March-April COVID Related Relief Updates For Business Owners and Tax Filers
There are many updates related to PPP, EIDL, State & Federal Filing, and it's hard to keep up, so we're bringing you a summary of updates for March and April. We will be updating the information in this article as we learn more details, so please bookmark the page.
Latest Update 4/7/21 9:00 AM. Recent updates are highlighted below.
For a summary of the American Rescue Plan Act (ARPA), read this article.
EIDL Loans - Increase
- The SBA increased the maximum loan amount from $150,000 to $500,000. Read all the details here
- The loan terms will remain the same; 30-year term with a 3.75% fixed rate for business and 2.75% for nonprofits
- Businesses that have already received a loan do not need to submit a request for an increase. The SBA will contact borrowers directly via email with details about how they can request an increase
- Any applications that are currently being processed or new applications will automatically be considered for loans covering up to 24 months of economic injury up to $500,000
- The SBA announced on March 12 that deferment periods for all EIDL loans would be extended until next year. The first payment due date for loans made in 2020 will be 24 months from the date of the note. For loans made in calendar year 2021, the first payment is due 18 months from the date of the note
PPP - Application Deadline to be Extended
- The Senate passed the PPP extension sending it to President Biden to sign. The bill would delay the PPP application deadline from March 31 to May 31. The agreement would also let the SBA process pending loan applications for 30 days after the deadline
- The ARPA funded the PPP with another $7 billion, but the SBA is now saying that they expect it will only have funds available to lend through mid-to late-April
- Based on the above, If you believe that you're eligible to apply for the PPP and haven't applied yet, please reach out to your senior accountant so they can assist you with this
The Tax Season is Being Extended By One Month
- The individual 2020 tax return filing deadline has been extended by one month to May 17, 2021
- Our office will be closed on May 17 due to the holiday of Shovues, so the last day of tax return submission will be on May 14
- This is an automatic extension, so no action is required from taxpayers
- The extension also delays the deadline to pay the 2020 tax balance
- C-Corporation (1120) deadline has not been changed. The deadline remains April 15
- The IRS did not extend the April 15 deadline for first quarter 2021 estimated taxes
- The extension is also valid for IRA and HSA contributions
- State filing and payment deadlines vary and are not always the same as the federal filing deadline you can check state filing deadlines here
- Any individual whose statute of limitations to file a claim for refund was set to expire on April 15 (2017 returns) will now have until May 17 to get it done
What happens if you failed to claim or incorrectly claimed your Stimulus Credit on your Tax Return?
- Individuals who failed to claim ANY credit at all on the 2020 return but were entitled to them must file an amended return on Form 1040-X in order to receive the benefit
- However, if you claimed a credit on the original return, even if it was the incorrect amount, you should NOT file an amended return; the IRS will correct the amount for you
- Read the IRS FAQ on this here
If you have any questions that we didn't address, please let us know by posting in the comments section so we can assist.