March 23 Update

March 23, 2020

Much has happened in the last several days, specifically regarding tax deadlines, employer-mandated benefits and available tax credits. As always, we will do our best to keep you informed as things change. Here’s the latest:

For Individual Taxpayers:

  1. Federal Filing and payment deadline moved to July 15, 2020
  • Tax return due date now 7/15/20, no extension required
  • 2019 Balance due 7/15/20 with no penalties or interest accrues during deferral period
  • First Quarter 2020 estimate due 7/15/20 (instead of 4/15/20)
  • Second Quarter 2020 not yet addressed, currently still due 6/15/20
  • 2019 IRA and ROTH IRA contributions, 2019 529 contributions & 2019 HSA contributions now due by 7/15/20
  1. South Carolina filing and payment deadlines moved to July 15, 2020
  • Tax return due date now 7/15/20, no extension required
  • 2019 Balance due 7/15/20 with no penalties or interest accrues during deferral period
  • First Quarter 2020 estimate due 7/15/20 (instead of 4/15/20)
  • Second Quarter 2020 not yet addressed, currently still due 6/15/20
  1. Other States
  • Each state is determining their own COVID-19 relief provisions.  Some are following the federal and some are setting different due dates, waiving penalties, or doing some combination of both.

For Employers:

  1. Employee Pay (for employers with less than 500 employees)
  • Are required to continue to pay employees that are unable to work due to COVID-19 illness for up to 10 days.  Pay is 100% of normal daily pay up to $511 per day.
  • Are required to pay certain employees that cannot work due to school closures a percentage of their normal pay for up to 12 weeks.  Pay is 2/3 of normal daily pay up to $200 per day.
  • These rules supersede any sick leave policy the employer currently has in place.
  • Will be eligible for tax credits. The tax credit amount relates to the pay amounts above and will be a payroll tax credit. 
  1. SC Tax Relief
  • SC has suspended any tax return and payment due between April 1 and June 1, 2020.  This includes:
  • SC withholding taxes
  • SC sales and use taxes
  • SC accommodation taxes
  • SC income taxes and estimated payments
  1. Company Loans
  • The company may be eligible for SBA disaster assistance loans to funding working capital.  These loans are a fixed interest rate (currently 3.75%), with flexible deferral and repayment options.  More information can be found here:  https://www.sba.gov/page/coronavirus-covid-19
  1. Employers that lay-off workers
  • SC employers that have laid-off employees temporarily due to COVID-19 can assist their workforce by applying for unemployment benefits on their behalf. Your future experience rating will not be negatively impacted due to COVID-19 lay-offs. Unemployment benefits will be extended to your employees for up to six weeks.
  • We strongly suggest consulting with your employment and HR attorneys regarding your requirements and options.

For Self-employed individuals:

  • Refundable tax credits on their 2020 income tax return. No guidance is currently available and more details to be released later.

For Employees:

If you have been laid off or your work hours have been diminished due to the COVID-19 outbreak, you may be eligible for unemployment benefits: https://dew.sc.gov/docs/default-source/default-document-library/coronavirus-and-unemployement-benefits.pdf?sfvrsn=43a3bfd8_0

As always, contact your L+B+H team with any questions or issues you may have.