To our Valued MHA Clients and Friends:
 
Happy Friday to all of you! We’ve made it to the last full week of March, and April is around the corner. Colorado folks had our first day of “Staying at Home” yesterday and it was a beautiful day. Today is a bit chilly but hopefully the weather will perk up tomorrow and bring a weekend filled with your favorite quiet moments and at least one smile on your face.
 
I have heard good reports from the Colorado unemployment system and it appears to be processing applications timely, now. First benefits should start arriving next week for those who were able to file last week. If a Colora dan has e xhausted their 26 weeks of unemployment benefits they will be eligible for another 13 weeks once the extension kicks in around mid-April, says the state Department of Labor. 
 
Also in today’s news, the House has passed the CARES Act and we expect the POTUS to sign it today. Analysts are working hard to make sure we all know what it means for each of us, especially as it pertains to the stimulus check. My understanding is that the US Treasury will use your most recent tax filing, either 2019 or 2018, to determine eligibility. No signup is necessary. If you have not filed a tax return for either year 2018 or 2019, and you are required to file a tax return, we recommend that you go ahead and file 2018 so that you could be considered eligible for the stimulus credit calculation. Call or email if you need any assistance with this process. The IRS has a website for additional information: https://www.irs.gov/coronavirus
 
The use of the term “Credit” is important in the understanding of this stimulus payment. This credit is really an advance on a refundable tax credit that is going to be offered on your 2020 tax return. This means that, if you do not get a check but you should have, it will be available when you file for 2020 next year.
 
if you have moved since your last tax return filing, and you do not have direct deposit information with the IRS, we recommend that you submit a Federal form 8822 Change of Address. This may not be processed before the stimulus checks are mailed but it is worth taking the time to ensure they have the right information for you.
 
We do have some additional clarification regarding the postponement of the April 15th deadline and other details of the People First Initiative. The IRS created a great Q&A Page which provides a wealth of information. It clarifies that the postponement applies to 1 st quarter estimates for 2020 which are now due July 15 th . The 2 nd quarter payment is still due June 15 th. HSA and IRA contribution dates are also postponed to July 15 th . Here is a link to the Q&A Page:
 
 
We’ve had a few questions about the Families First Coronavirus Response Act (FFCRA) this week. As far as we can tell, the payroll tax credit only applies to wages (hourly and salary) paid for people who are not allowed or able to work. If your employees are working then you do not qualify for the credit for those wages, even if you offer a bonus for workers who do not take sick leave. The D epartment of Labor is asking employers to post their company policy regarding this Act but email is fine for the notification. We’ve seen a few sample posters floating around the internet that can be used or modified for this purpose. Watch for scams as this is generally a way for people to try and convince you to buy a poster! The most recent version of this notice was issued on March 25, 2020. Check the Wage and Hour Division’s website for a sample poster:
https://www.dol.gov/sites/dolgov/files/WHD/posters/FFCRA_Poster_WH1422_Non-Federal.pdf or sign up for Key News Alerts to ensure that you remain current with all notice requirements:
 
Another question that has come up recently relates to tipped employees and unemployment claims. The key to tips is knowing if the employer has reported the tips when reporting wages. If the employer or employee has been tracking tips and paying taxes on them, you may be able to claim them as lost income when filing for unemployment.
 
Please continue to reach out with questions. I am happy to talk through some of the issues that we are facing as we move forward and through this crisis and your calls and emails are giving me good ideas for these update emails!
 
Take care and stay strong,
 
Kim Hitchcock, CPA
McNurlin, Hitchcock & Associates, P.C.