What is the CARES Act? Small Business Owners Guide to CARES Act

Employee health coverage is a significant part of many companies’ benefits packages. However, the administrative responsibilities that accompany offering health insurance can be complex. For all product updates, you can check out our Firm of the future page.

Based on a recent Thomson Reuters survey, a new compliance alert is issued every seven minutes around the world. Frequent changes in compliance laws mean there is little to no data that can be used to “learn” these changes ahead of time. While you work on your QuickBooks paycheck protection program application, here are some additional small business resources to help get you through COVID-19. It’s important to note that you can only spend 25% of the money you receive on non-payroll expenses such as rent and utilities if you want your loan to be forgiven. With funds for the QuickBooks paycheck protection program drying up fast, here’s what you can do to prepare for the next round of QuickBooks Capital loans.

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• QuickBooks Capital can assist applicants in determining eligibility and automating much of the application process.
• I named this account “Non-Taxable income ” it is currently “unassigned ” in tax-line mapping.
• If no tuition plan is in place, they would have to set one up first.
• While you can continue to use the funds after this period, you won’t be able to claim loan forgiveness on these expenses.

The payroll item contains an item for anything affecting the amount of a paycheck such as wages, expense reimbursement, taxes, benefit withholding amounts, etc, as well as any company expense related to payroll. This deferral applies to the 6.2% Social Security (old age, survivors, and disability insurance tax) portion of the employer’s obligation. Self-employed people are allowed to defer 50% of their Self-Employment Contributions Act (SECA) tax payment, including any related estimated tax liability. The deferral does not apply to the employee’s portion of the Social Security tax or the 1.45% Medicare tax.

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As the #1 QuickBooks CRM in the Intuit app store, we’ll be following the QuickBooks paycheck protection program closely and will continue to update this post as new details become available. There may be other issues in your tax return that would cause the forms to be out of balance. I tried telling it not to quickbooks payroll cares act import that account but further into the return the balance sheet is out of balance by the amount of that account. You can generate reports such as payroll summary reports, tax liability reports, or detailed wage reports to review COVID-related pay types and ensure compliance with tax filings.

E. If the bank forgives the loan, or a portion of the loan, prepare a general journal entry.

Simple explanations—for example, why the filer does or doesn’t qualify for the Earned Income Tax Credit (EITC)—boost customer confidence in their experience. QuickBooks Payroll automatically notifies small business owners when they’ve made errors in overtime calculations, more than doubling the compliance rate among our customers—and helping them avoid possible $10,000 fines. To qualify for loan forgiveness, you’ll have to spend the funds you get through the QuickBooks paycheck protection program within 8 weeks of receiving them.

And the S-corp must file the proper W-2 and W-3 and form 941 or 944 plus the corresponding state forms for your state. Learn how Method CRM helps businesses impacted by COVID-19 work from home with ease. See articles customized for your product and join our large community of QuickBooks users. ESD will process all WA Cares Fund exemption applications sent in by June 1, 2023, before premiums take effect in July.

• With more than a decade of work in Knowledge Engineering, we’ve made tremendous strides in enabling simpler, more personalized experiences for customers with the precision they need for critical financial applications.
• Borrowers can use loans to pay fixed debts, cover payroll costs, and pay other bills they cannot otherwise pay due to the economic impact of the coronavirus.
• In the years to come, we’ll continue to harness the full potential of AI to speed innovation.
• Embedded within TurboTax, the platform correlates its understanding of 80,000 complex, frequently changing rules with each individual’s unique situation to find possible errors and omissions.
• During the whirlwind that COVID-19 has been, many of us have heard about the paycheck protection program but may not fully understand it.

If you were filing a tax return for an S Corp. on form 1120, the educational assistance would go in the same place that routine employer provided educational assistance would go. But since it has been an allowable employee benefit for many years, I assume there is some standard place to enter it. Under the paycheck protection program, certain expenses will allow your loan to be forgiven and converted into a grant. To make the most of the QuickBooks paycheck protection program, you’ll want to create a business plan that ensures as much as your loan is forgiven as possible. This is why companies like Intuit QuickBooks have stepped up to reduce the time it takes for small businesses to receive funds from the paycheck protection program.

Key Tax Fact Sheet

It would be nice to have everything accurate before sending to my CPA. You already play a key role in advising your clients on their taxes, so spend the extra time to advise on how to keep track of their PPP loans. Spending time on the front end by setting up the recordkeeping and processes will save a lot of time in the long term. This content is for the first stimulus relief package, The Coronavirus Aid, Relief and Economic Security Act (CARES Act), which was signed into law in March 2020. For information on the second stimulus relief package, the Coronavirus Response and Relief Supplemental Appropriations Act of 2021, please visit the second post here. A small business owner in dire straits from the COVID-19 crisis needs financial relief—urgently.

PPP Flexibility Act: Legislative update to the Paycheck Protection Program

The Loan Forgiveness Covered Period of any borrower will end no later than Dec. 31, 2020. Borrowers can apply for loan forgiveness with their lender, and the lender is responsible for determining eligibility. Certain borrowers are also eligible to use a simplified EZ Loan Forgiveness Application when filing for forgiveness.

Taking the business profits as dividend or capital gains income without paying employment taxes is the number 1 adverse audit finding for small businesses. QuickBooks was named as a direct lender by the SBA, giving them the power to accept, approve, and fund paycheck protection program applicants. The challenge, however, is the time it takes for small businesses to receive these government-backed loans through banks and the Small Business Administration (SBA). A result of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, the paycheck protection program’s goal is to help small businesses pay and retain their staff during COVID-19.

About Intuit

QuickBooks will continue to expand the ability to apply to other customers as well in the coming days. Borrowers can apply for approximately 2.5 times their average qualified monthly payroll expenses, up to $10 million and subject to certain restrictions. The application period began on April 3, 2020, and runs through the earlier of June 1, 2020, or when all the funds have been committed. Knowledge engineering continues to help us solve new problems for small businesses and consumers. We brought Intuit Aid Assist online in just 21 days from idea to launch—an incredibly fast response to an urgent need. The Knowledge Engineering platform gave us a critical running start in this effort, making it possible to offer millions of people the help they need at a difficult time.

Contact us for help to exempt your employees from WA Cares coverage. Effective July 1, 2023, you’re required to start collecting employee premiums. The Long-Term Services and Supports Trust Program helps provide long-term care insurance to Washington employees.

By offering 8 weeks of funding to small businesses through loans or grants, the paycheck protection program aims to keep people employed and small businesses afloat during this time. Employers can also get credit for any health insurance premiums they pay for impacted employees while they are on leave. Business owners can also apply for an EIDL emergency advance of up to $10,000. These funds will be made available within days of application and will not need to be repaid, even if the business’ application for an EIDL loan is denied.