COVID-19 Update November 20, 2020

Earlier this week, the US Treasury Department and IRS released new guidance to clarify the tax treatment of expenses where a Paycheck Protection Program (PPP loan) has not been forgiven by the end of the year the loan was received. The two documents that accompanied this guidance include the Revenue Ruling, and the Revenue Procedure.

Furthermore, in the case where a PPP loan was expected to be forgiven, and it is not, businesses will be able to deduct those expenses. If a business believes that a PPP loan will be forgiven in the future, expenses related to the loan are not deductible, whether the business has filed for forgiveness or not. Therefore, businesses are encouraged to file for forgiveness as soon as possible.

Retirement plans may have several changes with the incoming new administration. President-elect, Joe Biden supports ending upfront tax breaks for contributing to traditional 401(k) plans and replacing them with flat-tax credits. Accordingly, on Monday, the U.S. Department of Labor (DOL) published a final rule explaining how 401(k) service providers can register as a pooled plan provider, which clears the way for PEPs to get underway starting Jan. 1, 2021.

Here at Delta, we are intimately familiar with these types of plans as we have recently introduced a Multi-Employer plan for all of our clients that want to participate. Be wary of the influx of companies that are trying to get a group together to manage a 401k plan. These types of plans have plenty of issues, such as, for example, who would be the fiduciary in case the plan does anything wrong. Please don’t hesitate to reach out if you have any questions or would like to learn more.

Mayor Bill de Blasio has announced that New York City will be closing all public schools, bringing further difficulty onto workers suffering without adequate childcare and onto the employers who may end up short-staffed. As of today, FFCRA will be running out at the year’s end, so make sure you know all of the options. While most businesses will close for Christmas Day and New Year’s Day, and perhaps a few more days in between, some employers plan to expand their time-off policies this year due to the pandemic. Other employers are offering a range of new perks to keep employees connected and to recognize their contributions during this challenging time. Regardless, businesses should remain aware of evolving protective guidelines from the federal Occupational Safety and Health Administration (OSHA), along with state and local agencies that are meant to keep workers healthy and safe.

Lastly, today’s Dialed in with Delta was a wonderful success, with expert panelists who provided an abundance of helpful tips and guidance for remote employees. Topics discussed include: the ergonomic design of a home office, keeping employees healthy (both mentally & physically) and motivated, and protecting your data from internet hackers. Click here to view the recording.

Have a great weekend!