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A Message to Our Valued Clients

In the interest of public health and the safety of our community, and in compliance with Governor Cuomo’s executive order, Freed Maxick has suspended onsite client work and cancelled all office visits. Meanwhile, our team is working remotely to provide the same high-quality service you have come to expect. Utilizing the best technology at our disposal, we will continue to meet all of your audit, tax, and advisory needs and help you navigate the business implications of the pandemic as it unfolds. You can reach your Freed Maxick representative directly by email or phone, or contact our main line at 716.847.2651.

COVID-19 Response Center

Freed Maxick's commitment to you during the COVID-19 crisis.


As we are in the midst of a global pandemic, be assured that the health and well-being of our clients, team members, colleagues and their families are of utmost importance to us. As we are keenly aware of the acute challenges businesses and employers are facing in connection with the coronavirus outbreak, we have formed dedicated internal teams and resources to focus on the following areas:

  • Small business cash flow needs, including integration of the various Small Business Administration loan programs in the CARES Act with federal and state tax deferral programs;
  • Employer and employment needs, including integration with the Families First Coronavirus Response Act;
  • Individual needs, including individual rebates and retirement plan relief; and
  • Specialized industry response related to: Agribusiness, Healthcare, Non-profit, Real estate, Financial institutions, Manufacturing, wholesale, and distribution

This legislation is complex, evolving and will unfold over the next several weeks and months, but we are working constantly to be a resource for our clients and communities in this time of need to provide clear and concise guidance. Please reach out to your Freed Maxick engagement leader for more information and stay tuned for updates to this resource center. Contact us to discuss planning ideas applicable to your situation.

To learn more about how Freed Maxick is currently operating, click here for our remote workforce communication.

Latest COVID-19 News

Opportunity Zones & IRS Guidance Updates | Freed Maxick

On June 4, 2020, the IRS released Notice 2020-39 which provides relief under the federal Qualified Opportunity Zone (“QOZ”) program as follows: 1.) 180-Day Investment Requirement for QOF Investors 2.) 90-Percent…

FM Opp Zones

On June 4, 2020, the IRS released Notice 2020-39 which provides relief under the federal Qualified Opportunity Zone (“QOZ”) program as follows:

  • 1.) 180-Day Investment Requirement for QOF Investors
  • 2.) 90-Percent Investment Standard for QOFs
  • 3.) Working Capital Safe harbor for QOZ Businesses
  • 4.) 30-Month Substantial Improvement Period for QOFs
  • 5.) 12-Month Reinvestment Period for QOFs

Qualified Opportunity Zones and COVID-19 Emergency Declaration

On March 13, 2020, the President issued an emergency declaration in response to the ongoing COVID-19 pandemic instructing the Secretary of the Treasury “to provide relief from tax deadlines to Americans who have been adversely affected by the COVID-19 emergency, as appropriate, pursuant to 26 USC 7508A(a).” Subsequently, major disaster declarations were issued by the President stating that, beginning on January 20, 2020, major disasters existed in all 50 states, the District of Columbia, and the 5 territories. 

On April 9, 2020, Treasury and the IRS issued Notice 2020-23 to provide relief under section 7508A(a) to taxpayers affected by the COVID-19 emergency by postponing due dates with respect to certain taxpayer and government acts. Specifically, for certain time-sensitive actions due to be performed on or after April 1, 2020 and before July 15, 2020.

(1) 180-Day Investment Requirement for Qualified Opportunity Fund Investors

A taxpayer can elect to defer the recognition of eligible gain from the sale or exchange of property with an unrelated person, by investing the gain to be deferred in a Qualified Opportunity Fund (“QOF”) within a 180-day period, beginning on the date of such sale or exchange. 

Notice 2020-23 postponed to July 15, 2020, any deadline for the 180-day investment requirement that otherwise would have occurred on or after April 1, 2020 and before July 15, 2020. 

Notice 2020-39 postpones to December 31, 2020, any deadline for the 180-day investment requirement that otherwise would have occurred on or after April 1, 2020 and before December 31, 2020. 

