Treasury Secretary Steven Mnuchin announced Tuesday that his department has pushed back the April 15 deadline to pay taxes owed, giving individuals and many businesses 90 extra days to send payments to the government.
Individuals can defer up to $1 million of tax liability and corporations get an extension up to $10 million. The payment extension, which affects millions of taxpayers, is part of the Trump administration’s effort to curb the economic effects of the coronavirus pandemic. Mr. Mnuchin said the delay will free $300 billion of liquidity in the economy as individuals and businesses have more time to pay their taxes.
The IRS will continue to process tax refunds, and Mr. Mnuchin urged people who can file their tax returns to do so. Mr. Mnuchin said last week that the tax payment deadline would be delayed for all but the superrich, but his Tuesday announcement was the first explanation of the length of the delay and how it might work. The tax agency hasn’t yet released full details about how the delay will work.
The government granted the extension to give taxpayers a financial cushion as households and businesses cope with the sudden slowdown in economic activity caused by the coronavirus outbreak. The move could provide households with hundreds of billions of dollars in temporary liquidity, Mr. Mnuchin said last week in previewing the government’s actions.
Delaying payment requirements will give businesses and individuals nearly three more months to meet their IRS obligations, potentially lessening cash-flow issues that some businesses are facing as many people stay home and spend less money on dining out, entertainment and transportation.
Unemployment Insurance Resources Available to Employers and Workers Affected by COVID-19
If you or your employees have been affected by COVID-19 or are caring for ill family members, the Connecticut Department of Labor (DOL) has provided information regarding employers and employees filing for unemployment insurance.
Federal law permits states to amend their laws to provide unemployment insurance benefits in multiple scenarios related to COVID-19. For example, federal law allows states to pay benefits where:
• An employer temporarily ceases operations due to COVID-19, preventing employees from coming to work;
• An individual is quarantined with the expectation of returning to work after the quarantine is over; and
• An individual leaves employment due to a risk of exposure or infection or to care or a family member.
In addition, federal law does not require an employee to be permanently separated to receive benefits due to the impact of COVID-19.
For more information and frequently asked questions regarding the unemployment insurance, please visit http://www.ctdol.state.ct.us/DOLCOVIDFAQ.PDF
COVID-19 Disaster Relief Loans for Small Businesses
On Monday, March 16th, the Governor’s office announced that Connecticut small businesses can now apply for COVID-19 related disaster relief loans of up to $2 million directly from the U.S. Small Business Administration (SBA).
Small businesses can learn more about the program and apply for financial assistance at https://www.sba.gov or call the SBA at 1-800-659-2955.
Small businesses with questions about this SBA loan program or other assistance provided at the state-level can call 860-500-2333 to speak directly with a DECD representative. Businesses can visit the state’s dedicated coronavirus website at ct.gov/coronavirus to stay informed on news and guidance related to COVID-19 and its impact on Connecticut
Please contact us with any questions you may have. Wishing you good health during these extraordinary times.
Scott Crane, Managing Partner
REYNOLDS & ROWELLA | ACCOUNTING AND CONSULTING FAIRFIELD COUNTY CT
Reynolds + Rowella is a regional accounting firm known for a team approach to financial problem solving. As Certified Public Accountants, our partners foster a personal touch with our clients. As members of DFK International/USA, an association of accountants and advisors, our professional network is international, yet many of our clients have known us for years through the local communities we serve.
Our mission is to operate as a financial services firm of outstanding quality. Our efforts are directed at serving our clients in the most efficient and responsive manner possible, delivering services that exceed the expectations of those we serve.
The firm has offices at 90 Grove St., Ridgefield, Conn., and 51 Locust Ave., New Canaan, Conn. For more information, give us a call at 203.438.0161 or email us.