Category Archives: Alerts

Wisconsin Small Business Recovery Grants

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The Wisconsin Tomorrow Small Business Recovery Grants, funded by the American Rescue Plan Act of 2021 (ARPA), started taking applications yesterday, May 24th, 2021, from businesses affected by the COVID-19 pandemic. The award amount will be $5,000 per business as long as their annual gross revenue is between $10,000 and $7 million. The application deadline is June 7th, 2021 at 4:30 pm.

Application Link – My Tax Account (wi.gov)

FAQs Link – DOR Wisconsin Tomorrow Small Business Recovery Grant

PPP Loan Round 2 Opens January 11

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PPP Loan Availability
Last Friday the SBA and Treasury announced that the second round of the Paycheck Protection Program (PPP) opens today, January 11, 2021, and on Wednesday, January 13, 2021. The exclusive two-day window, on the 11th and 12th of January, is reserved for first-draw PPP loans by community financial institutions that serve minority- and women-owned businesses. Then on the 13th, second draw PPP loans by the same community financial institutions stated above will be available. Shortly after the 13th all participating lenders will have the ability to transmit PPP loans for their clients – there has not been a specified date for when this will occur. There will be $284.5 billion available for these PPP loans, including $35 billion for first-time loans.

Deadline for Applications
March 31, 2021

Calculation of Loan Amount

  • First and Second-Time Borrowers
    • Can receive up to 2.5 times their average monthly payroll costs (with a cap per employee of $100,000 annualized) in 2019, 2020, or the year prior to the loan
  • PPP Loan Borrowers with NAICS codes starting with 72 (such as hotels and restaurants)
    • Can receive up to 3.5 times their average monthly payroll costs (with a cap per employee of $100,000 annualized) in 2019, 2020, or the year prior to the loan


New Qualified Businesses and Expenditures

  • Businesses
    • Nonprofits including churches
    • Sec. 501(c)(6) business leagues – other restrictions apply
    • News organizations – other restrictions apply
    • Publicly traded companies with certain ownership
  • Expenditures
    • Protective supplies, equipment and modification costs to comply with COVID-19 guidelines
    • Property damage related to vandalism or looting that was not covered by insurance or other compensation
    • Essential expenditures to suppliers to maintain current operations
    • Covered operating expenditures
      • Payments for business software or cloud computing service that is used for business operations
      • Product or service delivery
      • Processing, payment, or tracking of payroll expenses
      • Human resources
      • Sales and billing functions
      • Accounting
      • Tracking of supplies, inventory, records and expenses

Qualifications for First-Draw Applicants (up to $10 million)

  • Operation
    • In operation prior to February 15, 2020
  • Employee Count
    • 500 or fewer employees
  • Employee Count (food services operations)
    • 500 or fewer employees per location

New Qualifications for Second-Draw Applicants (up to $2 million)

  • Revenue Reduction Test
    • Previously a business only had to certify that they had economic uncertainty in order to qualify for the first round of PPP loans. In the second round, businesses, that are requesting a second PPP loan, must prove they have been impacted by showing they have faced at least a 25% reduction in revenue in a quarter compared to the same quarter from the previous year
  • Employee Count
    • 300 or fewer employees
  • First Round PPP Funds Spent Test
    • The borrower must certify that they have used or will use all of the funds from the first PPP loan before receiving the new funds  

Simplified Forgiveness
Borrowers that receive a PPP loan of $150,000 or less will be able to fill out a simplified, one page, forgiveness application. The SBA has not released this simplified form yet, but they have a deadline of January 20, 2021. When applying for forgiveness, applicants must use at least 60% of the funds for payroll between 8 or 24 weeks.
 
 
Please stay safe and healthy.

Paycheck Protection Program Flexibility Act (PPPFA) has been officially signed

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On June 5th, 2020, the Paycheck Protection Program Flexibility Act (PPPFA) was officially signed which will positively impact businesses and self-employed individuals who have received or will be applying for the Paycheck Protection Program (PPP) Loans. Below will be a list of how the PPPFA enhances the PPP Loans:
 

  • Businesses can continue to defer Social Security taxes through the end of 2020
  • The percentage of the loan that was required to be used for payroll costs was decreased from 75% to 60%
  • The 8-week period to use the funds has been increased to 24 weeks or 12/31/2020 if earlier
  • The deadline for employers to return to prior employment / wage levels has been extended from June 30th, 2020 to December 31st, 2020
  • The period of loan maturity has been increased from 2 years to 5 years
  • Borrowers can now defer payments until the amount of loan forgiveness is determined

 
Businesses that received their funds before the PPPFA are not forced to abide by the regulations provided by the PPPFA, but they can elect to use them. Also, we want to remind business owners who have not received the loan that these loans still need to be applied for before June 30th, 2020 as that date has not been extended. 
 
Please stay safe and healthy.
The Mitz & Rozansky Team

The Cares Act and You

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Due to the recent economic disaster, COVID-19, the government has been working diligently on different plans to help businesses across the country. The two plans that will affect most of our clients at Mitz & Rozansky, SC are The CARES Act and the Families First Coronavirus Response Act. We have conducted extensive research on the two acts and will continue to monitor all activity that is relevant.  We want to assure you that we are doing everything possible to help you through these difficult times. The following narrative summarizes the two acts.