(2) 90-Percent Investment Standard for Qualified Opportunity Funds

A Qualified Opportunity Fund (“QOF”) is required to hold at least 90 percent of its assets in QOZ property, determined by the average of the percentage of QOZ property held by the QOF on (i) the last day of the first 6-month period of the taxable year of the QOF, and (ii) on the last day of the taxable year of the QOF. This is referred to as the 90-percent investment standard. A penalty can be imposed for each month in which the QOF fails to meet this standard unless it is shown that such failure is due to reasonable cause.

If the last day of the first 6-month period of the taxable year or the last day of the taxable year falls within the period beginning on April 1, 2020, and ending on December 31, 2020, any failure to satisfy the 90-percent investment standard for that taxable year of the QOF is granted reasonable cause for such failure.   

(3) Working Capital Safe Harbor for Qualified Opportunity Zone Businesses

A QOZ business is required to meet a 5-percent nonqualified financial property test on each semi-annual testing date. Under this test, less than 5-percent of the average of the aggregate unadjusted bases of the entity’s property may be attributable to nonqualified financial property.  The working capital safe harbor (“WCSF”) excludes reasonable amounts of working capital that are held in cash, cash equivalents, or debt instruments with a term of 18 months or less. 

Under the WCSH, there must be a written schedule consistent with the ordinary start-up of a trade or business for the expenditure of the working capital assets within 31 months of receipt by the business. The 31-month period can be extended to a 62-month period under certain conditions.

All QOZ businesses holding working capital assets intended to be covered by the WCSH before December 31, 2020, receive up to an additional 24 months to expend the working capital assets provided the requirements for the WCSH are otherwise met.   

(4) 30-Month Substantial Improvement Period for Qualified Opportunity Funds

The original use of post-2017 acquired tangible property in the QOZ must begin with the QOF or QOZ business, or the QOF or QOZ business must substantially improve that property during any 30-month period beginning after the date of acquisition. Property is substantially improved when additions to basis with respect to such property in aggregate, exceed the adjusted basis of that property as of the beginning of that 30-month period.

The 30-month period is tolled for the period beginning on April 1, 2020, and ending on December 31, 2020.

(5) 12-Month Reinvestment Period for Qualified Opportunity Funds

For purposes of the 90-percent investment standard, a QOF has a 12-month period in which to reinvest proceeds received from the sale or other disposition of QOZ property, or a return of capital distribution from QOZ stock held by the QOF. This treatment is available to a QOF only to the extent that, prior to reinvestment in QOZ property, the reinvestment proceeds are continuously held in cash, cash equivalents, or debt instruments with a term of 18 months or less.

If the reinvestment period includes January 20, 2020, then the QOF receives up to an additional 12 months to reinvest the proceeds, provided the other conditions are met.  

Qualified Opportunity Zone Assistance and Guidance from Freed Maxick

The Freed Maxick COVID-19 Resource Center has a wealth of information and guidance on a wide range of topics related to tax relief and benefits, regulatory relief and benefits, and business continuity in the era of COVID-19. Click on the button to explore insights, observations and updates.

If you need additional opportunity zone guidance, we are available to discuss your issues and concerns. Connect with us here or call Freed Maxick at 716.847.2651.

Please keep in mind that due to the quickly-changing nature of the COVID-19 pandemic, you should always discuss changes with your Freed Maxick advisor or legal counsel.

SBA Issues EZ PPP Application and Updated Guidance | Freed Maxick

The U.S. Small Business Administration (SBA), in consultation with Treasury, recently released a revised loan forgiveness application for the Paycheck Protection Program (PPP), along with unveiling a new EZ application…

PPP Application

The U.S. Small Business Administration (SBA), in consultation with Treasury, recently released a revised loan forgiveness application for the Paycheck Protection Program (PPP), along with unveiling a new EZ application for forgiveness of PPP loans.

In addition, the SBA also issued a new interim final rule providing guidance on how to calculate employee and owner compensation for loan forgiveness in the new 24-week covered period created by the Paycheck Protection Flexibility Act.

