The IRS is extending the federal income tax filing deadline from April 15^th to July 15^th as part of a growing effort to stem the financial pain from the coronavirus pandemic, Treasury Secretary Steven Mnuchin announced this morning.

This move gives you three additional months to file your income tax returns for the 2019 tax year, without incurring interest or penalties.

Per Mnuchin, “all taxpayers and businesses will have this additional time to file and make payments without interest or penalties,”.

Mnuchin urged taxpayers who might receive refunds this season “to file now to get your money.”

Some individual states already have extended their own tax filing deadlines to various dates to give people relief. The IRS will be increasing pressure on states to align their deadlines with the new one for federal income tax returns.

Here is a helpful link here that lets you know each states tax filing requirement.

New York Gov. Andrew Cuomo, asked at a press conference if state residents should pay their state income taxes by the New York deadline of April 15, said the new federal guideline should be followed.

It is not yet clear if the deadline extension also will include the deadline for funding Individual Retirement Accounts for the 2019 tax year.

We remain committed to providing you with the most up-to-date information as we know it.  As always, we are in this together with you.

Stay healthy,

WZ Partners

March 20, 2020

Dear WZ Client,

As we press through these trying times, we are working hard to uncover all the available options to help you and your business. A potential option is the SBA Express Loan Program.

In order to qualify, a business must meet the eligibility requirements determined by the SBA under the SBA 7(a) program, which are:

• You must be registered as a for-profit business
• As the business owner you can’t be on parole
• Your business must have fewer than 500 employees and less than $7.5 million revenue on average each year for the past three years
• Your net income must be under $5 million (after taxes and not counting carry-over losses), and your tangible net worth must be less than $15 million
• You must show you’re investing your own time and money into the business, having “invested equity”
• Your business must be physically based in the United States
• Your business must not be speculative, illegal, or non-profit
• You’ll need to show you tried and failed to get funds from other financial lenders
• You’ll need to prove you have a sound business purpose
• You’ll need to prove you are not delinquent on any existing debts to the U.S. government

The key terms for the SBA Express Loan include:

• Max loan amount: $350,000
• Maturity: 5-10 years (7 max for a line of credit), or up to 25 years for real estate
• Application turnaround time: Within 36 hours
• Fund Dispersal time: 45-90 days after approval

We highly encourage all eligible businesses negatively impacted by COVID-19 to click on the link here for further information on how to apply for the SBA Express Loan Program.

The WZ team remain committed to keeping you “in the know” and support you, your family and your business in every way that we can.

Stay healthy,

WZ Partners

March 19, 2020

March 19,2020

Dear WZ Client:

The IRS Chief Counsel Office issued Notice 2020-17 on March 18 titled ‘Relief for Taxpayers Affected by Ongoing Coronavirus Disease 2019 Pandemic’. This update provides details about the deferral of federal income tax payments.

All taxpayers are technically considered to have been impacted by the COVID-19 pandemic and defined as Affected Taxpayers are now eligible to defer federal income tax payments that are normally due on April 15, 2020. The modified due date is now July 15, 2020. Taxpayers now have until then to pay before penalties and interest start accruing. The deferral relates to income tax due up to the “Applicable Postponed Payment Amount” (APPA), defined as:

• $10 million for each consolidated group of C corporations or for each corporation which does not join in filing a consolidated return; and
• $1 million for other taxpayers. The Notice confirms that this latter amount applies to individuals irrespective of filing status – meaning that a single person filing a federal income tax return has the same $1 million Applicable Postponed Payment Amount as a married couple filing a joint return. This rule effectively creates a cash flow marriage penalty on joint filers.

The Notice also goes on to explain that any tax due in excess of the APPA is subject to penalties and interest if not paid by the original April 15 due date.

• If a single individual filer owes $2 million for 2019 federal income tax purposes, including self-employment tax, the payment of the first $1 million can be deferred until July 15, 2020.
• However, the additional $1 million would be subject to penalties and interest if it is not paid by April 15.
  • In this theoretical situation, the taxpayer could request an abatement of penalties by the IRS on the additional $1 million due to “reasonable cause”. There is no way to know whether the IRS will grant or not grant the abatement. Regardless of this, the interest would generally not be abated.

The IRS also clarified that estimated tax payments due on April 15 are also covered under this deferred payment rule.

• However, this proposes that the second estimated tax payment normally due on June 15 is not covered unless new information comes to light.
• The Notice notes that an individual and certain trusts/estates can seek a penalty waiver for underestimation of tax from the Commissioner, because of casualty, disaster, or “other unusual circumstances”, where the imposition of the penalty would be against equity and good conscience.
  • The right to request a penalty waiver for underestimation of tax does not apply to corporations.

The right to defer payment of tax applies only to income taxes relating to the 2019 tax return. It does not apply to other taxes such as payroll tax, gift tax, or excise tax.

The Notice also makes it clear that the deferred payment rule does not extend the filing deadlines of the income tax return. Impacted taxpayers can request extensions of time to file under the normal regime.

At this point there are still many unknowns as this is a very fluid situation. We are monitoring it closely and will keep you updated as the information changes.

If you have any questions or concerns please do not hesitate to reach out as we are ready to answer any of your questions.

Stay healthy and be well,

WZ Partners

March 18, 2020

Dear Valued Client,

If you are seeing a reduction in your business revenue because of the COVID-19, there are 2 different programs that a business can qualify under the SBA’s Economic Injury Disaster Loan Program.
1- NYC Employee Retention Grant Program
The City is offering small businesses with fewer than 5 employees a grant to cover 40% of payroll costs for two months to help retain employees.
In order to qualify under the NYC Employee Retention Grant Program, the business must meet the following additional requirements:

 Be located within the five boroughs of New York City
 Demonstrate that the COVID-19 outbreak caused at least a 25% decrease in revenue
 Employ 1-4 employees in total across all locations
 Have been in operation for at least 6 months
 Have no outstanding tax liens or legal judgements
2- NYC Small Business Continuity Fund
Businesses in NYC with 99 employees or fewer are eligible for zero interest loans up to $75k to mitigate losses.
In order to qualify under the NYC Small Business Continuity Fund the business must also meet the following additional requirements:
 Be located within the five boroughs of New York City
 Demonstrate that the COVID-19 outbreak caused at least a 25% decrease in revenue
 Demonstrate ability to repay the loan
 Have no outstanding tax liens or legal judgements
As part of the applications, you will be required to demonstrate a revenue decrease by providing documentation such as: point-of-sales reports, bank statements, quarterly sales tax filings, 2019 tax returns, or CPA-certified profit & loss statements. If you qualify under either of the two programs, we highly encourage that you submit an online application using this link

Official press release link HERE

More information about the programs on the NYC official website HERE

As always, the Partners and WZ team remain committed to helping you, your families and your business through these unknown and stressful times.