The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), signed into law on March 27, 2020, provides $349 Billion in SBA 7(a) forgivable loans to businesses and nonprofits with fewer than 500 employees [see endnote 1), including sole proprietors, the self-employed and independent contractors. Known as the Paycheck Protection Program (PPP), the maximum available loan amount is 2.5 times your average total monthly payroll costs, capped at $100,000 per employee on an annualized basis [see endnote 2]. The loan proceeds can be used for any authorized business purpose, but to the extent used to pay payroll costs, healthcare benefits, eligible rent or mortgage interest payments and utility costs over an eight (8) week period from the date the loan is made, the loan can be forgiven (the lender is paid by the SBA). There is no collateral and no personal guarantees required. There is no requirement regarding exhausting other available credit. The SBA pays the lender all loan origination fees and has waived many of its otherwise onerous requirements. To the extent any loan balance is not forgiven, the interest rate will be fixed at the time of the loan somewhere between 0.50% and 4.0% [see endnote 3], amortized over up to 10 years, payable over two (2) years, with all payments deferred for six (6) months. There is no prepayment penalty. The program is only available through June 30, 2020, but funds are limited, so don’t wait. For more detailed information, see below and PPP Information Sheet.
By Michael Mills and Elaine Yandrisevits
Taxing jurisdictions continue to assess how to respond to the COVID-19 pandemic, with state and local jurisdictions being challenged by budget limitations. In the forefront of most people’s minds is the tax deadline for personal income tax returns normally due on April 15th. The following is an updated overview of the tax payment and filing deadlines applicable to our region:
On March 27, 2020, President Trump signed into law the Coronavirus Aid, Relief, and Economic Security Act (referred to as the “CARES Act”). This sweeping legislation provides economic relief for small businesses and taxpayers who are impacted by the Coronavirus pandemic. Nonprofit charitable organizations and their employees share in some of these benefits.
In response to the ongoing COVID-19 crisis, Governor Wolf approved a temporary suspension of the physical presence of notaries for certain real estate transactions on March 25, 2020. The existing law, codified at 57 Pa. C.S. § 306, requires a notary to be physically present when witnessing the executing of documents.
As most of you know, last night the U.S. Senate passed the “Coronavirus Aid, Relief and Economic Security Act”, being referred to as the CARES Act, which is now being sent to the House of Representatives for a final vote. It is expected that the House will pass the measure without further changes, and that it will be signed into law by the President. More details will be provided as we move along, but broadly speaking the CARES Act provides the following benefits and stimulus to U.S. small businesses and individuals:
With individuals residing in Allegheny County, Bucks County, Chester County, Delaware County, Monroe County, Montgomery County, and Philadelphia County ordered to stay at home with only certain limited exceptions, and non-life sustaining businesses ordered to close, business owners struggle with what to do next. The full text of the Governor’s order and other related information can be found here. While there are many unanswered questions and additional guidance is continually being issued, business owners do have resources available to them.
In the course of the past few days, we have all been presented with unforeseen challenges as a result of the COVID-19 virus. If you currently have a custody order in place or are going through a custody battle, you might be experiencing parenting issues stemming from the coronavirus outbreak, the recent school closures and work from home mandates.
Business interruption insurance covers a business’ losses resulting from a direct physical loss or damage to property. Accordingly, coverage under such a policy generally will not trigger unless there is a direct physical loss to the business’s property. In some circumstances, loss of income due to a disaster-related closing of a business’ physical location is covered.
On Friday, March 20, 2020, Treasury Secretary Mnuchin stated, via Twitter, that the federal government is “moving Tax Day from April 15 to July 15,” and that “all taxpayers and businesses will have this additional time to file and make payments without interest or penalties.” Though the U.S. Treasury and Internal Revenue Service have not yet issued any official written pronouncements, Secretary Mnuchin indicated that he was tweeting at the direction of President Trump.
As the coronavirus pandemic extends its grip across the Commonwealth of Pennsylvania, its effects are felt throughout the practice of law. The very nature of litigation, the need for witness testimony, advocacy and argument before a tribunal, judge or jury necessarily implicates close personal contact. While measures to preserve the status quo are certainly necessary, the impact on pending litigation as well as potential new litigation, is developing.