We understand employers and business owners are worried about how COVID-19, the novel coronavirus, will impact their business finances amidst shutdowns and uncertainty. The government is taking measures to support small businesses across the entire United States who are all experiencing a slowdown. Don’t panic, we are monitoring the federal, state, and local government financial resources to get you and your business through this with our financial guidance.
At 365BOOKSPRO, we continue to be available to provide financial guidance for employers. We do not anticipate any interruption to client services as our IT systems and operations have always been structured to operate remotely. Fortunately, our workforce has not contracted the virus. We continue to take preventive measures, such as disinfecting common areas, washing our hands, using hand sanitizer, etc. We have restricted travel and visitors to our office to follow the social distancing practices recommended by government officials.
We are ready to synthesize information from the many agencies implementing measures and serve as a guide to ensure your business will be best equipped to weather the pandemic. Below are some key things you should know and the actions you can take now:
1. IRS Federal Income Tax Payments are deferred until July 15, 2020.
Keep in mind that interest and penalties will accrue beginning July 16th. Affected Taxpayers subject to penalties or additions to tax despite the relief granted by this section may seek reasonable cause relief for a failure to pay tax or seek a waiver to a penalty for failure by an individual or certain trusts and estates to pay estimated income tax, as applicable. Similar relief with respect to estimated tax payments is not available for corporate taxpayers or tax-exempt organizations. More info.
With the IRS tax deadline extension, it is still important to be prepared. Here is a helpful list to help you stay organized if you’re considering obtaining a loan:
- File your 2019 Business Return on time.
- Prepare a Personal Financial Statement.
- Schedule of Liabilities listing all fixed debts.
- Year-end profit-and-loss statement and balance sheet for that tax year.
- Keep your financials up-to-date. A current year-to-date profit-and-loss statement.
- Monthly sales figures for increases in the amount of economic injury.
Businesses impacted by COVID-19 are eligible for up to $2 million in assistance. These loans can provide vital economic support to help overcome the temporary loss of revenue your business is experiencing. They may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. The interest rate is 3.75% for small businesses without credit available elsewhere; businesses with credit available elsewhere are not eligible. SBA offers loans with long-term repayments to keep payments affordable, up to a maximum of 30 years. Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay. You can prepare to apply by reviewing the “Three-Step Process” of SBA Disaster Loans to understand the application process. Disaster loan applicants can call the SBA Disaster Assistance Customer Service Center at 1-800-659-2955 or email firstname.lastname@example.org.
We can assist to streamline your application process with accurate supporting documents required to apply such as your finalized tax return, reconciled accounts, updated P&L, updated balance sheet, etc.
3. Ensure liquidity to weather the storm.
Businesses need to define liquidity scenarios tailored to their context. For critical variables that will impact revenue and cost, you can input numbers through analysis and expert involvement. You should review your financials in each scenario and identify triggers that might significantly impair your liquidity. For each trigger, identify moves to stabilize your business.
4. Communicate clearly with employees, customers, and stakeholders.
Let them know how you are responding as a business. Many people will trust their employers and local businesses over what they see on the internet. Your ability to help stop the spread will mean an increased trust in your business.
Again, keep in mind, things are fluid right now with aid and relief for small businesses coming. We’ll update you with more details as we discover them.
If you need assistance, schedule a meeting with us!