My last article from April 14 provided a few perspectives and updated observations on how the March 27 CARES Act was unfolding. This article is, what I expect to be, the last in this series. I will return you to your regularly scheduled programming starting in May – one newsletter each month, rather than nine in two months. Whew! Hang in there, my friends!

Stay safe and take care,




Economic Impact Payments

What might have been a straightforward payment of $1,200/$2,400 to certain US households was anything but. Without upfront guidance from the IRS on how payments were being batched, many folks were left wondering where their payments were on the April 15 rollout date. Some still are; only about half of the total payments have been issued as of this writing. Bank websites were overwhelmed as millions of taxpayers continually checked their balances for these payments. The IRS website established to collect direct deposit information has been buggy, e.g., security questions don’t accounting for all situations. IRS says much of the issues have been corrected. As always, when in doubt, start with and navigate to your intended screen to avoid providing sensitive information to someone who is not the IRS.

Will there be more rounds of relief payments? There’s certainly been discussion, but nothing concrete has been announced as of this writing.

Reminder: These payments have been an advance on the amount that will be calculated on your 2020 tax return to be filed in 2021. If your 2020 tax return reports a higher impact payment than what you received, you will be entitled to the difference. If your 2020 tax return reports a lower impact payment than what you received, you will not have to repay the difference. In no scenario does the economic impact payment effect your tax liability or related balance due/overpayment.

Paycheck Protection Program (PPP)

You would have to be living under a rock to not have seen how this ultimately played out. In a nutshell, there was a lot of work and frustration and ultimately insufficient funding to small businesses relative to the intention of the underlying law. There’s been debate and hard feelings around who “should” have received the loans, big company loan refusals after public shaming, lenders accused of favoritism toward helping large clients obtain funding, etc. This tax practitioner’s view is that a system is designed to get the results it gets. The players involved were set up to fail based on the language of the law, and then they failed. Legislation meant to help small businesses needs to be written in a way that it actually does so. Effective legislation should not pit the Treasury against the SBA, banks against businesses, or businesses against each other. If Congress would like assistance in the future, I and many of my colleagues would be happy help.

The Interim Stimulus Plan, dubbed “CARES Act 3.5,” was passed, providing billions in further business loans, as well as healthcare funding. As part of this, a second round of PPP funding rolled out on April 27 to the tune of $300+ billion, with $60 billion reserved for “small banks” with assets under certain thresholds. Word on the street is that much of these new funds have already been earmarked by applications in place when the first round of funding was depleted. For interested businesses, however, it may make sense to pursue loan applications all the same, particularly if yet another round of funding is approved. The feedback I’m receiving from clients is that they are having better success with smaller banks and fintech options such as PayPal over larger banks.

For those who have received the loan there has been confusion around how related forgiveness will ultimately be calculated. This is important as the forgiveness component is what has made this loan  so attractive. Many businesses may have spent their PPP funds, but not necessarily in a way that results in full/meaningful forgiveness. If this is the case, the funding then remains a loan that some businesses may have difficulty repaying. Continue to keep an eye on the IRS/SBA’s continually updating guidance for more direction about forgiveness.

Reminder: other options for deferring or reducing payroll-related cash outflow remain available such as payroll tax payment deferrals and/or the Employee Retention Credit.

Georgia Unemployment

The Georgia Department of Labor was woefully unprepared to process this many unemployment applications at once, especially with the addition of self-employed individuals . From the Department’s website and Twitter feed, the DOL is trying as hard as it can to quickly and appropriately handle the deluge of claims and questions.

I have had one report that the Georgia DOL is asking self-employed individuals to send confidential information such as tax returns and bank statements for income verification via a DOL email address as opposed to a secure portal. Please be careful what you are providing to any government agency and how you are sending it. With so much data flying around right now, identity thieves are having a heyday. If you are a client and concerned about the documentation you’re providing and the method of doing so, please reach out to me.

A state’s ongoing ability to pay claims is also a concern. According to the Tax Foundation’s report from earlier this month, Georgia could, at that time, pay about 11 weeks’ worth of claims without exhausting its unemployment trust fund. This is a moving target, however, depending on new payments into the fund and claims made against it. As new claims increase, ability to pay could be an issue for Georgia and many other states.

Reminder: as of this writing, unemployment benefits remain taxable, so make sure you have federal and state income tax withholding on your benefits.

Roth Conversions

Tax rates are historically low and the market has had some down days in the past couple of months. I’ve had several clients ask if now is the right time to convert some or all of their IRA balances into Roth accounts.

Numerous factors play into this decision: your tax brackets now, your tax brackets in retirement (have fun guessing at that), how long until you will need to draw on retirement assets, your need for tax-free income in retirement, how paying the tax on the conversion will impact your current and future financial situation, the contents of your portfolio, and so on.

If you’re interested in pursuing a Roth conversion, the first thing to do is reach out to your financial advisor/planner. This is the person who will have the most insight into your current financial situation and long-term financial goals. Then, if a conversion makes sense, circle back to me, and we can discuss current tax implications.

Extended Tax Due Dates

Reminder: July 15th is the new due date for pretty much everything – nearly all 2019 income tax returns, as well as 1stand 2nd quarter 2020 estimated tax payments. Whatever type of income tax return you file, if the due date (including extension) falls between April 1 and July 15, the new deadline is very likely now July 15. Federalestimated tax payments otherwise due April 15 and June 15 are now both due July 15.

If you haven’t filed your 2019 tax return, I advise handling this as soon as possible. If you are my client and have all documents to me and any outstanding questions addressed by June 15th, I currently expect filing your tax returns by July 15th to be absolutely feasible.


  • Maybe NSA has crazy spyware, but many government agencies that impact our daily lives are still operating in the previous century in terms of technology and related processes. They don’t have the infrastructure in place that would have helped them better handle tasks such as funding business loans, issuing relief payments, and quickly providing expanded unemployment benefits.
  • Congress is confused about what a “small business” is.
  • Even when things are moving quickly, unanalyzed, spur-of-the-moment decisions are not the best move.