Some of the main changes in the act include an expansion of the “covered period” for loan forgiveness to 24 weeks from eight weeks, a reduction of the proportion of proceeds that must be spent on payroll costs to 60% from 75%, and the establishment of a safe harbor for businesses that have been unable to return to the level of business activity they had before the COVID-19 pandemic due to compliance with health and safety guidelines for slowing the spread of the virus.

Application highlights

The revised PPP Loan Forgiveness Application and instructions include a number of notable items. Among them are:

  • Health insurance costs for S corporation owners cannot be included when calculating payroll costs; however, retirement costs for S corporation owners are eligible costs.
  • Safe harbors for excluding salary and hourly wage reductions and reductions in the number of employees (full-time equivalents) from loan forgiveness reductions can be applied as of the date the loan forgiveness application is submitted. That means that borrowers don’t have to wait until Dec. 31 to apply for forgiveness using the safe harbors.
  • Borrowers that received loans before June 5 can choose between using the original eight-week covered period or the new 24-week covered period.

New EZ application

The EZ PPP Loan Forgiveness Application requires fewer calculations and less documentation than the full application. The EZ application can be used by borrowers that:

  • Are self-employed and have no employees;
  • Did not reduce the salaries or wages of their employees by more than 25% and did not reduce the number or hours of their employees; or
  • Experienced reductions in business activity as a result of health directives related to COVID-19 and did not reduce the salaries or wages of their employees by more than 25%.

New interim final rule

The SBA issued new rules for determining payroll costs and owner compensation in calculating PPP loan forgiveness under the new 24-week covered period.

The PPP allows loan forgiveness for payroll costs for up to $100,000 annualized per employee, or $15,385 per individual over the eight-week period. Under the new interim final rule, the 24-week maximum established for full loan forgiveness is $46,154 per individual.

Owner compensation calculations

While the employee compensation limit for the 24-week period is three times the eight-week limit, the interim final rule does not do the same with the owner compensation replacement for businesses that file Schedule C, Profit or Loss From Business, or Schedule F, Profit or Loss From Farming, tax returns. For those businesses, forgiveness for the owner compensation replacement is calculated for the eight-week period as 8 ÷ 52 × 2019 net profit, up to a maximum of $15,385. For the 24-week period, the forgiveness calculation is limited to 2.5 months’ worth (2.5 ÷ 12) of 2019 net profit, up to $20,833.  The owner compensation replacement calculations are structured this way in order to prevent owners from benefiting from the PPP in ways that Congress did not intend, according to the interim final rule.

Additional highlights

The interim final rule also modifies earlier guidance to account for changes included in the Payroll Protection Flexibility Act.

  • The minimum term for PPP loans is raised to five years for all loans made on or after June 5. For loans made before June 5, the two-year minimum maturity remains in effect unless both the borrower and the lender agree to extend it to five years.
  • The proportion of PPP funding that must be used on payroll costs to qualify for full forgiveness drops to 60% from 75%.
  • The application deadline for PPP loans remains June 30.

The applications and instructions previously discussed are available in the links below:

Assistance and Guidance from Freed Maxick

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The Freed Maxick COVID-19 Resource Center has a wealth of information and guidance on a wide range of topics related to tax relief and benefits, regulatory relief and benefits, and business continuity in the era of COVID-19. Click on the button to explore insights, observations and updates.

If you wish additional guidance, we are available to discuss your issues and concerns. Connect with us here or call Freed Maxick at 716.847.2651.

Please keep in mind that due to the quickly-changing nature of the COVID-19 pandemic, you should always discuss changes with your Freed Maxick advisor or legal counsel.

