As most of you know, my son, Chris, is a CPA, and is the president of a small (35 member) accounting firm in Colorado Spring. I just got off the phone with him about the new bailout. He has spent the last two days reading everything he could about this bill, and how it impacts small businesses and self employed people like us. Here is what he was able to find out.
First of all, most of what we pay every year in taxes is not income tax, but social security, or self employment tax. So the actual impact on our social security tax is not going to be very much. We still have to pay that. But here is how this bill will help us.
For self employed tuners there are two benefits.First, our 2019 taxes are not due until July 15, instead of April 15.
Second our estimated taxes that we have to pay will be put on hold for at least one quarter, if not the entire year. In an sense we're getting "reimbursed" for our estimated taxes by not having to pay them until later. Because most of us will have less income this year, our tax bill will be less than last year, and that is the "benefit" we will get. We won't get an actual check, but we won't have to pay as much upfront. (This does not have anything to do with the "hand out" from the government that we should all get, no matter what.)
For those of you who have employees, and have had to lay them off, you can get money from the government to hire them back. There is a process and paper work that needs to be filled out, but the way Chris put it, it's better to give employers money to hire their workers back, than to give those workers unemployment checks. That is how the Federal government is helping small businesses.
Anyway, hope this helps. As always, please consult with your own accountant to get the latest details.
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Willem "Wim" Blees, RPT
Mililani, HI 96789
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Original Message:
Sent: 03-26-2020 19:04
From: Karl Roeder
Subject: Unemployment insurance eligibility
My reading of the $2 trillion stimulus package is that self employed people (most of us) are going to be newly eligible for unemployment insurance. I am hoping that the Home Office and our members who are good at accounting matters (I'm looking at you Mr. Barnes) will give the rest of us some guidance on how to proceed. Anyone out there have an informed opinion?
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Karl Roeder
Pompano Beach FL
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