COVID Relief Bill Passed

Posted on Tuesday, December 22, 2020

Late Monday, December 21, 2020, Congress passed the COVID-Related Tax Relief Act of 2020 as part of the Consolidated Appropriations Act of 2021. The Acts provide over $900 Billion in relief to individual taxpayers and businesses. President Trump is expected to sign the bill into law this week. Among the provisions are these highlights:

A $600 stimulus check to most Americans, based on the same income limits as the one earlier this year.
These will be treated as additional payments based on 2019/2020 income.
First checks could come out the week of December 28.
Extended federal unemployment benefits of $300 per week for 11 weeks.
Includes gig workers
Regular unemployment benefits will be available for 50 weeks instead of typical 26.
COVID-related paid leave refundable tax credits were extended through March 31, 2020.
$280 billion in new PPP loans
Congress is making clear that expenses used to generate PPP loan forgiveness (for both 2020 loans and 2021 loans) are deductible.
Clarification that forgiven EIDL loans are not includable in income.
Recipients of earned income credits and child tax credits can qualify based on 2019 income if that is more favorable than 2020 income.
Multiple tax extenders, including allowing limited above-the-line charitable deductions for non-itemizers in 2021.
Starting in 2021, businesses will be able to deduct restaurant meals in an attempt to help restaurant owners recover.
Support for theater operators, airlines and some other small businesses.
Rental assistance and increased food stamp benefits.

Watch this space for more detail on these and other items. Please contact your DWD accountant if you have questions.

Contributed By: Mark Westerhausen, CPA | Director | DWD CPAs & Advisors

Posted in Tax And Accounting Topics For Business

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