 

Main Street Lending Program Proposed Expansion for Nonprofits | Freed Maxick

Overview On Monday, June 15th, the Federal Reserve issued a press release announcing that it will be seeking public feedback on the proposed expansion of the Main Street Lending Program…

Fed Reserve

Overview

On Monday, June 15th, the Federal Reserve issued a press release announcing that it will be seeking public feedback on the proposed expansion of the Main Street Lending Program to nonprofit organizations. The proposed expansion would provide loans to small and medium-sized nonprofit organizations that were in good financial condition prior to the coronavirus pandemic. As part of the press release, the Federal Reserve released a summary of the proposed terms of the loan options, as well as first drafts of term sheets for public consultation.  The period to submit feedback to the Federal Reserve runs through Monday, June 22nd

Eligibility Requirements

Based on the initial guidance released this week, nonprofit organizations that were established prior to, and have been in continuous operation since, January 1, 2015, and were created or are organized in the United States with significant operations in the United States, are eligible. The nonprofit organization would also need to meet one of the following two conditions to be eligible: (a) has 15,000 employees or fewer, or (b) had 2019 annual revenues of $5 billion or less. The nonprofit organization must also have a minimum of 50 employees and an endowment of less than $3 billion. Financial eligibility requirements indicating the nonprofit organization was in good financial condition prior to the coronavirus pandemic include the following: (a) 2019 revenues from donations that are less than 30% of total 2019 revenues, (b) a ratio of adjusted 2019 earnings before interest, depreciation, and amortization to unrestricted 2019 operating revenue that is greater than or equal to 5%, (c) a ratio (expressed as a number of days) of (i) liquid assets at the time of loan origination to (ii) average daily expenses over the previous year, equal to or greater than 90 days, and (d) at the time of loan origination, has a ration of (i) unrestricted cash and investments to (ii) existing outstanding and undrawn available debt, plus the amount of any loan under the facility, plus the amount of any CMS Accelerated and Advance Payments, that is greater than 65%.

Summary of Proposed Loan Options & Terms

Many of the loan terms under the proposed Main Street Lending Program nonprofit loan program are consistent with the terms of the loans offered under the Main Street Lending Program business loans. The table below, extracted from the Federal Reserve press release, summarizes the proposed loan options under the nonprofit loan program.

Market Lending Chart

Conclusion

This week’s press release from the Federal Reserve is good news for nonprofit organizations that were in sound financial condition prior to the coronavirus pandemic and that would benefit from additional liquidity. While the Federal Reserve has provided proposed eligibility requirements and loan terms, it is expected that the eligibility requirements and loan terms will be revised following the public feedback period, as was the case with the existing Main Street Lending Program, which saw substantial changes to the program following the public feedback period.

Assistance and Guidance from Freed Maxick

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The Freed Maxick COVID-19 Resource Center has a wealth of information and guidance on a wide range of topics related to tax relief and benefits, regulatory relief and benefits, and business continuity in the era of COVID-19. Click on the button to explore insights, observations and updates.

If you wish additional guidance, we are available to discuss your issues and concerns. Connect with us here or call Freed Maxick at 716.847.2651.

Please keep in mind that due to the quickly-changing nature of the COVID-19 pandemic, you should always discuss changes with your Freed Maxick advisor or legal counsel.

 

Reopening Western New York – Webinar Series (Part 2) | Freed Maxick

In the second of a four-part series, the professionals of Bond, Schoeneck & King and Freed Maxick discuss the practical challenges being faced by employers as the reopening process continues…

In the second of a four-part series, the professionals of Bond, Schoeneck & King and Freed Maxick discuss the practical challenges being faced by employers as the reopening process continues in Western New York.

Now that our region is in the middle of Phase Two, what have employers learned and how can they prepare for what’s ahead? Also, what should employers keep in mind as the rules governing forgiveness of loans under the Paycheck Protection Program continue to evolve?

 

[youtube https://www.youtube.com/watch?v=L_me4ALIVAc]

 

Freed Maxick Audit Directors Christopher Eckert and Ryan Caster discuss:

Payroll Protection Program Flexibility Act and Key Revisions to the PPP

  • Extension of covered period
  • Thresholds for payroll costs spent and possible “cliff” on forgiveness
  • Extension of loan terms for unforgiven amounts
  • Changes to rehire dates for FTE measurement

Main Street Lending Program Overview

  • Who is eligible to participate?
  • Lending options available
  • Certifications and covenants required
  • How to apply/timing of program

Bond attorneys Jay Organek and Riane Lafferty focus on:

Managing the Returning Workforce

  • Update on the state’s reopening guidance
  • Common issues for employers
  • Frequently asked questions

Assistance and Guidance from Freed Maxick

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The Freed Maxick COVID-19 Resource Center has a wealth of information and guidance on a wide range of topics related to tax relief and benefits, regulatory relief and benefits, and business continuity in the era of COVID-19. Click on the button to explore insights, observations and updates.

