MRPR Blog

On Saturday, January 9^th the Treasury and the SBA released new PPP guidance and application forms. The new guidance includes overviews of the First and Second PPP draws and the Revised PPP1-Borrower-Application-Form and Second-Draw-Borrower-Application-Form.

Christmas came early this year! As part of the Consolidated Appropriations Act of 2021, Congress has passed a stimulus package (“COVID-related Tax Relief Act of 2020”) that has provided a variety of useful provisions and clarifications for individual and business taxpayers alike. While not as comprehensive as the CARES Act passed earlier this year, it provides much-needed aid.

Under the Paycheck Protection Program (PPP), borrowers who received a PPP loan in excess of $2 million, whether from a single loan or the combined total (together with affiliates), have known for a while that their loans would receive increased attention from the Small Business Administration (SBA). To that end, the SBA Form 3509 must be submitted for loan amounts of $2 million or greater.

The Michigan Department of Treasury has granted a 31-day waiver for penalty and interest for the late reporting of sales, use, and withholding (SUW) taxes ordinarily due on December 20, 2020. Because of this waiver, any SUW returns and payments for affected businesses can be made without interest or penalty until January 20, 2021.

On November 30th, the MEDC announced that the Michigan Strategic Fund approved the funding of up to $10 million to assist small businesses disproportionately impacted by COVID -19. The “Pure Michigan Small Business Relief Initiative” will utilize Federal CARES Act monies to award up to $15,000 each to Michigan small businesses.

There has been considerable confusion regarding how expenses are to be treated for our clients who have received Paycheck Protection Program (PPP) loans, which are eligible for forgiveness under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act).

The DOL has released additional Q&As, while updating others, in order to provide further guidance and clarification under the FFCRA as it relates to 1) schools back in session, and 2) New York court decisions regarding the Act. Being armed with the latest information will help make planning more productive and conversations more supportive within your organization.

The SBA released an Interim Final Rule for the Paycheck Protection Program (PPP) on August 24^th, 2020. The rule creates forgiveness limitations and/or clarification on limitations in three areas. The full IFR goes into full detail of the treatment of owners and forgiveness of certain non-payroll costs.

Here are the key highlights to help you stay updated.

The Tax Cuts and Jobs Act (TCJA) of 2017 added many new provisions to the tax code. Taxpayers with larger estates initially saw a benefit from the change to the lifetime exclusion for gift and estate taxes. It increased the amount for each taxpayer from $5 million to $11 million, adjusted for inflation. (For 2019, the indexed amount is $11.4 million.) However, tax practitioners saw a catch: after 2025, the provision will sunset and the lifetime exclusion per taxpayer will revert back to $5 million. Worse yet, it was unclear what would happen to taxpayers who gave gifts that make up this extra $5 million provided by the TCJA. Thankfully, the IRS has finalized Regulation 106706-18, which provides more clarity around gifts and estate transfers. Let's take a look at what you should know if you're worried about being taxed for your generosity.