You may have heard that Congress passed the Emergency Coronavirus Relief Act of 2020 (ECRA). This 5,465-page document is being presented to the President for signature. Assuming that it is signed, there are very significant changes to your business.
PPP and small business support: New Covid -19 package provides much needed support for small businesses.
- Business expenses paid for with the proceeds of the PPP loans are tax deductible.
- The loan forgiveness process is simplified for borrowers with PPP of $150,000 or less.
- If your initial loan was computed with less than the amounts entitled, you may get additional funds. If you already got forgiveness on the PPP loan, you may not be eligible for this part.
- Certain businesses that had a reduction of revenues of 25% or more may get additional PPP loans. This is a complex calculation, but many people experienced such a decline.
Economic Impact payment (EIP): Certain taxpayers will receive a second round with reduced amounts of $600 and $600 for a child. If you were eligible this spring, you will probably be eligible now.
There is Rental Assistance until January 31, 2021 and Student Loan forbearance through April 1, 2021.
There are payroll tax delays, tax extenders, charitable contribution changes and other tax law changes.