The Latest Helpful Coronavirus Information
In the last two weeks there has been an unprecedented amount of information and legislation coming out of Washington D.C. and state & local governments. Much of it is financial in nature and meant to help you, whatever your current situation may be. With that in mind, below is a hopefully succinct summary:
The normal April 15, 2020 tax filing and payment deadline has been extended to July 15, 2020.
Estimated first quarter tax payments normally due April 15th have been extended to July 15, 2020. Second quarter estimated payments are still due June 15th!
2019 IRA and HSA contribution deadlines have likewise been extended to July 15, 2020.
A one-time recovery rebate is an advance refundable credit against your 2020 taxes in the amount of $1200 for individuals ($2400 for joint filers) plus an additional $500 per child under age 17 who qualifies for the Child Tax Credit. All U.S. residents with AGI up to $75,000 ($150,000 for joint filers) are eligible. This is true even if you have no income. The credit is phased out for incomes between $75,001 and $99,000 ($150,001 and 198,000 joint filers). You do not need to take any action to receive these funds. They will be direct deposited into the same account you most recently filed a tax payment with. Otherwise a check will be mailed to your last known address. Note: your 2019 AGI will be used. If that is not available, your 2018 AGI will be used. So, for a few people, it may behoove you to wait to file your 2019 return.
The 10% early-withdrawl penalty on retirement plan distributions is waived for COVID-19 related distributions up to $100,000 from qualified retirement plans or IRAs. This income can be included ratably in your tax return over a 3-year period.
RMDs from 401(k)s, 403(b)s, 457(b)s, SEP, SIMPLE, Traditional and Rollover IRAs, and Inherited IRAs are waived for calendar year 2020.
A temporary new unemployment program has been initiated for individuals not traditionally eligible (self-employed, independent contractors, etc.) who are unable to work due to COVID-19.
Payments on federal student loans are suspended until September 30, 2020. Also, no interest will accrue.
Extended paid sick leave, family leave and food assistance programs has been approved.
A $300 "above the line" deduction is available for charitable contributions made to 501(c)(3) organizations for taxpayers who take the standard deduction.
There is a lot here. If anything doesn't make sense, needs clarification, or seems to be omitted, please feel free to e-mail me or call. And, as I mentioned last month, if you're nervous, distraught, scared, etc., let's talk.