LAP Financial Services

Share to Facebook Share to Twitter Share to Linkedin Finally! This was the week millions Americans were expecting to receive their $1,200 stimulus payments from the federal government. The funds, part of the $2.2 trillion-dollar Coronavirus Aid, Relief, and Economic Security (CARES) Act , are meant to provide a much needed cash infusion for individuals struggling due to the economic downturn. "We expect over 80 million hard-working Americans will get the direct deposit by this Wednesday," said U.S. Treasury Secretary Steven Mnuchin at a Monday press briefing.     Many individual did receive  payment via direct deposit from The Treasury Department, if it had their bank-account information from their 2018 or 2019 tax returns on file; however, others have been left to wonder, “where’s my money?” Finding the answer is proving to be difficult and confusing. To allow Americans to track the status of their stimulus payments, the IRS and Treasury Departmen...

Today the Consumer Financial Protection Bureau (Bureau) took steps to make it easier for consumers to receive pandemic-relief payments, including the economic impact payments authorized in the CARES Act, through prepaid accounts. Federal, State, and local governments are considering a variety of approaches to providing consumers relief from the economic impacts of the COVID-19 pandemic. “In these unprecedented times, policymakers are acting swiftly to provide consumers with needed financial support through new mechanisms and for new purposes outside of existing government benefit programs,” said CFPB Director Kathleen L. Kraninger. “The steps we are taking today ensure that consumers can receive these payments in a fast, secure, and efficient manner.” Government agencies may not always be able to use direct deposit to distribute funds because they do not have access to consumers’ account information, such as account and routing numbers, and because some consumers receiving payment...

As of this morning, the IRS has released the Get My Payment tool on their website at  https://www.irs.gov/coronavirus/economic-impact-payments This Tool is similar to the Where’s My Refund tool, customers will be able to see the status of their payment and the last 4 digits of the bank account it was sent to if a direct deposit. For bank product customers who have their payment being routed through Third Party Banks, the Bank Account Number for the direct deposit will show as the last 3 digits of their SSN plus a 0.  The tool can also be used to add Direct Deposit information for Taxpayers that did not furnish the IRS with bank accounts for deposits.  

The U.S. Small Business Administration issued a new interim final rule Tuesday that supplements the guidance for the Paycheck Protection Program (PPP) included in the first interim final rule for the PPP issued on April 2 and FAQs that are being updated periodically. The additional guidance provides specific information on calculating the maximum loan amount for individuals with self-employment income who file a Form 1040, Schedule C, Profit or Loss From Business . The 2019 Form 1040 Schedule C is required to be provided with the PPP loan application, according to the interim rule, which notes that detailed documentation guidelines are also required. Guidance is also provided on how PPP loans may be used and how loan forgiveness will be calculated. The SBA stated it will issue additional guidance for those individuals with self-employment income who: (1) were not in operation in 2019 but who were in operation on Feb. 15, 2020, and (2) will file a Form 1040 Schedule C for 2020...

Due to the pandemic, millions of taxpayers are now working from home. Although the IRS has not yet issued any guidance on whether they would receive special deductions, a current case was decided for the taxpayer.  A taxpayer in a new case, Benton TC Summary Opinion 2020-12, 3/11/20 ,  worked out of a house in the suburbs and deducted the rent his business paid to use the place as an ordinary and necessary business expense. Generally, you can deduct rent paid by your business for use of a building, such as office building or warehouse, where you conduct business activities. But it’s not as clear-cut if you operate the business in a house normally intended to be used as a personal residence. The Taxpayer in this case relied on Code Section 162(a) , that allows  Ordinary and Necessary business expenses Including rent. Code Section 162(a) states that " In general There shall be allowed as a deduction all the ordinary and necessary expenses paid or incurred during ...

To help everyone check on the status of their payments, the IRS is building a second new tool expected to be available for use by April 17. Get My Payment will provide people with the status of their payment, including the date their payment is scheduled to be deposited into their bank account or mailed to them. An additional feature on Get My Payment will allow eligible people a chance to provide their bank account information so they can receive their payment more quickly rather than waiting for a paper check. This feature will be unavailable if the Economic Impact Payment has already been scheduled for delivery . To help millions of people, the Treaury Department and the Internal Revenue Service today launched a new web tool allowing quick registration for Economic Impact Payments for those who don’t normally file a tax return. The non-filer tool, developed in partnership between the IRS and the Free File Alliance, provides a free and easy option designed for people...

The Paycheck Protection Program (“PPP”) authorizes up to $349 billion in forgivable loans to small businesses to pay their employees during the COVID-19 crisis. All loan terms will be the same for everyone The loan amounts will be forgiven as long as:  The loan proceeds are used to cover payroll costs, and most mortgage interest, rent, and utility costs over the 8 week period after the loan is made; and   Employee and compensation levels are maintained Payroll costs are capped at $100,000 on an annualized basis for each employee. Due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs. Loan payments will be deferred for 6 months When can I apply?   Starting April 3, 2020, small businesses and sole proprietorships can apply for and receive loans to cover their payroll and other certain expenses through existing SBA lenders. Starting April 10, 2020, independent contractors and self...

The CARES Act expands and provides funding for several U.S. Small Business Administration (SBA) programs that primarily are intended for "small business concerns." A small business concern for SBA purposes generally only includes for-profit entities that are independently owned and operated, unless specific provisions are carved out for nonprofits. However, some programs in the new CARES Act permit certain nonprofit organizations to participate. Starting with Mid Size institutions The CARES Act provides funding and liquidity in the Federal Reserve System for a new program to provide financing to banks and other lenders that make loans – with no higher than 2 percent interest and no principal or interest payments due for the first six months – directly to nonprofit organizations. To be eligible, a religious institution must have between 500 and 10,000 employees and must be a U.S. entity with significant operations in the U.S. and a majority of its employees located in the U...

The Internal Revenue Service today urged taxpayers to be on the lookout for a surge of calls and email phishing attempts about the Coronavirus, or COVID-19. These contacts can lead to tax-related fraud and identity theft.  . The IRS isn't going to call you asking to verify or provide your financial information so you can get an economic impact payment or your refund faster.  Taxpayers should watch not only for emails but text messages, websites and social media attempts that request money or personal information The IRS and its Criminal Investigation Division have seen a wave of new and evolving phishing schemes against taxpayers. In most cases, the IRS will deposit economic impact payments into the direct deposit account taxpayers previously provided on tax returns. Those taxpayers who have previously filed but not provided direct deposit information to the IRS will be able to provide their banking information online to a newly designed secure portal on IRS.gov in mid-Ap...

IRC 6428 REBATE Economic Injury Disaster Loan APP     SBA Guidance The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) provides payments to taxpayers (subject to income limits) in the way of a credit under §6428 of $1,200 per individual ($2,400 for married couples filing a joint return) plus $500 per qualifying child who is under age 17 (as defined under §24(c)). The payment is reduced by 5% of the taxpayer’s adjusted gross income in excess of $75,000 ($112,500 for head of household; $150,000 for joint filers). The payment will fully phase out when income reaches $99,000 for single filers, $146,500 for head of households with one child and $198,000 for joint filers. 2020 Recovery rebates for individuals (section 2201): Tax credits are provided for individuals in the amount of $1,200 for single returns and $2,400 for joint returns plus $500 for each child (under age 17 and qualifying for the child credit); Credits are reduced by 5% of the excess...