What I Worry About When I Think About the IRS and the CARES Act - Nina Olson (Retired IRS Taxpayer Advocate), Procedurally Taxing:
To stimulate the economy, the IRS is poised, as it was in 2001 and again in 2008, to send out over 100 million payments – in addition to those it is processing and issuing as part of the regular filing season. In 2001, the IRS’s master file system – the official record of taxpayer accounts which GAO has labelled the oldest databases in the federal government – was, in Commissioner Rossotti’s words, “ancient.” ...this software is still around today, only it is 19 years older – and now qualifies as being called “prehistoric.”
What could go wrong?
This is a roundup of tax news and opinion. Any opinions expressed or implied are those of the author and not necessarily those of Eide Bailly. Opinions found in linked items are those of the authors of the linked item, not of your bloggers or of Eide Bailly. “$” means link may be behind a paywall. Items here do not constitute tax advice.