Mar 26, 2020.
Business-Related Highlights:
“Forgivable” bridge loans to small business.
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“Small Business” is defined for this program as having fewer than 500 employees. Certain larger employers can also qualify.
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MAY be problematic to PE/VC-owned companies as historically SBA (who will administer program) has looked at portfolio of companies as one company.
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Must be “substantially affected” by COVID-19. This includes loss of sales or customers.
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Can apply between Mar 1 and Dec 31. (“covered period”)
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Max loan amount = lesser of $10M -or- 4 times average monthly (payroll + mortgage pymnts + rent + other debt) over last year. Translation: up to $10M.
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Forgiveness provision only relates to the costs of maintaining payroll between Mar 1 and June 30. Loan forgiveness is reduced by a percentage if average FTE is lower than same period in 2019.
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Limitations on use – salaries, mortgage, rent, utilities, debt obligations incurred PRIOR to covered period.
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Separate provisions related to women-owned and minority-owned businesses.
– Q1, Q2 2020 c-corp estimated tax payments. Delayed from April 15/June 15 to Oct 15.
– Employer payroll tax deferral. Employer portion only (7.65%). Payment of amounts due for payrolls between date of enactment and Dec 31 2020, can be deferred 50% until Dec 31, 2021, 50% until Dec 31, 2022.
– Required paid leave. Offset by a credit for wages paid for employees on leave.
– BIG business. Emergency loans to certain “distressed” business; mainly air carriers. Suspension of aviation excise taxes.
Other Highlights:
– The $1,200 check. Up to $1,200 per person, $2,400 for joint filers. $500 for each qualifying child (dependant). Phase out happens at $75K of AGI ($150K MFJ). Income determined by 2019 tax filing, or 2018 if not filed. “Checks” (or DD if info on file with IRS) will go out 3 weeks from enacting.
– A bunch of healthcare-related stuff. Funding for treatment of COVID-19, adjustments to healthcare insurance coverage, accelerated FDA approval, etc
– Education. Payments on federal student loans suspended. Adjustments to grants and other aid.
– Unemployment. Benefits extended to self employed and people with limited work histories.
– Individual tax. Filing and payment delay for 2019, and Q1 2020 estimated, from April 15 to July 15. Withdrawals from tax-favored retirement plans allowed without penalty, subject to limitations. Charitable contributions: non-itemizers can take an “above the line” (income adjustment) for CCs.