THE CARES ACT

This act was brought about to help provide economic relief through the source of a relievable loan for businesses that are encountering difficult times during this economic disaster. In order to receive this loan, the business must be directly affected, offer services to a directly affected business or be indirectly harmed by losses in their communities. Once qualified, the business will then go through a screening process where it provides a variety of different financial items to determine the maximum loan it qualifies for. The calculation will be the lesser of 2.5 times the average monthly payroll from the year prior to applying for the loan or 10 million dollars. For example, if someone applied for a loan on March 31, 2020 the payroll information needed will be from March 31, 2019 – March 31, 2020. The money can only be used for fixed debts such as mortgage interest and rent, payroll and certain utility payments. The balance used will have a maximum interest rate of 4%, which will be the only payment the employer is responsible for if the funds are used properly and there are no layoffs. If the funds are not used properly there will be a calculation of the portion of the principal balance that will not be forgiven. Unforgiven balances will have to be repaid within 10 years. It will be very important to keep detailed records of the balance and the expenses that were deducted from the balance as the business will need to supply these expenses to verify they are in accordance with the rules. 

We do not know how long these loans will take to process, but they have implemented an emergency grant to provide $10,000 of the loan, immediately.

Other facts – employees with wages over $100,000 do not qualify, personal guarantees are required for loans over $200,000 and there are no costs to apply.

FAMILIES FIRST CORONAVIRUS RESPONSE ACT (FFCRA)

In addition to The Cares Act, the government has also implemented the Families First Coronavirus Response Act (FFCRA) to assist employees with paid leave, who are unable to continue to work due to the effects of COVID-19.  This act does not apply to all businesses. If a Company has less than 50 employees and can prove that the continuation of paid leave would jeopardize the viability of the business as a going concern, it does not need to comply. The FFCRA protects both full time and part time employees who have been employed by the Company for at least 30 days. There are six different ways an employee can qualify for paid leave under this act which will alter how much they are paid, either full wage or 2/3 wage, and how long they will be able to receive those benefits, 80 hours or 480 hours. Part time employees have prorations based on average hours for a two-week period, excluding unusually high or low work weeks. The Company will receive a dollar-for-dollar tax credit for all qualifying wages paid under FFCRA and will also receive tax credits for amounts incurred to maintain health insurance coverage. 

*Proceeds from The Cares Act can’t be used to pay leave under the FFCRA because the Company would be receiving a tax credit for the wages paid without using the Company’s funds. 

Other facts – the first 10 days of leave are unpaid but can be supplemented with accrued PTO, sick leave or vacation days and if an employee’s rate of pay is below minimum wage their hours are required to be raised to minimum wage.

We will help you however we can as you navigate this loan application process. Please call or email if you need help.

Please stay safe and healthy.

Best regards, 

The Mitz & Rozansky Team

Clients and Friends-Beware! IRS Warning – Scam Artists Posing as the IRS

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IRS Warning – Scam Artists Posing as the IRS. Clients and Friends-Beware!

(Taken Directly from the IRS Website – See Link Below)
Please be aware of scam artists posing as IRS personnel on the phone. The IRS has issued an alert that details the types of calls you could receive and what to do about them.

“Callers may demand money or may say you have a refund due and try to trick you into sharing private information. These con artists can sound convincing when they call. They may know a lot about you, and they usually alter the caller ID to make it look like the IRS is calling. They use fake names and bogus IRS identification badge numbers. If you don’t answer, they often leave an “urgent” callback request.

The IRS reminds people that they can know pretty easily when a supposed IRS caller is a fake. Here are five things the scammers often do but the IRS will not do. Any one of these five things is a tell-tale sign of a scam. The IRS will never:
• Call to demand immediate payment, nor will we call about taxes owed without first having mailed you a bill.
• Demand that you pay taxes without giving you the opportunity to question or appeal the amount they say you owe.
• Require you to use a specific payment method for your taxes, such as a prepaid debit card.
• Ask for credit or debit card numbers over the phone.
• Threaten to bring in local police or other law-enforcement groups to have you arrested for not paying.

If you get a phone call from someone claiming to be from the IRS and asking for money, here’s what you should do:
• If you know you owe taxes or think you might owe, call the IRS at 1.800.829.1040. The IRS workers can help you with a payment issue.
• If you know you don’t owe taxes or have no reason to believe that you do, report the incident to the Treasury Inspector General for Tax Administration (TIGTA) at 1.800.366.4484 or at www.tigta.gov.

To read the complete IRS alert go to http://www.irs.gov/ and type “scam” in the search box.”

Please note: It is extremely important that you protect your identity from people attempting to fraudulently file a tax return in your name. If you feel that some has tried to do so contact us immediately at 414-352-3200 for assistance. You should also fill out the IRS Identity Theft Affidavit which can be downloaded by clicking here.

The staff at Mitz & Rozansky is available to discuss any tax related concerns you may have. Give us a call at (414)352-3200.