Author Archives: Jeramiah Young

Economic Injury Disaster Loan Advance

On March 29th following the passage of the CARES Act, the SBA provided small business owners and non-profits impacted by COVID-19 with the opportunity to obtain up to a $10,000 Advance on their Economic Injury Disaster Loan (EIDL). The Advance is available as part of the full EIDL application and will be transferred into the account you provide shortly after your application is submitted. To ensure that the greatest number of applicants can receive assistance during this challenging time, the amount of your Advance will be determined by the number of your pre-disaster (i.e., as of January 31, 2020) employees. The Advance will provide $1,000 per employee up to a maximum of $10,000.

You may be eligible for another loan program, the Paycheck Protection Program, which is available through participating lenders. Below is a comparison of the two loan programs.

Paycheck Protection Program

Full EIDL Loan

PURPOSE Forgivable if used for payroll (minimum of 75% of the funds received) and the remaining for certain operating expenses that could have been met had the disaster not occurred. To meet financial obligations and operating expenses.
TERMS Up to $10 million
1% interest rate
Up to $2 million
3.75% for businesses
2.75% non-profits
FORGIVABLE YES NO- EIDL Loan
YES- EIDL Advance
MATURITY 2 years 30 years
FIRST PAYMENT DUE Deferred 6 months Deferred 1 year

Stimulus Payments and Social Security

The IRS has announced that Social Security recipients will automatically receive economic impact payments.

Those receiving Social Security benefits who do not typically file a tax return will not need to file an abbreviated (simple) tax return to receive the stimulus payment. The IRS will use information from the SSA-1099 and RRB-1099 to generate payments for those individuals. The payment will be sent as a direct deposit or check, however they normally receive their benefits.

Social Security recipients who are not typically required to file a tax return need to take no action.

The IRS still plans to offer an online portal for the purpose of collecting deposit information from taxpayers who haven’t provided it on a 2018 or 2019 tax return.

Providing account information is not required to receive a stimulus payment.

Checks will be mailed if deposit information is not available. 

At the time of this posting, no guidance has been received regarding low-income taxpayers who are not required to file a tax return and do not receive Social Security benefits.

Taxpayers Should Be Wary of Unsolicited Calls for the IRS

Taxpayers who get an unexpected or unsolicited phone call from the IRS should be wary – it’s probably a scam.

Taxpayers who don’t owe taxes or who have no reason to think they do should follow these steps:

  • Use the Treasury Inspector General for Tax Administration’s IRS Impersonation Scam Reporting web page to report the incident.
  • Report it to the Federal Trade Commission with the FTC Complaint Assistant on FTC.gov.

Taxpayers who think they might actually owe taxes should follow these steps:

  • Ask for a call back number and employee badge number.
  • Call the IRS at 1-800-829-1040.

For Additional Information visit:  IRS YouTube Videos

Tax Relief to Victims of Hurricane Harvey & Irma; Extension Filers Have Until January 31 to File

Hurricane Irma victims in parts of Florida and elsewhere have until Jan. 31, 2018, to file individual and business tax returns and make certain tax payments. This includes an additional filing extension for taxpayers with valid extensions that run out on Oct. 16, and businesses extensions that run out on Sept. 15.

The IRS will continue to closely monitor the storm’s aftermath, and anticipate providing additional relief for other affected areas in the near future. The IRS is offering this relief to any area designated by the Federal Emergency Management Agency (FEMA), as qualifying for individual assistance. Parts of Florida, Puerto Rico and the Virgin Islands are currently eligible, but taxpayers in localities added later to the disaster area, including those in other states, will automatically receive the same filing and payment relief. The current list is available on the disaster relief page on IRS.gov.

The tax relief postpones tax filing payment deadlines. As a result, affected individuals and business will have until Jan. 31 2018, to file returns and pay any taxes originally due including Sept. 15, 2017 and Jan. 16, 2018 deadlines for making quarterly estimated tax payments. For individual tax filers, it also includes 2016 income tax returns that received a tax filing extension until Oct. 16, 2017.  HOWEVER, because tax payments related to these 2016 returns were originally due on April 18, 2017, those payments are not eligible for this relief.

A variety of business tax deadlines are also affected including the Oct. 31 deadline for quarterly payroll and excise tax returns. Businesses with extension have additional time including:

  • Calendar year partnerships whose 2016 extensions run out on Sept. 15, 2017
  • Calendar year tax exempt organizations whose 2016 extensions run out on Nov. 15, 2017.

IRS is waiving late deposit penalties for federal payroll and excise tax deposits normally due during the first 15 days of the disaster period. IRS automatically provides filing and penalty relief to any taxpayer with an IRS address of recorded located in the disaster area. If an affected taxpayer receives a late filing or late payment penalty notice from the IRS that has an original or extended filing, payment or deposit due date falling within the postponement period, taxpayer should call.

The IRS will work with any taxpayer who lives outside the disaster are but whose records necessary to meet a deadline occurring during the postponement period are located in the affected area. Taxpayers qualifying for relief who live outside the disaster area need to contact the IRS at 866-562-5227. This also includes workers assisting relief activities affiliated recognized government or philanthropic organization.

Individuals and businesses who suffered uninsured or unreimbursed disaster related losses:

  • Can choose to claim them on either the return for the year the loss occurred (2017) or
  • The return for the prior year (2016).