If you wish additional guidance, we are available to discuss your issues and concerns. Connect with us here or call Freed Maxick at 716.847.2651.

Please keep in mind that due to the quickly-changing nature of the COVID-19 pandemic, you should always discuss changes with your Freed Maxick advisor or legal counsel.

Paycheck Protection Program Flexibility Act Update | Freed Maxick

Although the PPPFA was just signed by the President last Friday, there have been a few important developments the last few days to bring to your attention: The Treasury and…

PPP Update1

Although the PPPFA was just signed by the President last Friday, there have been a few important developments the last few days to bring to your attention:

  • The Treasury and SBA now says that additional guidance and a modified forgiveness application will be forthcoming “promptly.”  Additionally, Treasury Secretary Mnuchin has stated that although the newly adopted 60% payroll threshold necessity for forgiveness, as written creates a “cliff” and would potentially not provide for partial forgiveness if payroll spending is less than 60%; the intent is that businesses will be provided with partial forgiveness.  As recently as yesterday, Secretary Mnuchin has signaled to Congress that both Treasury and the President are open to additional PPP modifications.
  • In light of the above commentary, Congress is working on a PPP technical corrections bill which is expected to, at a minimum, address and fix the “cliff” issue mentioned above, as well inclusion of PPE type expenses (masks, protective gear, etc.) that employers have incurred under the eligible expenses currently allowed to be used with PPP funds.
  • In our opinion, the biggest news with respect to PPP that we’ve recently learned is that there is bipartisan  legislation being worked on in the Senate that would clarify that the receipt and forgiveness of a PPP loan will not affect the tax treatment of ordinary business expenses, otherwise, allowing those items to be deductible. 

Thus far, our most accurate commentary is that every piece of PPP legislation, interim rules and/or guidance, continues to develop and for every one of these instances, additional questions are then generated, most of the time without definite answers.

Assistance and Guidance from Freed Maxick

The Freed Maxick COVID-19 Resource Center has a wealth of information and guidance on a wide range of topics related to tax relief and benefits, regulatory relief and benefits, and business continuity in the era of COVID-19. Click on the button to explore insights, observations and updates.

If you wish additional guidance, we are available to discuss your issues and concerns. Connect with us here or call Freed Maxick at 716.847.2651.

Please keep in mind that due to the quickly-changing nature of the COVID-19 pandemic, you should always discuss changes with your Freed Maxick advisor or legal counsel.

Paycheck Protection Program Flexibility Act – Update

The President recently signed the Paycheck Protection Program Flexibility Act (PPPFA) -the following is a summary of the highlights of the legislation: Extends 8 week “covered period” to 24 weeks…

PPP Loan Update

The President recently signed the Paycheck Protection Program Flexibility Act (PPPFA) -the following is a summary of the highlights of the legislation:

  • Extends 8 week “covered period” to 24 weeks or December 31, 2020 ( whichever comes first).  This will help businesses that were unable to open or had restrictions during government mandated shutdowns.  This should more than likely assist businesses with being successful receiving loan forgiveness, as the loan amount was only based on a 2.5 month multiple of payroll.  Additionally, the PPPFA allows businesses to elect to apply for forgiveness at the original 8 week period as well.
  • Reduces the current threshold of required use on payroll from 75% to 60% for maximum forgiveness, thereby increasing nonpayroll expenses, such as rent, mortgage interest and utilities, from 25% to 40% of the total loan proceeds spent.  However, the law did not modify the eligible items (payroll, rent/mortgage, utilities and qualified loan interest) as anticipated to include PPE costs.  It is thought that businesses will continue to lobby Congress to expand these items.
  • Extend loan term on unforgiven amounts from 2 years to 5 years at a 1% interest rate.  Your lender has 60 days after you apply to make forgiveness determination, and the SBA has an additional 90 days from then to grant or not.  Your first payment is deferred until six months after the SBA makes their 90 day determination. 
  • Allow small businesses to take a PPP loan and also qualify for a separate, recently enacted tax credit to defer payroll taxes, currently prohibited to prevent “double dipping.”  Although it is highly recommended that you consult with your labor counsel to determine any unintended consequences of payroll tax deferral and ultimate liability/responsibility.
  • Extends the rehire date of employees from June 30, 2020 to December 31, 2020.  The PPPFA also makes and additional modification for businesses with an exception for having a reduced head count.  The PPPFA states that a business may still be granted forgiveness if:
    • Is able to demonstrate an inability to return to the same level of business activity as such business was operating at prior to February 15, 2020, or
    • Is unable to rehire an individual who was an employee of the eligible recipient on or before February 15, 2020;
    • Is able to demonstrate an inability to hire similarly qualified employees on or before December 31, 2020

 

And they have defined the term, “demonstrate the inability to rehire or return to the same level of business activity” as – well you didn’t really think they would give that to us yet do you?  They haven’t, other than additional guidance will be forthcoming.

Additional guidance that would also be helpful and necessary would be clarification for:

  • Currently as written there are concerns that businesses will not be allowed partial forgiveness if they spend less than the 60% of loan on payroll.  Senators Rubio and Collins have indicated they will seek a technical correction to the legislation however they viewed the urgency of the passing of this legislation and getting it to the President for signature, of greater importance.
  • Employees who annual salary is in excess of $100,000 is still limited to 8/52 or $15,385 or will it be updated to reflect 24/52 or $46,154.  The current understanding is that the PPPFA does not include an adjustment to 24/52 from the 8/52 limitations.  This issue may no longer be significant as with the period being extend, it may in many cases make this point moot.
  • Clarity with respect to potentially forgivable amounts for  health insurance costs and employer retirement contributions and if they are limited to 8/52, 24/52, or some other limitation or threshold.

 

New Federal and New York State Tax Benefits

Understanding the tax policy response to COVID-19

Tax relief policies at the federal, state and international levels are taking shape to help businesses recover from COVID-19 disruptions. Our COVID-19 Tax and Regulatory Relief resource center features the the most current information and analysis from our professionals, with the goal of addressing your immediate needs. From cash flow challenges to ensuring your employees are taken care of, Freed Maxick has provided these resources to help your business develop its response to the environment created by the coronavirus pandemic.

Families First Coronavirus Response Act

The Families First Coronavirus Response Act (the Act) was signed into law late on March 18, 2020, soon after the Senate passed the amended House bill sent to the Senate on March 17, 2020.

Families First Coronavirus Response Act Q&A

As provided under the legislation, the U.S. Department of Labor will be issuing implementing regulations. Additionally, as warranted, the Department will continue to provide compliance assistance to employers and employees on their responsibilities and rights under the FFCRA.

CARES Act – Coronavirus Stimulus Bill

On March 27, 2020, the President signed the Coronavirus Aid, Relief and Economic Security Act (CARES Act) into law. The CARES Act is a massive $2 trillion bill with an array of significant tax-saving provisions that impact both individuals and businesses and hopefully create needed cash flow. The CARES Act also could affect prior tax years.

CARES Act Provides Technical Amendment to Qualified Improvement Property

The 2017 Tax Cuts and Jobs Act (“TCJA”) amended IRC section 168(k) to eliminate qualified improvement property (“QIP”) as a specific category of qualified property eligible for additional first-year depreciation known as “bonus depreciation."

Use of Retirement Funds Under the CARES Act

Section 2103, Special Rules for Use of Retirement Funds of the “Coronavirus Aid, Relief, and Economic Security Act” or the “CARES Act” allows tax favored withdrawals from retirement plans and changes to loan provisions for those individuals directly impacted by COVID-19. Whether you are a Plan Administrator or a participant in a retirement plan it is important to understand these benefits.

