JFS LLC Interpretation of the CARES Act

Apr 2, 2020 | Business Strategy, Income Tax

Last week the US Government passed an act that offers incentives, loans, grants, and tax changes to individuals and businesses. Below is a brief summary of the act. If you have any questions, please feel free to reach out to the JFS team and we can assist.

Loans:

There are four loans that became available through the Act. These are listed below. Each of these loans has different requirements, calculations and ramifications. If you are interested in any of these loans and would like assistance in the application process, please feel free to contact the JFS office.

  • PPP – Paycheck Protection Program
    • This is a program offered through different lenders that are approved by the SBA. It is calculated based on payroll; however, it can be used for payroll, rent, utilities and mortgage interest.
  • SBA 7(a) Loan
  • SBA Express Loan
  • EIDL Loan

Grants:

  • There is a stimulus grant payment to each qualifying taxpayer of $1200.00 plus $500.00 per qualifying child under the age of 17.
    • There are limitations of gross income based on filing status that can affect the eligibility for this payment.
  • Unemployment – this is the normal rate plus an additional sum per week
  • EIDL Loan – there is a component that can later become a grant

Tax Provisions:

There are many tax provisions in the bill. Below are just a few.

  • Qualified Improvement Property is now subject to bonus depreciation
  • You can now use a Net Operating Loss (NOL) and carry it back to prior years
  • There is a business income limitation
  • Estimated tax payment date changes

Related Posts