The below is a summary of legislation recently adopted in response to the coronavirus pandemic which may affect you and/or your business. Please note that the federal bill only passed late on March 25, 2020 and therefore the summary of the relevant provisions is based upon reported provisions in that bill.
Federal Legislation
- There is a provision for loans for small businesses for expenses normally incurred during a period of ten weeks and the business would not need to repay up to 80% of the loan if it did not lay off any employees or by June 30th it rehires the employees previously laid off. Loans are capped at $10 Million and based upon a formula tied to payroll cost for employees making up to $100,000.00 per year. These loans are intended to cover salaries, insurance, rent and other operating costs for businesses with fewer than 500 employees, and the amount which would be forgiven will be the amount the business actually pays for payroll plus mortgage payments, etc. for eight weeks after the loan origination.
- Every individual earning up to $75,000.00 per year (or $150,000.00 per couples), using last filed tax return, is entitled to a one time lump sum payment of $1,200.00 per adult and $500.00 per dependent child. If you earn an excess of $75,000.00 per year, the amount phases out as your earnings increase, and phases out entirely through a single tax payer earning $99,000.00 with no children or joint taxpayers earning $198,000.00 with no children.
- Additional funding was provided to the SBA to make working capital loans of up to $2 Million to assist businesses in overcoming demonstrated temporary loss of revenue as a result of the disaster. Special SBA loans, administered by the state, with expedited processing, are also available.
- Employees immediately qualify for unemployment insurance (there is no waiting period) and the amount for which the employee would normally receive as unemployment is increased by $600.00 per week for up to four months. It also provides for as many as 13 weeks of payments for workers whose state benefits end before they can return to work. In addition, certain individuals who did not previously qualify for unemployment benefits are now eligible.
- Federal and state tax filings due April 15th will not be due until July 15th, and interest and penalties on sales and other tax filings due for this period are suspended. In addition, employer side social security payroll tax payments may be delayed until December 31, 2021.
- There is additional paid sick leave for those who test positive or are required to be quarantined, and there is additional family medical leave for those who need to provide childcare as a result of the child’s school being closed and employers may be immediately reimbursed for those qualifying sick and family leave payments.
- Employers are eligible for a 50% payroll tax credit on wages up to $10,000.00 paid during the crisis if they had a decrease in receipts of 50% or more compared to the same quarter last year.
New York State
- New York State has adopted a shared work program which would permit employees to receive partial unemployment insurance benefits while working reduced hours for their employers. There are certain restrictions. If you believe this may apply to you, please visit https://labor.ny.gov./ui/dande/sharedwork1.shtm.
- There are bills proposed (but not yet passed by the senate or assembly) which would provide grants to help small businesses offset lost revenue (Bill S8110), suspend mortgage and loan payments from state chartered banks and credit unions for small businesses and restaurants that have closed or reduced services (Bill S8109), provide additional sick leave and family leave benefits (Bill S8090), and waive commercial and residential rent for tenants that have lost employment or businesses forced to close (Bill S8125). It is questionable whether this legislation will become law, and if so the exact details, thus do not rely upon any such proposed laws in making your financial decisions.
New York City Programs
- New York City has expanded its definition of sick leave to include the diagnosis, care or treatment of employees or family members or the closing of a business or school due to a public health emergency.
Please note that you should not rely upon any of the above inasmuch as this information is based on reports on the contents of the actual legislation and thus none of the above is a representation or statement of the actual applicable law. If you believe that any of these programs would benefit you and you desire our assistance in further researching and/or applying for same, please do not hesitate to contact us. The laws are constantly changing and we will attempt to continue to update you on those change which we may believe would be applicable to you or your business.