The CARES Act: Elections Under Business Interest Limitation Rules Amended By IRS

On March 27, 2020, President Trump signed the Coronavirus Aid, Relief, and Economic Security “CARES” Act into law. The $2 trillion CARES Act contains an array of tax provisions designed to increase deductions that are available to businesses, and by doing so, generate cash flow during the coronavirus (COVID-19) crisis.

CARES Act: IRS Issues Guidance on Deferral of Employer Social Security Taxes

The recently enacted $2 trillion Coronavirus Aid, Relief, and Economic Security Act (CARES Act) contains a provision which allows employers to defer the deposit and payment of the employer’s share of Social Security taxes, as well as certain railroad retirement taxes. Now, the IRS has issued additional guidance clarifying this.

CARES Act Provides Added Value to Net Operating Losses (NOLs)

By now we have all heard about the various stimulus and relief packages deployed by the government aimed at providing economic and fiscal relief to businesses of all sizes as well as individuals facing hardships during this challenging time. Included in the CARES Act were several income tax provisions aimed at providing liquidity and relief, specifically the provisions regarding net operating losses (NOLs).

New Federal and New York State Business Relief Programs

Understanding your options

On March 27, 2020, the President signed the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), a $2 trillion stimulus package thought to be the largest in U.S. history.  The CARES Act expands or establishes multiple loan programs for qualifying businesses, including the new SBA Paycheck Protection Program, the expansion of the Small Business Administration (SBA)’s existing Economic Injury Disaster Loans (EIDL) program and an additional program focused on mid-size businesses with 500-10,000 employees backed by $500 billion from the US Department of the Treasury’s Exchange Stabilization Fund to make loans, loan guarantees and other investments to provide liquidity to eligible businesses, states and municipalities.

Paycheck Protection Program

Click the link below to see all Freed Maxick content and insight related to the Paycheck Protection Program.

SBA Disaster Loan Program

In an effort to minimize economic impacts on small businesses resulting from the COVID-19 (coronavirus) pandemic, the Small Business Administration (SBA) is providing Economic Injury Disaster Loans (EIDLs) to small businesses in designated states and territories.

Federal Government Expands Access to Loans for Small and Midsize Businesses Under Title IV of the CARES Act

Under certain conditions and with appropriate certifications, your business may be eligible under the CARES Act to receive a loan through the federal government to help you through the Covid-19 crisis. Although funds under the Main Street Business Lending Program have not yet been distributed, guidance for borrowers has been issued in preparation for the funding flow to be initiated.

Unemployment Insurance Benefits in NYS Under the CARES Act

In response to the Coronavirus Pandemic, on March 27, 2020, President Trump signed the Coronavirus Aid, Relief and Economic Security (CARES) Act, a $2 trillion stimulus bill. The Relief for Workers Affected by Coronavirus Act – which is the unemployment insurance (UI) portion of the Act – provides enriched unemployment benefits to eligible claimants.

Federal Reserve Announces an Expansion of Scope and Eligibility of the Main Street Lending Program

On April 9th, the Federal Reserve provided details regarding actions they were taking to support small and mid-sized businesses impacted by the coronavirus pandemic. One of these programs was the Main Street Lending Program (MSLP or the Program).

FASB Provides Guidance on COVID-19 Related Lease Concessions

With the uncertainties surrounding the COVID-19 pandemic, the Financial Accounting Standards Board (FASB) has received several questions from stakeholders about the application of Topics 840 and 842, Leases. Specifically, the inquiries pertain to the accounting and disclosure of new lease concessions in previously executed contracts, as a result of the pandemic.

Regulation Compliance Reliefs

What you need to know

COVID-19 is presenting challenges for many companies. To address these challenges, many regulators/agencies have issued orders, releases and statements which allow, subject to certain conditions, companies to take advantage of any applicable relief. Companies need to ensure they meet all applicable criteria and are in compliance with the requirements.  Companies also need to consider matters related to financial reporting.  Freed Maxick has provided the resources below help you address these concerns.

