As part of the “stimulus” package to reinvigorate the economy during the COVID-19 pandemic, taxpayer rebates and small-business relief are on the way.
This includes Social Security beneficiaries (retirement, disability, survivor) and Supplemental Security Income (SSI) recipients, according to the House Committee on Ways and Means.
“These assistance efforts have been implemented incredibly rapidly for the federal government and should help those who have been negatively affected by the events of the past few weeks.,” said CPA Chris Scoggin of Chaston Tax and Accounting in an InMaricopa column.
The full rebate amounts are $1,200 per adult and $500 per qualifying child. Stimulus payments will be going out in three to four weeks (possibly sooner depending upon how quick the IRS gets these payments issued).
“It is important to file a 2019 or 2018 tax return as soon as possible so the IRS knows where to send the funds,” said Maricopa CPA Richard Weisenberg. “The IRS has pushed back the filing deadline to July 15 as well as for payments. Payments are not due until July 15 for the individual 1040 tax return.”
Everyone is eligible for the full rebate payments as long as they have an SSN and their household income is not too high, according to the Ways and Means Committee. Rebate payments start to phase out at the thresholds of $75,000 single, $112,500 head of household, and $150,000 married.
Small Business Administration loans are also being forgiven and debt-relief offered. There are about $10 billion in grants available in grants for small businesses.
The stimulus package:
- Requires SBA to provide additional language resources to ensure small business owners can access the resources they need as easily as possible.
- Includes $265 million in funding for resource partners, including Small Business Development Centers and Women’s Business Centers to provide training and counseling to businesses impacted by Coronavirus.
- Has a waiver of the WBC matching requirement to alleviate the need to fundraise during the emergency.
- Includes $10 million for Minority Business Development Agency grants to train and counsel minority-owned firms impacted by Coronavirus.
- Includes $675 million to provide SBA with the resources it needs to staff up and administer these new and enhanced programs.
Finally, this will increase the number of small businesses that qualify for streamlined bankruptcy process, by nearly tripling the debt cap to $7.5 million to help American small businesses that will need to reorganized due to the COVID-19 pandemic.
“I would highly recommend applying through SBA to get the necessary funds to get through operating expenses (payroll, rent, etc.),” Weisenberg said. “There are many rules you must adhere to in order to get the loan forgiven.”
The Act’s payroll tax provisions have no effect on Social Security’s trust funds:
- The bill lets employers temporarily delay payment of their share of Social Security payroll taxes. This does not mean they don’t owe those taxes, but rather that they will make the payments in 2021 and 2022. This effectively allows the Federal government to loan these businesses funds to ensure they can continue operating during this crisis.
- Additionally, certain provisions in the CARES Act, and the recently enacted Families First Coronavirus Response Act, rely on payroll tax credits to provide much-needed support for businesses during this time.
- None of these provisions change the amount or timing of money deposited into the Social Security trust funds, as the bill replenishes the trust funds from general revenues.
- They also do not alter the fundamental nature of Social Security as a contributory system where individuals earn their benefits with each paycheck.