A BCW webinar held Monday entitled Washington’s $2 Trillion Dollar Stimulus Package: What Will the Impact be for Westchester’s Economy and Businesses? featured a panel of experts who discussed how local businesses, non-profits and individuals could benefit from the aid package passed by the Senate and House and signed by the President last week. The CARES act, the largest economic stimulus package in history, will provide direct payments to Americans and loans to large and small businesses, dramatically expand unemployment insurance to cover freelance and gig workers and extend additional resources to health-care providers.
“The businesses community needs timely answers to the many questions arising daily as well as resources to connect to services,’’ said Marsha Gordon, President and CEO of the BCW. “The webinar was invaluable in that it brought together experts who helped to unpack the relevant details in the stimulus package. It is still being shared widely on social media as more people want to know how to apply for benefits. The BCW will continue to provide resources for our members and the public throughout this crisis.’’
The BCW panel was moderated by Dr. Gordon and featured Anthony Justic, Partner, Certified Public Accountant, Maier, Markey & Justic LLP; Bryan X. Grimaldi, Of Counsel, Greenberg Traurig, LLP; and Monica Prahl Schulteis, Director, Government Affairs, Greenberg Traurig, LLP.
Justic, who led off the program, said the CARES act was 880 pages long and had four main sections:
Title I — Keeping American workers paid and employed
Title II — Assistance for American Families, Workers and Businesses
Title II — Supporting America’s Healthcare System in the Fight Against Coronavirus
Title IV — Economic Stabilization and Assistance to Severely Distressed Sectors of the US Economy
He said the most relevant to local businesses were Title I and II. He detailed some of the benefits for businesses and individuals. Here were some takeaways from the program:
Paycheck Protection Program — Intended to keep employees off unemployment, the program provides forgiveable loans to businesses. Eligible costs include payroll, interest on debt, rent etc. The loans are are 100 percent guaranteed by the federal government. The forgiveness is based on a formula having to do with the number of employees who remain on the payroll. Forgiveness can also be granted if employees return to work before June 30, 2020.
Almost all banks are participating in making these loans. Business should begin assembling paperwork and contact their banks to find out when they will begin to accept applications. CLICK HERE FOR MORE INFORMATION. CLICK HERE FOR APPLICATION FORM
Employee Retention Credit — Businesses who are subject to closure or whose gross receipts have declined more than 50 percent from the same quarter in 2019 due to COVID-19 are eligible. The amount that can be recouped is equal to 50 percent of qualified wages paid subject to a cap of $10,000 per eligible employee and there is a different threshold for employers of 100 or more with more favorable terms for employers of under 100.
Employer payroll tax extension — Employers could defer payment of payroll tax to help with cash flow. They would be required to pay 50 percent by year-end 2021 and 50 percent by year-end 2022.
Carry back net operating losses in 2018, 2019, 2020. Businesses can carry back losses for up to five years to fully offset income.
Payments to employees — Businesses can deduct payments to employees for COVID-19 related expenses before January 1, 2021 such as childcare and home office expenses.
Rebate checks of $1,200 will be sent to single individuals with incomes of under $75,000 and heads of households with incomes under $112,500. Joint income tax filers with incomes under $150,000 are eligible to receive $2,400. Five hundred dollars is added for each child under 17. The government will be mailing checks directly to taxpayers. No action is needed.
Waiver of early distribution penalty — The 10 percent penalty for taxpayers under the age of 59 will be waived on any distributions taken from 401Ks and pension/retirement funds.
Loans Against Retirement Plans — The limit on loans that can be taken on any qualified employer retirement plan are increased from $50,000 to $100,00. Repayment can be delayed for 1 year of original due date.
Waive 7-day Waiting Period on Unemployment — People filing for unemployment can do so immediately without having to wait for the customary 7-day waiting period.
To view the video of the webinar in its entirety, CLICK HERE.
For additional information on the Care Act or any other loans or benefits available as a result of the COVID-19 crisis or additional resources, CLICK HERE.