April 15, 2020 Due Date Information

The 2019 income tax filing and payment deadlines for all taxpayers who file and pay their Federal income taxes on April 15, 2020, are automatically extended until July 15, 2020. This relief applies to all individual returns, trusts, and corporations. This relief is automatic, taxpayers do not need to file any additional forms or call the IRS to qualify.

Financial Statement Considerations

The effects of the coronavirus are evolving rapidly (hour-by-hour, day-by-day) and are unique for each entity's circumstances. The following is a high-level overview of a few matters related to financial reporting for consideration during this critical time.

New York State Tax Extension Update

New York has extended the April 15 due date to July 15, 2020, for personal income tax and corporation tax returns originally due April 15, 2020, due to the coronavirus pandemic. The extension applies to returns for individuals, fiduciaries, and corporations. In addition, taxpayers are allowed to defer all related tax payments due on April 15, 2020, to July 15, 2020, without penalties and interest, regardless of the amount owed.

Regulators and Agencies Extend Much-Needed Regulatory Relief to Businesses

COVID-19 is presenting challenges for many companies. To address these challenges, many regulators/agencies have issued orders, releases and statements which allow, subject to certain conditions, companies to take advantage of any applicable relief. Companies need to ensure they meet all applicable criteria and are in compliance with the requirements outlined below, as in many cases, extensions are not automatic.

IRS Extends More Tax Deadlines

To help taxpayers, the Department of Treasury and the Internal Revenue Service announced today that Notice 2020-23 extends additional key tax deadlines for individuals and businesses.

FASB Proposes Lease Standard Deferral

On April 8, 2020, the FASB issued a proposal to defer the effective date for ASU 2016-02, Leases, and its subsequent amendments. For private companies and private not-for-profits, the standard would be effective for fiscal years beginning after December 15, 2021. For public not-for-profits (i.e. those that have issued, or are conduit bond obligors for, public debt) the standard would be effective for fiscal years beginning after December 15, 2019, so long as the entity has not yet issued financial statements.

Industry Updates

Industry specific direction and guidance

Financial Institutions

Click the link below to find Financial Institutions related COVID content.

Healthcare

Click the link below to find Healthcare related COVID content.

Higher Education

Click the link below to find Higher Education related COVID content.

Non-Profit

Click the link below to find Non-Profit related COVID content.

Real Estate

Click the link below to find Real Estate related COVID content.

Business Continuity in the COVID-19 Environment

Business Continuity in the COVID-19 Environment

To ensure business continuity it is important to react quickly to mitigate impacts and other risks and to prepare the organization for the further disruptions related to the COVID-19 Pandemic. Managing business continuity includes concerns around infrastructure, cybersecurity, remote employees, business, operational and communication risks, with the aim of managing an organization through new challenges and risks while maintaining continuity of operations and production.

Notification of Enforcement Discretion for Telehealth Remote Communications During the COVID-19 Nationwide Public Health Emergency

On March 17, 2020, the Office for Civil Rights (OCR) announced the “Notification of Enforcement Discretion for Telehealth Remote Communications During the COVID-19 Nationwide Public Health Emergency.” This notification provided guidance on the use of video conferencing technologies to provide telehealth services to a health care providers patients, and communicates the OCR’s official stance on the issue as the country continues to address the COVID-19 pandemic.

Why is Privileged Access Management Important for Your Organization?

With evolving and steadily increasing cyber-attacks, many organizations are not taking steps to stop the abuse of privileged credentials. A recent survey from Centrify, a privileged access management (PAM) company, suggested that of the 1,000 IT decision makers surveyed in the U.S. and U.K., 74% of breaches involved access to a privileged account.

Adapting to a Remote Work Environment

For much of the workforce, life has changed drastically over the past few weeks. The combination of school closings and mandatory work from home orders can have a significant impact on your ability to stay focused and productive. We have put together some suggestions to help you adjust to your new normal. Ultimately, we are all a bit different and you have to find what works best for you, but here are a few suggestions to get you started.