Note: This guidance was sent as a client alert on April 23, 2020 and the information is current as of that date.
Economic Impact Payments
The IRS continues to experience issues with the economic impact payments and the portal (https://www.irs.gov/coronavirus/economic-impact-payments) setup for taxpayers to provide updated direct deposit information. IRS and Treasury officials acknowledged they are aware of numerous issues and are working to fix them. Many taxpayers that are eligible for economic impact payments are receiving “payment status not available” when they enter information into the IRS portal. The IRS is aware of the issue and is working to correct it. Since their offices and telephone support are closed, the only solution they have offered is to check the portal daily for updates. They are adding information to the portal on a regular basis to allow more taxpayers to use it. If you expect to receive a stimulus payment, and have not already, verifying and updating this information is important to ensure prompt receipt of funds.
Paycheck Protection Program (PPP) Loan Updates
The senate passed a bill with additional funding for this program on Tuesday and the House is expected to pass the bill today. The SBA is expected to reopen the application process as soon as tomorrow morning. Congress has allocated $310B additional funds to restore the program, with $60B directly allocated to smaller lenders and community banks. Many applications were not funded in the first round and banks have retained those applications and will submit them for the newly authorized funds. Most banks have established “stages” for their application process. We are advising that if you are at the final stage where you only need SBA approval, you should stay with your current bank. However, if you loan has only been submitted and the bank review has not been completed, it may be advantageous to explore other alternatives to obtain funding if possible. The funding is expected to be exhausted quickly due to the volume of applications already in process. Treasury Secretary Mnuchin has indicated previously that more funding would be allocated if need exceeds the current congressional allocation, but there are no guarantees beyond the current allocation.
Economic Injury Disaster Loan (EIDL) Updates
An additional $60B of funding for this program is also scheduled for approval today. The SBA is expected to reopen the application process as soon as tomorrow morning. Applications that were already submitted will continue to be processed on a first come, first serve basis.
If you have applied for and received funds from the PPP or EIDL programs, please let us know which program and which bank provided the funding.
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