How to get immediate tax relief due to the coronavirus COVID-19
Tax Filing and Payment Deadline Extension
The usual filing and payment deadline of April 15th has been postponed to July 15th for 2020. “All taxpayers and businesses will have this additional time to file and make payments without interest or penalties. “ – Treasury Department Secretary Steven Mnuchin
Employee Retention Credit
The Employee Retention Credit is a refundable tax credit against certain employment taxes equal to 50% of the qualified wages an eligible employer pays to employees after March 12, 2020, and before January 1, 2021. You may claim this credit if your business has received a significant loss in sales due to the coronavirus (you are making less than 50% of your gross sales for the same quarter in 2019). It is claimed for most employers beginning with the second quarter in 2020, but eligible employers may immediately begin reducing their tax deposits in anticipation of this credit, and may also request an advance on the credit for any amounts not covered by the reduction in deposits. The refundable credit is capped at $5,000 per employee.
Sick and Family Leave
The Families First Coronavirus Response Act gives all American businesses with fewer than 500 employees funds to provide employees with paid leave, either for the employee’s own health needs or to care for family members.
Employees who are unable to work due to COVID-19 either because they are sick or because they are caring for someone else who is sick are entitled to a certain amount of paid sick leave.
Eligible employers are entitled to receive a credit in the full amount of the required sick leave and family leave, plus related health plan expenses and the employer’s share of Medicare tax on the leave, for the period of April 1, 2020, through December 31, 2020. The refundable credit is applied against certain employment taxes on wages paid to all employees.
Receiving an Advance Payment
Use Form 7200 to request an advance payment for the tax credits that you will be eligible to claim on your next 941 or 944.
For more information visit: https://www.irs.gov/coronavirus/new-employer-tax-credits
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