As the coronavirus (COVID-19) continues to affect local communities and global economies, you may have concerns about your financial well-being. Or you may be wondering about how recently passed legislation impacts you. We’re providing a high-level summary of some of the key provisions impacting individuals and recommend discussing your particular circumstances with us in more detail.
Relief available
There are several recently enacted tax changes and new or expanded benefits that might be helpful to you.
Income tax provisions:
- The IRS extended the April 15, 2020 federal income tax filing and payment deadline to July 15, 2020. However, we continue to work on filing returns as soon as possible.
- First quarter estimated tax payments usually due April 15, 2020 are now extended to July 15, 2020.
- Georgia has also extended the filing and payment deadlines to July 15, 2020.
Recovery rebates:
- Payments to individuals of $1,200 ($2,400 for joint filers) plus $500 for each qualifying child are expected to be delivered around mid-April.
- The recovery rebate begins to phase out for taxpayers with adjusted gross income (AGI) above $150,000 for joint filers, $112,500 for heads of households and $75,000 for other individuals. If you’d like to estimate the amount you’ll receive, download the AICPA’s CARES Act stimulus calculator in excel format cares-act-stimulus-calculator
- The payment is not taxable.
- More details on this payment are still forthcoming.
Retirement accounts:
- Through the end of the year, individuals who are under 59 ½ years old can take up to $100,000 in coronavirus-related distributions from retirement plans without the usual 10% penalty for early distributions. The distributions may be repaid within three years and any resulting income inclusion can be taken over three years.
- If you were over 70 ½ at Dec. 31, 2019 you won’t have to take required minimum distributions (RMD) in 2020. If your retirement assets have taken a hit, not having to take an RMD may allow those assets to recover some value before you liquidate them..
Other benefits:
- Other benefits are available including expanded unemployment, emergency paid sick and family leave benefits. (click on link for more info) https://www.dol.gov/agencies/whd/pandemic/ffcra-employee-paid-leave Unemployment benefits are extended to self-employed and part-time workers.
